Firms trading as Teletext Holidays and Alpharooms flouted the Package Travel Regulations (PTRs) over Covid refunds, according to the High Court.
The court agreed with the Competition and Markets Authority (CMA) that Truly Travel and Alpha Holidays breached rules which required them to refund customers for package holidays that were cancelled due to the pandemic within 14 days.
The competition watchdog sought a declaration from the High Court to highlight the importance of travel firms respecting consumers’ refund rights.
More: Liquidators appointed to close down Teletext Holidays parent
Teletext Holidays parent leaves the Travel Trust Association
CMA launches legal action against Teletext Holidays parent
Because Truly Travel and Alpha Holidays have been placed into liquidation, Teletext Holidays or Alpharooms package travel customers with outstanding refunds are encouraged to submit a claim to the Travel Trust Association, which is now responsible for these.
The court decision does not affect this, the CMA said.
The CMA started court action against Truly Holdings and its subsidiaries Truly Travel and Alpha Holidays last year over outstanding refunds owed to customers.
Truly Holdings had previously signed formal commitments, known as undertakings, requiring them to use all reasonable endeavours to pay outstanding refunds to passengers in an agreed schedule, and to ensure that all refunds due for cancelled package holidays going forward were paid within 14 days.
The CMA took the company to court when it found that Truly Holdings was not fully abiding by these undertakings.
The court claim for refunds was paused indefinitely after the firms entered liquidation, but the CMA continued to seek a declaration from the court that these companies broke the law. This has resulted in today’s ruling.
The legal action follows consumer protection law enforcement work by the CMA in the package travel sector to secure hundreds of millions of pounds in refunds for people whose holidays were cancelled due to Covid-19.
CMA chief executive Andrea Coscelli said: “This should be a wake-up call to any business that thinks that it doesn’t need to honour customers’ refund rights.
“Today’s ruling confirms the CMA’s view that Teletext Holidays and Alpharooms broke the law by not providing the refunds customers were due within 14 days for cancelled package holidays.
“While this ruling comes after these firms have been placed in liquidation, we hope the decision will make it easier for people to get their money back for a cancelled holiday in the future.
“Customers of Teletext Holidays and Alpharooms with outstanding refunds should get in touch with the Travel Trust Association.”
Rory Boland, editor of Which? Travel, said: “Teletext Holidays attempted to shirk its legal responsibilities to refund customers within 14 days for cancelled trips, leaving its exasperated customers out of pocket for years.
“Holidaymakers have been badly let down, but this important court ruling means they should finally be able to claim the money back they are owed.
“Teletext is not the only holiday company to break the law over refunds in recent years. The government must ensure there are better protections for holidaymakers’ money by giving regulators stronger powers to take action against companies that break consumer law – including the ability to impose fines if necessary.”
More: Liquidators appointed to close down Teletext Holidays parent
Teletext Holidays parent leaves the Travel Trust Association