HAPAG Lloyd has abandoned plans to expand into the UKmarket and is preparing to shut down its operations here at the end of the month.
The German business travel agency made the decision after it failed to persuade ABTA to review its ruling which required Hapag Lloyd to pay thousands of pounds a year in membership fees.
Hapag Lloyd set up an office in Barking, Essex, in January this year and had planned to open up several premises elsewhere in the UK to compete with rival companies such as American Express and CarlsonWagonlit.
However, in April it suffered a setback when it was told it would have to pay thousands of pounds for an ABTAlicence.This is because the association’s financial and bonding requirements are based on the whole of the company’s turnover and Hapag Lloyd would have had to register all its German offices as members of the association.
Hapag Lloyd asked ABTA to change the rules for overseas branches but the association refused so Hapag Lloyd let its application lapse.
Aspokesman for ABTAsaid:”Hapag Lloyd’s application lapsed because it was unwilling to accept ABTA’s jurisdiction over its operations outside the UK. It could have overcome this by incorporating a separate company in the UK but it did not wish to do so.”
Hapag Lloyd has 79 business accounts which Britannic Travel will now take over. Seven of the 12 staff in the Barking office will relocate to Britannic’s City of London or New Malden offices while the rest will return to Germany.
Britannic Travel is the UK partnership in an international network of business travel agents called First Travel. Its First Travel partner in Germany was acquired by Hapag Lloyd’s parent company, Hapag-Touristik Union, in the summer.