The European Commission has proved bolder than the UK in revising the Package Travel Directive. Ian Taylor reports
The European Commission unveiled significant revisions to the Package Travel Directive and additions to passengers’ rights at the end of November, including a requirement for airlines to refund package organisers in the event of cancellation.
The changes will not apply in the UK but companies selling across Europe will need to comply and the new rules will inevitably inform the decisions the Department for Business and Trade makes on reform of the Package Travel Regulations.
The EC proposes to enshrine the right of package organisers to a refund from service provides within seven days.
It notes “the lack of liquidity organisers faced” during the Covid-19 pandemic and argues: “Since organisers use downpayments from travellers to pay in advance for certain services included in a package, they depend on refunds from service providers in order to be able to reimburse travellers if the package is cancelled.”
At the same time, in a move that may concern many package organisers, the EC proposes to limit downpayments by customers to 25% of a package price, with the balance payable no earlier than 28 days before the start of the holiday.
However, the EC will allow a higher prepayment “when organisers face costs justifying a higher downpayment, for example, because they have to pay the full ticket price to the airline upfront”.
The EC has sought to clarify the rules on Linked Travel Arrangements (LTAs), adapting the definition of package so that “when services are purchased from separate traders through linked online booking processes, they are considered a package when the traveller’s personal details are transferred”.
Having learned from the pandemic, the revised PTD will allow the offer of vouchers in the event of a cancellation provided “travellers receive clear information on their right to insist on a refund within 14 days” and the vouchers are covered by insolvency protection.
The reformed PTD will also confirm that official travel warnings “are important when determining whether a package cannot be performed due to unavoidable and extraordinary circumstances”, and that “circumstances in the country of departure, residence and the destination may be taken into account”.
The associated EC revisions to passenger rights’ regulations include a requirement when flights are booked through intermediaries that the contact details of passengers are passed to the airline to ensure “passengers receive all relevant information directly from the air carrier”.
This will affect travel companies, and online travel agencies (OTAs) in particular, which sell flights on airlines such as Ryanair without distribution agreements.
However, the EC states the passenger data must be transmitted “for this purpose alone” and notes: “Air carriers will face sanctions if they use this data for any other purpose.”
The Commission also proposes to “look into the protection of passengers in the event of insolvency of air carriers”, an issue which the UK government shows no sign of re-opening.
In addition, the EC presented new rules to extend protections to passengers using different types of transport to make a single trip or “multimodal journey”, including information requirements and payments when connections are missed.