Covid-19 has not only cancelled flights, but tourist packages of all sorts too. Often, the consumer resorts to a travel agent to sort out his holiday for the consumer’s convenience, and the package offered will usually include a variety of separate services such as flights, accommodation and transportation. The role of the travel agent is usually that of an intermediary selling travel services against commission. This means that agents often do not own the services being sold, and in case of an extraordinary event such as Covid-19 happening, they get caught between the frying pan and the fire having to deal with the consumer on one end, and the actual service provider on the other. However, at law, the agent remains ultimately responsible to the consumer for the performance of the travel services.
Travel agents still offer services to consumers, and hence the consumer is always to be protected. Whilst travel agents also suffer the effects of an event such as Covid, as an intermediary, they remain ultimately answerable to the consumer as the legal relationship would be between the consumer and the travel agent. It would be unreasonable to expect the consumer to have to battle it out with the individual providers he/she never communicated with.
The applicable law in this respect is EU Directive 2015/2302 on Package Travel and Linked Travel Arrangements. It is applicable only insofar as a consumer engages the agent for more than one service, which can be considered to be a package or linked services. For example, if the consumer only buys flights through the travel agent, the rights afforded in this Directive will not apply; general contract law will.
Some persons may have cancelled with the travel agent themselves. In this case, the agent will be entitled to demand a reasonable termination fee. This should be clearly stipulated in the paperwork the agent requires the consumer to sign, once the booking is placed. Such termination fee would be inapplicable if the cancellation is due to unavoidable circumstances, such as Covid-19.
When it is the agent, as organizer, who cancels the package or linked services, he is bound to provide the consumer with a full refund of any payments made by the consumer. A situation such as Covid-19 exempts the agent for being liable towards the consumer for further compensation over and above payments made.
In any case, the agent is bound to effect the refund within 14 days of cancellation. Since right now, travel agents, like operators in other sectors, threaten with insolvency should a consumer insist on a refund, reader must be aware that according to Law, all travel agents must have security in place for effective refunds, should the travel agent be forced into insolvency. This is consumer protection at EU level in action.
Since the outbreak of Covid-19, travel agents are said to be offering travel vouchers instead of refunds. EU law makes no provision for travel vouchers in this case, unlike in the case of cancelled flights booked directly with airlines. The law speaks only of refunds, intended to be cash refunds. Whilst keeping in mind this right, it is up to the consumer to decide whether or not to accept a travel voucher by way of refund, regard being had to the consumer’s personal circumstances and convenience. A consumer cannot be forced to accept a voucher.
Just like in the case of flight cancellations, the European Commission has issued non-binding guidelines in the case of package travel cancellations due to Covid-19, with a revised version dated 19th March 2020. Unlike the case of flight cancellations, the European Commission encourages dialogue over the strict enforcement of consumer rights.
First and foremost, according to the European Commission, the present circumstances are exceptional enough to allow both the consumer, and the agent, to cancel the travel arrangement without penalty. For the consumer, this means that the agent cannot impose or enforce a termination fee and must provide a remedy in full.
Secondly, The European Commission encourages consumers to accept the postponement of their package to a future date, possibly against the issue of a travel voucher or credit note. However, whereas this is not binding on the consumer, the Commission reiterates that should the consumer insist on a cash refund, he/she remains entitled to it. The Commission encourages this course of action due to concerns of strains on liquidity on tour operators.
In conclusion, if the reader’s package tour, or linked services, booked with a travel agent, were cancelled specifically due to Covid-19, whether by the reader or the agent, the reader is entitled to a full refund of any monies paid from the agent. The agent may offer vouchers or credit notes as alternatives, but this cannot be forced upon the reader. The reader needs to see what suits him/her best in his/her personal circumstances. The choice remains that of the consumer.
Should the reader feel that the travel agent is disregarding his/her rights, professional advice should be sought.
This article is not intended to constitute legal advice. If you are a passenger whose flight has been cancelled due to COVID19 and are in doubt of where you legally stand please contact us on firstname.lastname@example.org or 21223515.