The law on Package Holidays: For tour operators and other agents

This article is based on the Package Travel Regulations 1992: what they say and how they affect businesses and customers. The article is directed at businesses such as tour operators and travel agents.

 

In the UK, anyone who (more than occasionally) sells or offers for sale package holidays must comply with the Package Travel Regulations 1992.

 

These set out travel organisers’ responsibilities to their customers and the remedies available should there be a breach of the Regulations.

 

As this is a reasonably long article, we have split it up into four sections:

• What is a “package” holiday?
• Continuing obligations - After the holiday is sold;
• Further obligations once the consumer has ‘gone away’
• Compensation and defences.

1.	What is a “package” holiday?
‘Package’ is defined in section 2(1) of the Regulations. A package must include at least two of the three component of a holiday. Broadly, there are:
Transport; Accommodation; Other tourist service which compromises a significant proportion of the package.
Additionally, the package must extend over 24 hours or more, or include overnight accommodation. Therefore if you organise day trips which compromise entry and a bus ride (for example), the regulations will not apply.
Lastly, the package must be sold at an “exclusive price”. If the components are paid for separately, this is not a package. However, this does not mean it is possible to invoice for separate items only to escape the regulations.

 

• Putting on ‘murder mystery’ themed weekends at your country home;
• A travel agent offering and selling accommodation, flights and day trips to newlyweds;
• Hiring out your canal boat, with the addition of providing bicycles, maps and further booking hotels for your customers;
• A skippered yacht tour through the Whitsunday’s (where the yacht belongs to you, or another);
• Organising and selling fly / drive holidays.

 

• Day trips which include entry into a State House and the bus ride there and back;
• Organising a holiday for the members of a club (who have already decided to go on holiday), to which you belong;
• Letting out a holiday home for yourself;
• Letting out a holiday home on behalf of a friend;
• Putting on a special Christmas entertainment package for all the guests at your hotel;
• Hiring out your canal boat;
• Providing accommodation on an over-night trai.

 

They apply to those who ‘put together’ and offer holidays for sale. This includes all tour operators, travel agents etc. If you put together a holiday say, on behalf of members of your social club, it is most likely that the regulations do not apply. In this example, the members have decided to organise the holiday themselves and have merely appointed you as their organiser. However, if you offer a package for sale, the regulations will apply.

 

The regulations do not define “occasionally”, however, it is thought to mean regularly, even if this is infrequently. To be prudent, assume the Regulations apply.

 

The rules have been established to implement a European Directive which binds all member states, therefore similar provisions will apply universally in such member states. However, these UK Regulations do not apply to packages sold in other countries by operators established in the UK. They will have their own specific regulations to implement the Directive.

 

You do not have to provide brochures. However, if you do, they must contain specific information. Consumers can sue for damages if you do not provide what you offer. The damages they can claim extend to financial loss and even for disappointment.

 

• The destination and the means, characteristics and categories of transport;
• The type of accommodation, it’s location, category or degree of comfort, it’s main features and it’s tourist classification under the rules of that Member State;
• The meals which are to be included;
• The itinerary;
• General information about passport and visa requirements, including health requirements;
• The monetary amount (or the percentage) of the price which is to be paid and the timetable for payment of the balance;
• Whether a minimum number of persons is required for the package to take place and, if so, the deadline for informing customers in the event of cancellation;
• Arrangements which apply if delays occur; and
• Arrangements for security of money paid over and for the repatriation of the consumer in the event of insolvency.

 

This information is provided for in regulation 7. Before a contract is concluded, the consumer must be provided in writing (or another appropriate form, which could include over the phone), the following information:

• General information about passport and visa requirements, including the likely length of time it will take to acquire visas;
• Information about health requirements for the journey and for the stay;
• Arrangements for the security of the money paid over and (where applicable) for the repatriation of the consumer in the event of insolvency.

