About 600 ATOL holders will have to continue to bond after the new financial protection changes come in, according to former ABTA head of legal services Alan Bowen.
The new requirements come into effect on April 1.
Speaking at a seminar on ATOL changes last week, Bowen said the Civil Aviation Authority could demand bonds from any company which “causes concern”, rather than just allowing them to be part of the £1 ATOL Protection Contribution.
Speaking to operators and agents to give them a summary of the requirements, he also told delegates that new ATOL holders, those with new businesses and small business ATOL holders of less than four years will have to continue to bond.
Bowen, now a consultant for chartered accountant Mac-Intyre Hudson, said: “I have been told that there are lots of bond obligors coming out – so if you need one then there will be more competition and less choice out there. Some large companies are having to pay bonds as well.”
Bowen also warned that as part of the standards that need to be met for the new £1 consumer protection charge, ATOL holders should look closely at the agencies they work with to make sure they are complying with the terms.
For example, the ATOL holder must take “reasonable steps” to ensure that the agent is issuing an ATOL receipt at the time the booking is made.
Bowen warned: “You really need to think who is acting as your agent.”
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