ABTA is seeking changes to the Package Travel Regulations to help Members who are required to refund customers due to cancellations resulting from the Covid-19 crisis. As those discussions with the government continue, ABTA has modified its scheme of protection as set out below to allow the issue of protected Refund Credit Notes in place of immediate cash refunds. Please note this does not change the position regarding general holiday vouchers or holiday savings schemes. We hope that this measure and guidance will assist Members in navigating this crisis and maintaining consumer confidence.
Holiday vouchers and other financial incentive schemes – General Position
The ABTA and ATOL financial protection schemes do not protect monies paid for vouchers or other discount vouchers, points or holiday savings schemes.
They only protect customer monies paid for travel arrangements that have been booked under the protection schemes.
This position remains unchanged and any vouchers or other discount vouchers, points or holiday savings schemes must contain the following statement which is required by the ABTA Code of Conduct:
This voucher is not covered by ABTA’s scheme of financial protection
Customers should also be aware that under the ATOL Air Travel Trust Payment Policy there is no protection for any non-monetary loss. For example, where the consumer uses a complimentary voucher, loyalty reward points or airmiles in lieu of payment against the cost (in full or in part) of a protected booking.
The Air Travel Trust (ATT) Payment Policy can be found at; https://publicapps.caa.co.uk/docs/33/20122407PaymentPolicyFinalpdf.pdf
Refund Credit Notes for cancellations as a result of the Covid-19 crisis
ABTA Scheme of Protection
The ABTA scheme of protection is now extended to Refund Credit Notes issued in place of immediate cash refunds following the cancellation of travel arrangements that were originally protected under the ABTA scheme of protection because of the Covid-19 situation.
This means that monies covered by such Refund Credit Notes are protected in the event of the failure of the travel organiser.
The consumer has the right to redeem the Refund Credit Note against a future booking with the travel organiser or to receive a cash refund.
Refund Credit Notes must be issued within 14 days of the date of cancellation of the original booking and must be redeemed against a future booking or exchanged for a cash refund.
The value of the Refund Credit Note must be equal in value to the consumer pre-payments actually made for the protected travel arrangements.
The Refund Credit Note must not include any other value offered as a rebooking incentive or other offer. Such offers must be documented separately and the consumer must be made aware that they are not covered by any scheme of financial protection. Such offers, once redeemed, will not form part of the protected value of the new booking.
The Refund Credit Note must expressly identify the original booking reference and attach a copy of the cancelled Booking Confirmation / Cancellation Invoice and, where appropriate, ATOL Certificate.
ATOL Scheme of Protection
As stated above, under the ATOL Air Travel Trust Payment Policy there is no protection for any nonmonetary loss. For example, where the consumer uses a complimentary voucher, loyalty reward points or airmiles in lieu of payment against the cost (in full or in part) of a protected booking.
However, refunds for ATOL protected bookings are covered and ABTA’s recommendation to Member travel organisers is to follow the procedure for issuing Credit Refund Notes set out above in relation to ATOL bookings as well.
In the event that the Package Travel Regulations are amended temporarily to reflect the reality of the situation, we will review this guidance.
John de Vial Director of Membership and Financial Protection