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Package travel 'not under investigation' by the CMA
Package travel is not being investigated as part of a Competition and Markets Authority (CMA) probe into consumer complaints about refunds, according to a senior Abta director.
The CMA said on Thursday (30 April) it had instructed its Covid-19 Taskforce to look into "increasing numbers of complaints in relation to cancellations and refunds", including “holiday accommodation” during the pandemic.
But John de Vial, Abta’s director of financial protection and financial services, said package travel was not included in this new CMA investigation.
“With the CMA inquiry, it’s interesting what they have identified and are investigating – weddings, events, concerts, theatre and accommodation websites,” said De Vial during the Elman Wall Covid-19 online webinar.
“It’s in these areas where traders are denying the right to a refund because of the virus – they are saying there’s no refund due at all.
“They are not investigating the package sector at all, and that’s been confirmed to both us and the CAA.
“They can see that there are difficulties and delays with refunds to consumers. But we as regulators and quasi-regulators have said that the right of refund must be protected.
“Insolvency protection is also there, so customers will still get their money back. They are not going to include package travel in the investigation.”
Travel industry lawyer Joanna Kolatsis, director at Themis Advisory, said the CMA “would come down pretty hard” on companies charging high cancellation or administration fees.
“If you’re not telling consumers proactively what their rights are, you’re going to have problems,” she warned during the seminar.
Kolatsis said there had to be a “degree of reasonableness” within refund policies and added that “12 months is not reasonable”.
“For consumers choosing these refunds, tell them how long it’s going to take to process that refund – whether it’s six weeks or three months – but you cannot say it’s going to take a year,” advised Kolatsis.
Abta is continuing to press its case with the UK government for a “temporary” amendment to the Package Travel Regulations as many travel companies struggle to make refunds to customers within the statutory 14-day period.
“It’s a pretty frustrating process that’s been going on since the beginning of the crisis,” admitted de Vial. “We still don’t know what the government is going to do on that.”
Abta’s chief executive Mark Tanzer was due to hold a ministerial meeting with the Department for Business, Energy and Industrial Strategy (Beis) on Friday (1 May) to discuss the issue.
Rob Gill
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