CAA pushes for ATOL law change

Saturday, 06 Jan, 2003 0

The Civil Aviation Authority has announced that it will be recommending to the government that it make changes to the law regarding ATOLs.

In August the CAA produced a paper proposing changes to the statutory ATOL Regulations, but today’s announcement means that the CAA will be recommending the change to the Department for Transport. In a statement the CAA said it hoped the new regulations might be in effect by April 2003.

The changes to the law would mean that firms selling package holidays by air under separate contracts would need to be licensed.

A spokesperson for the CAA told TravelMole that the CAA had received about 100 responses from the industry during its consultation period, which ended on 23 November 2002. The spokesperson added that the CAA had discussed the issue with ABTA, AITO and other representative bodies before and during the consultation period.

ATOL, which is managed by the CAA, is intended to protect people who buy air holidays, but due to a legal loophole, some firms selling holidays under “split contracts” are not required to hold an ATOL, which could leave customers with little or no cover.

CAA director of consumer protection, Helen Simpson said: “There was a lot of recognition that contract splitting represents a real gap in protection, and general support for the way forward we suggested. We were particularly pleased that both the main trade bodies and consumer organisations endorsed the proposal”.

Ms Simpson said the consultation period had also thrown up some interesting points about a flaw in the system that meant scheduled airline sales weren’t protected even when passengers bought accommodation from a linked supplier. She said: “We can’t put forward proposals to deal with this in the short term because a change couldn’t be done by Regulations, but we’ll be looking further at the whole issue and may recommend more fundamental changes later.”

The CAA’s paper containing its recommendations to the Department for Transport is on the ATOL website.

The CAA claims ATOL has managed 330 operator failures in the past 16 years, returning about 190,000 people home from holiday and giving refunds to more than a million holidaymakers.

Read our previous stories:
06-Sept-2002 CAA asks for comments on ATOL issue
11-July-2002 Number of ATOL holders ceasing trading doubles
11-July-2002 Air Travellers’ watchdog calls for holiday levy
3-April-2002 CAA updates ATOL disclosure rules
2-April-2002 CAA pleased with number of ATOL renewals