The CAA has invited businesses to tender for the takeover of holiday bookings of failed companies, heightening fears of a spate of failures in coming weeks.
A majority of Atol licences fall due for renewal at the end of this month.
Alan Bowen, legal advisor to the Association of Atol Companies, said: “Many Atol-holders assume the CAA must be expecting a mass of failures which would require repatriation or refunds.”
However, a senior industry source described the CAA’s action as “sensible contingency planning”.
Bowen told Travel Weekly: “The CAA has asked before if people would take over bookings – it did when Thomas Cook failed. But people have never seen anything like a formal tender process. It looks like planning for failures.”
Bowen said: “None of my clients wanted to take on the risk. Companies fear if they take over bookings they will face having to refund customers and they don’t want the hassle.”
He warned: “If this goes on, we’re going to see mass failures. If we lose Portugal and Greece [from the travel corridors list] there will be failures this month. The problem will be for those companies living hand to mouth before this started.”
The industry source agreed: “There is a lot of work to do for a fair few smaller companies, [but] the CAA has done this before. The CAA is conscious of the relative limits to its in-house capacity. It’s sensible contingency planning.”
Travel Weekly understands the CAA has previously used a ‘fulfilment partner’ to help with Atol‑holder failures and put the contract out to tender in the interests of ‘good governance’.
Abta chief executive Mark Tanzer told Travel Weekly: “A lot of members have taken difficult measures to get in shape for the September Atol renewals, talking to their financial providers. People have been taking steps in any way they can to prepare themselves.”
He insisted: “These are good businesses. Even the most pessimistic people don’t think the travel market has disappeared. It’s a question of when it’s going to come back and making sure we build confidence to get it back as quickly as possible.”
