Agents will have an “unpalatable” and confusing message to give clients if selling a holiday defined as a Linked Travel Arrangement (LTA), according to Abta chairman Noel Josephides.

Addressing the Association of Independent Tour Operators’ Overseas Conference in Jordan, Josephides warned customers would be confused by agents explaining that an LTA holiday would only be financially protected if the retailer fails, not if suppliers of holiday components collapse.

Josephides said: “It’s a clearly unpalatable message to give clients. You have to explain that if the components fail it’s nothing to do with you. You are going to have to explain that what you are putting together is not a package.

“The customer is going to be completely confused.”

The new regulations are due to come into force in 2018 under the EU Package Travel Directive, which extends the definition of a package to what are now Flight-Plus bookings in the UK and creates the new LTA category for bookings where a customer buys one holiday element and then books a second to go with it within 24 hours.

The LTA is chiefly intended to apply to ‘click-through’ sales between websites. But it would also apply if a customer books a flight through an agent and returns within 24 hours to book a hotel for the same trip.

Abta head of financial protection John de Vial said explaining LTAs would require a “big education process”. He said: “Agents will come under the scope of regulation in a way they haven’t done before.”

Agents could find they are selling LTAs for 2018 before details of the regulations have been finalised, warned De Vial.