The Civil Aviation Authority will treat the sale of two or more holiday items as a package that requires ATOL cover following the Government guidance issued to the trade last week.
The CAA dismissed concern that the guidance – issued last week by the Department for Business, Enterprise and Regulatory Reform – leaves an area of uncertainty, claiming agents will find it hard to sell anything outside the ATOL system.
CAA consumer protection group deputy director David Moesli said: “Agents who are dynamically packaging will be covered by this guidance.
“Where people buy two or more components of what looks like a package we will treat it as a package unless a company can prove it is not. This will make it difficult not to sell a package.”
The guidance, based on a 2006 Court of Appeal judgment, explains how businesses – and lawyers – should judge whether a holiday sale requires a tour organiser’s licence or an ATOL licence.
It makes clear that an ATOL is required for dynamic packages that include flights. But Federation of Tour Operators director-general Andy Cooper has suggested a grey area remains as the guidance states: “The sale of more than one travel service sequentially, for a single payment, need not, in principle, be a package.”
The CAA argued no one in the trade sells in this way – completing a booking without taking a payment and then making another transaction with the same customer.
Moesli said: “The vast amount of cases where a flight and accommodation are sold together will involve a package, and that is what we are going to consider.”
Director Richard Jackson said: “We strongly support this guidance. It does a good job of explaining the law.”
The CAA will study agents’ and online retailers’ businesses in light of the guidance, which explains the factors, such as e_SDHpadvertising that will make clear what customers are buying.
“Agents have to consider that to avoid selling a package will require explaining quite a lot [to customers],” said Moesli. “That is not a road agents typically use.”
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