CAA will pull agents into line – TravelMole Comment by Jeremy Skidmore

The Civil Aviation Authority is about to make an announcement which will
have a huge impact on the life of many travel agents.

As many people know, it is drawing up new guidelines over the sale of
holidays in this new age of dynamic packaging.

Debate has been raging about how far the CAA’s guidelines will go. Are we
going to keep the status quo or will the regulations be tightened?

My understanding from talking to tour operators involved in some of the
crucial discussions is that we are in for a huge change.

Agents won’t be deemed to be creating a package if they don’t offer advice
or when flights and accommodation are bought at separate times.
But, most importantly, the agent will be creating a package if they make a
recommendation to a client and put together a flight with a hotel.

In practice, that will affect an enormous number of agents because how many do not offer advice? Only the bad ones.

If a  client goes into a shop, sits down and says he wants to book a holiday
to Malaga, an agent will, at the very least, point out which airlines fly
there and suggest some hotels or self catering  properties. That, technically, is offering advice.

The only way I can see a retailer getting around the rule is if someone
comes in and says they know exactly what they want and asks the agent to book it. Those people usually do it themselves over the  Internet.

So, what does it mean if an agent is suddenly deemed to be selling a
package? More bills, in a nutshell. They’ll need an air travel organiser’s licence, public liability insurance and have to pay VAT on the holiday.

This will inevitably put further pressure on agents and reduce their margins
further. But it will make it fairer for those companies that have played by
the rules and already invested in ATOLs.

But don’t think for a moment that the CAA guidelines will be watertight.

It has no  jurisdiction over airlines so there will be nothing to stop low-cost
carriers continuing to provide an Internet link to an accommodation partner
without the need for an ATOL.

Furthermore, consumers will have no protection when they buy direct from an accommodation provider in the UK, because the CAA cannot police foreign based companies. And, according to new ruling which sneaked through almost unnoticed before Christmas, if you make a purchase abroad by credit card, the card companies are under no obligation to provide financial protection in the event of something going wrong.

The  world has moved on dramatically since the Package Travel Regulations
came into  force in 1992 and the CAA is right to try to make changes to protect holidaymakers. Not surprisingly, it is keen to avoid scenes of stranded
holidaymakers beamed across television screens following the collapse of an unbonded company.

But the new system will be far from perfect and give many travel agents
another headache.

*What’s your view on the new guidelines? Send us your comments.