 

This depends on the specifics of the holiday being bought. This part is governed by regulation 9 and Schedule 2 to the Regulations. You must tell the consumer:

• The travel destination(s), and where periods of stay are involved, the length of time at each destination;
• The means, characteristics and categories of transport to be used and the dates, times and points of departure and return;
• Where the package includes accommodation, it’s location, degree of comfort, main features and if in a Member State, the rules for compliance in that Member State;
• Meals which are included;
• Whether a minimum number of persons is required for the holiday to go ahead, and if so, the deadline for informing consumers of cancellation of the package;
• The itinerary;
• Visits, excursions and other outings which are included in the price;
• The name and address of the organiser, the retailer and where appropriate, the insurer;
• The price of the package, any dues, taxes or other fees chargeable that are not included in the package;
• The payment schedule and the method of payment;
• Special requirements (which the consumer has communicated when making the booking) and either the retailer or the organiser have accepted;
• Timeframe within which the consumer can make a complaint.

 

You must give the consumer a written copy of the contract. The Regulations do not state when this must be done, however, Net Lawman suggest you provide this at contract formation.

 

Any special requirements communicated by the consumer to either the retailer or the organiser, which has been accepted by either, must be included in the contract.

 

Yes, if you like. The only rule in the regulations is that you inform the consumer about an insurance policy to cover the cost of cancellation by the consumer or the cost of assistance in the event of emergency which the consumer may wish to take out.

2.	Continuing obligations - After the holiday is sold

 

If you want to change the contract, you should tell the consumer immediately. The consumer than has a choice either to agree to the amendments, or to withdraw from the contract without penalty.

 

A surcharge may only be applied if the increase relates to variations transport costs, taxes or fees for certain services, and exchange rates. If you are going to apply surcharges, the contract must state that this is a possibility, and if so, how much the surcharge might be, or a percentage of the total cost, representing how much the surcharge might be.

 

You must tell the consumer all pre-contact information, in good time (i.e. before the holiday starts). This includes:

• The times and places of intermediate stops and transport connections, including where the consumer should go during these connections (i.e. should they stay on board, in their cabin etc);
• The names, addresses and telephone number(s) of:

a. Agent representatives in the area they will stay in, or;   b. If no agent exists, a second agency in that locality, where they can seek help.

 

If the consumer cannot go on the package for circumstances outside of his control, he may transfer his booking to another person. This might mean the package is transferred to someone on a waiting list and not someone chosen by the consumer.

 

3.	Further obligations once the consumer has ‘gone away’

 

Yes

 

You are liable to the consumer for anything that goes wrong which is caused by the improper performance of the contract.

 

A tour operator cannot limit liability for personal injury or death. He can limit his liability for other loss or damage as long as it is reasonable.

 

If you are organising flights, or air travel, you may need to hold an Air Travel Organiser’s License.

 

4.	Compensation and defences

 

There are 2 defences to any claim:

• If the damage was the fault of a third party not connected with the contract and the failure in question was unforeseeable or unavoidable;
• Of if the damage was due to:

a. Unforeseeable circumstances beyond their control, the consequences of those circumstances could not be avoided if all due care had been exercised, or   b. An unforeseen event.

 

In all of these, the defendant must be able toshow that he took all reasonable steps and exercised all due diligence to avoid committing the offence. Therefore, if you can prove that your actions were reasonable in all the circumstances and that you did your best to avoid a breach of the contract, the claimant is likely to fail with their claim.

 

• To the act or default of another; or
• Reliance on information given by another.

 

The defendant is unlikely to be able to rely on the defence unless he has served a notice on the person bringing the proceedings.

 

The notice to be served on the claimant must provide information identifying the person who committed the act (or default).

 

Of course if the damage was due to the fault of the consumer the organiser will not be guilty, therefore no defence is applicable.

 

Where the offence was caused by an employee (for example), the employer will be guilty of the offence jointly, whether or not proceedings are taken against the employee.

 

Simply put, a business is vicariously liable for its employees.

 

Compensation can only be awarded for loss suffered. This extends to financial loss and disappointment.