APARTMENTSABROAD.COM managing director Ian Thirlwall has
called for independent regulation to force agents to disclose
companies’ bonding details to holidaymakers.
The plea follows the failure of Travelscene, including unbonded
Citybedz.com, which left many agents out of pocket.
Thirlwall said the Government should introduce new enforcement
regulation, ensuring consumers are better protected from such
failures.
“There should be some form of consumer protection, not
necessarily with ABTA because that won’t cover direct
bookings,” he said. “There need to be financial safeguards even if
it means companies get their own bonds from a bank.”
Thirlwall said retailers must read the small print in
operators’ terms and conditions.
“If agents are selling these products, it is incumbent on them
to be transparent with the client. Every customer should be made
aware of the contract before they enter into it. When it’s a
booking agent, their contract is with the hotel.”
He said there was widespread trade confusion about the
difference between accommodation-only players acting as principals
and booking agents.
Principals – such as apartmentsabroad.com, which recently
rebranded from its previous name Apartments Abroad – contract
accommodation and flights, take out full tour operator liability
insurance and pay VAT under the tour operators’ margin
scheme. They take responsibility under English law if something
goes wrong.
Meanwhile, booking agents such as Citybedz act on behalf of the
hotel. Holidaymakers have a contract with the hotel direct and any
complaints are taken up with the hotelier and action pursued under
the law of that country.
Thirlwall said booking agents had a price advantage because they
were not shelling out for costs such as insurance, health and
safety checks, and customer service.
Consortia are already trying to clear up confusion among their
members. Worldchoice has announced it will write to all non-bonded
suppliers to clarify what financial protection they offer.
Chairman Colin Heal said: “Some non-bonded companies have
insurance bonds and, in light of the Travelscene situation, we need
to clarify this. It is up to individual members whether they book
them.”
The Federation of Tour Operators was due to hold a meeting on
finding a solution to the bond chaos as Travel Weekly went to
press.