Foreign Office advice against all but essential travel to Spain has triggered a confrontation between Abta leaders and Abta members On the Beach and Loveholidays over consumers’ right to a refund.
Abta policy and industry practice have for decades been that tour operators cancel holidays and refund customers if the Foreign Office (FCO) advises against travel to a destination.
But On the Beach and Loveholidays, the third and fourth-largest Atol-holders, are refusing refunds on the flight elements of package holidays to Spain unless the airline cancels and pays a refund.
On the Beach chief executive Simon Cooper told customers last week: “Industry practice is not law. It is something which can and should change.”
Abta reaffirmed its policy last week following a board meeting, confirming: “The board agreed unanimously that Abta members should offer refunds to package holiday customers where the Foreign Office advises against travel.”
Cooper questioned the legal basis for this, citing the Package Travel Regulations (PTRs) and telling customers: “The legal position is very clear that FCO advice does not automatically trigger [a refund].”
He noted FCO advice on Spain “has not triggered widespread flight cancellations” and said: “If the airline cancels the flight and refunds us, we will pass that refund back to the customer.”
Leading industry lawyer Stephen Mason, senior counsel at Travlaw, said the 2018 PTRs leave space for legal interpretation of the right to a refund when a holiday is cancelled.
Mason said: “Is there something different about multi-contract packages? Before the 2018 regulations, the consumer would just have a contract with the airline and a contract with the hotel and there would be no package. The 2018 PTRs superimposed on that the responsibility of a travel organiser.
“I don’t know that it does make a difference – the idea of the PTRs was to create a level playing field between tour operators and OTAs.”
The PTRs make no reference to Foreign Office advice, but give consumers the right to cancel with a full refund in the event of “unavoidable and extraordinary circumstances at the place of destination or its immediate vicinity . . . which significantly affect the performance of the package or the carriage of passengers to the destination”.
Mason said: “What is meant by ‘performance of the package’? Does it mean ‘is the hotel open?’ or does it mean ‘is the holiday experience seriously affected?’”
He added: “There is also the duty of care, which is significant.” Travel organisers’ duty of care to clients comes from case law, not from the PTRs.
Mason pointed out: “The courts are naturally on the side of consumers. A travel company needs a watertight case that the money is not refundable. The question of whether the airline cancels and refunds is irrelevant if performance of the package is found to be affected.”
More: Abta to write to members over FCO advice refunds dispute
On the Beach chief defends stance on Spain cancellations
