CAA plans to abolish the small business Atol will add an average £1,150 a year to the costs of Atol compliance for smaller companies.
New rules and stricter financial criteria will apply to 950 current holders of Small Business Atols (SBAs), licensed for up to 500 passengers a year, and to all firms with Atol turnover below £5 million a year.
The CAA published details on Monday as it launched a three-month consultation saying smaller companies are at greater risk of failure and under-paying the Air Travel Trust by £1.6 million a year.
The changes are likely to come in from next April when SBA holders would need to choose between having their own licence under the new criteria, joining an Atol Accredited Body or an Atol franchise.
All Leisure Group chairman Roger Allard, a member of the Air Travel Insolvency Protection Advisory Committee (Atipac), welcomed the proposals, saying: “There have been too many failures of small Atol companies. Legitimate companies have nothing to fear. There are options out there. No one is trying to close anyone down.”
Leading industry accountant Chris Photi of White Hart Associates described the SBA as “a nonsense” and a proposed requirement for accountants signing Atol returns to be ‘licensed practitioners’ as “absolutely sensible”. Photi said: “It’s logical and the CAA is giving people a three-year transition period.”
However, Noel Josephides, Abta chairman but speaking as chairman of Sunvil, said: “This will penalise a lot of smaller companies who do not break the law.” He asked: “Why now, when we are waiting to hear what is happening with the Package Travel Regulations?”