ABTA is calling on the Government to follow the European Commission in encouraging customers to accept credit notes for package holidays cancelled due to the coronavirus, as long as they can ask for a refund later if they don’t use them.
The travel association is warning that unless ministers relax the rules under the Package Travel Directive and allow companies to issue credits instead of cash refunds, some could collapse.
ABTA is also asking the Government to remove the requirement for companies to issue cash refunds within 14 days as travel companies try to deal with a deluge of cancellations.
Chief executive Mark Tanzer said: "Today, the European Commission updated its guidance on the Package Travel Directive in relation to customer claims refunds.
"It encourages customers to accept credit notes, as long as the customer is allowed to ask for a full refund, eventually, if he or she does not make use of the credit note towards a new booking.
"Crucially the Commission states that the credit note should be covered by appropriate insolvency protection. This is an extremely positive step and shows that the Commission recognises the strains being placed on tour operators due to Coronavirus.
"The Package Travel Directive is the legal framework on which the UK Package Travel Regulations are based, and we now need the UK government to follow the European Commission’s lead and confirm a similar approach.
"This new guidance will give customers the essential assurance that they will either get a holiday or their money back, as well as providing a much needed helping hand to travel companies through these difficult and unprecedented times."
