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Travel industry news

17 Apr 2019

BY Jennifer Morris

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Regulator calls for 'clearer T&Cs' from travel companies

The Competition and Markets Authority (CMA) has launched a new campaign urging travel businesses to “improve the clarity of their terms and conditions”.

CMA Check In On Your Terms
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The campaign also encourages businesses to be "upfront and clear with customers about charges and fees"

Titled ‘Small Print, Big Difference’, the campaign is being run in partnership with associations including Abta, UKHospitality and Aito.

 

It is calling on holiday and travel businesses to make sure they are using “fair” terms and conditions in their customer contracts.

 

The CMA’s campaign also encourages businesses to be "upfront and clear with their customers about charges and fees", especially in the event of a customer cancellation.

 

Under consumer law, businesses may be entitled to ask customers to pay a cancellation fee to cover their losses, but the amount they keep must be in proportion to what they are losing, the CMA stated.

 

“Cancellation terms that don’t follow this approach are likely to be unfair and businesses can’t rely on them to resolve claims or disputes with customers.”

 

A national survey of 2,000 people by Ipsos Mori, released by the CMA today (17 April), demonstrated what members of the public feel should happen if they have to cancel a trip.

  • 89% felt they should get all, or most, of their money back if they cancel and the business re-sells their booking.
  • 85% felt that it’s unfair if they have to pay part of the cost of a booking when they cancel.
  • 66% felt that travel and holiday businesses do not always make it as easy to cancel a booking as they should.
  • Of those with experience of cancelling a booking, one in five felt that they had been treated unfairly.

The CMA said a term could be legally unfair if it gives the business an unfair advantage.

 

Examples of unfair terms can include those which allow a business to take a large, upfront deposit and refuse to refund any of the customer’s money if they cancel, regardless of the amount the business is losing or the reason for the customer cancelling.

 

Another example is when a business insists on a large cancellation fee that bears no relation to the actual losses it experiences from the cancellation, the CMA added.

 

Mark Tanzer, chief executive of Abta, said: "Abta has discussed its model terms and conditions with the CMA, and along with the Abta Code of Conduct, I am confident they provide our members with a strong framework to ensure they are compliant with the regulations and are fair for customers.”

 

Derek Moore, chairman of Aito, added: “With the myriad of travel organisers, many from outside the UK and EU, targeting UK consumers, understandable and transparent conditions have never been more important.”

 

A new campaign site contains advice and information for businesses on unfair contract terms law and what they can look for when reviewing their terms and conditions.

 

In addition, the CMA has produced detailed guidance to help businesses and their legal teams understand how to apply the law.

 

What’s your view? Email feedback@ttgmedia.com and let us know your thoughts or leave a comment below.

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