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28 Nov 2018

BY Rob Gill

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TRFBLI

Agents set to recoup Monarch commission

Agents have paid about £6 million in “pipeline” money for Monarch bookings to administrators since the airline and tour operator collapsed, but they are set to get their commission back, TTG has learned.

Monarch flies into the distance
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“Once we have finalised accounting for the recoveries to date, we will pay the recoveries secured for the benefit of the Atol scheme to the CAA.”

The company went out of business on October 2, 2017, with estimated debts of £756.6 million, leaving 110,000 passengers stranded abroad.


Administrators from KPMG, working with the CAA, have been pursuing agents for money from bookings made through Monarch Holidays and Somewhere2stay before the failure.


In their latest update to Monarch creditors, administrators confirmed agents would be repaid the commission they earned from these bookings, but did not give further details about when this would happen.


KPMG said around two-thirds of the money recovered from agents (£4 million) would go to the CAA, as the bookings were covered by the Atol scheme. The other £2 million would be available for creditors of Monarch Holidays and Somewhere2stay.


The CAA has been collecting payments from agents since March, when it took over the task from Monarch’s finance division, which is being closed down.


“Some of these recoveries will include travel agents’ commissions and VAT that will have to be repaid to the travel agents,” said KPMG.


“Once we have finalised accounting for the recoveries to date, we will pay the recoveries secured for the benefit of the Atol scheme to the CAA.”


KPMG also revealed it had completed the sale of the lease on Monarch’s former headquarters for £4.3 million and confirmed the return of aircraft to their leasing companies had been “fully completed”. Most of the money raised through the administration has been paid to secured creditors, including £60 million to Monarch’s offshore “controlling party”, Petrol Jersey Limited.


KPMG said it was planning to pay £2.7 million to preferential creditors – mostly former Monarch employees owed holiday pay – by December 31.
More than 500 mainly trade creditors with debts of £335.6 million will not receive any money.

 

  • The government’s Airline Insolvency Review, which is now “likely” to be published in “early 2019”, looks at whether to change UK administration rules to ensure airlines can “wind down in an orderly fashion”.
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