ABTA has refused to reduce bonding for agents after a spate of independent agent collapses which have seen claims hit £3m.
Retailers, led by ARTAC Worldchoice, have been pushing for an increase in their credit turnover exemption for months, which would lead to them paying a reduced bond. They argue they are already covered under their own system.
But ABTA’s Travel Agents’ Council ruled it could not risk changes to the arrangements with so many independent retailers going bust. It will be reviewed again at the end of the year.
The decision came as another independent agent, Ross-on-Wye-based Ross Travel Agency, ceased trading.
ABTA chief executive Ian Reynolds said: “The 18 failures in 1999 are a sharp increase on this time last year when we had only three.
“TAC did not feel now was the appropriate time to increase the exemption, but made a commitment to look at the issue again at the end of the year.”
ARTAC said it would reserve judgement until then. But commercial director Julian Foster warned: “If ABTA arrives at the same conclusion then we will view it with the gravest concern.”
Reynolds said the £3m claims relate largely to Teletext specialist Florin Travel, which ceased trading in August. He added that he expected the amount to fall.
Meanwhile, the collapse of Florin has sparked a review of ABTA’s Travel Agents’ Bond Replacement Scheme, which the agency joined earlier this year. Reynolds said Florin’s accounts were given the all clear by ABTA when it joined the scheme.
“It is a cause for concern. We will be looking at the situation,” he added.
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