Enforcers of the Package Travel Directive (PTD) across Europe have registered serious concern at key proposals for a revised directive now being discussed by committees of the European Parliament and Council of Ministers.
A meeting of “implementers and enforcers” of the PTD in London last November concluded by registering “serious concerns over the options given to travel firms to establish themselves in member states with the most favourable regime”.
The Civil Aviation Authority (CAA) issued a summary of the conclusions of the meeting today.
The implementers warn a switch from the current situation, where travel firms are required to abide by the regulations in the market where they sell to consumers, to one where they must abide by the rules in the country where they are established “will create a gap in protection”.
They point out this would mean “the exclusion of non-EEA [European Economic Area] organisers” from regulation and create “an uneven competitive environment” for EU-based companies, with “a risk that internet-based firms will move their operations outside the EEA to avoid these obligations”.
The enforcement bodies also declare the proposed mutual recognition of member states’ protection regimes “a mistake . . . without first establishing that all schemes provide sufficient protection”.
They point out that financial protection of holidays is currently provided “in various ways” around Europe “which tend to reflect the specific needs of each member state’s holiday market”.
But the proposed directive requires that states recognise the protection provisions in the EU country where a holiday firm is established “regardless of the effectiveness of those provisions.”
They warn: “This could have severe consequences for consumers.”
In the event of a holiday firm collapsing, it would mean consumers “having to seek assistance in a different member state” from where they live.
The enforcement bodies warn of consumers “having to seek assistance in another language . . . and potentially having to seek redress through the legal system of a country other than their country of residence”.
On top of the difficulties for consumers, this threatens to raise the cost of complying with the directive: “Each scheme will have to make provisions for consumers from different member states, adding to the complexity and cost of insolvency protection.”
Enforcement bodies from a majority of EU member states were represented at the meeting, with Germany the only significant absentee.