Back To the Future For Package Travel Commissioner Kuneva?
The news last week revealed that the CAA’s action against the Travel Republic now lies in tatters. Once again, the issue of Financial Protection remains smouldering on its own funeral pyre. Once again, the Travel Industry has split right down the middle between those that support the ‘Agency’ position and those that ‘support’ the CAA position!
A bystander to this sideshow could be forgiven for thinking, that the bringing of ‘criminal’ charges against any company and its owner was an indication that some terrible offence had been committed against society! Is it a really societal offence to fail to provide adequate financial protection to consumers or to fail to comply with such protection rules? Is it not in fact the case that the real offence to society, is to allow any major Industry to self regulate, without the necessary safeguards being put in place, to ensure that those who are responsible to Consumers for their money are indeed fit and proper persons/companies?
We find it interesting that Parliament has created such criminal offences for ‘administrative’ failures, yet it shies away from creating criminal offences against companies that knowingly or recklessly send holidaymakers to resorts where the conditions exist for those holidaymakers to suffer illness or injury. Whilst it is perhaps a subject matter for another time, it does reflect in our view an imbalance that must be addressed by legislators, both in the UK and in Europe!
So was it the case that Travel Republic was trading in a manner that was so wholly different to all its competitors? The simple answer is no! An examination of any of Travel Republic’s competitors reveals that every one of them is selling so-called DIY or Dynamic Package Holidays and Traditional Package Holidays. They will express the ‘difference’ between those holiday products by using the terms ‘Package Holiday’ ‘Flight & Hotel’ ‘Flights’ ‘Hotels’.
In describing the choice of holidays for the consumer, Travel Republic describe the DIY or ‘Flight & Hotel’ holiday as offering ‘Total Flexibility’, ‘Incredible Freedom’, ‘Massive Choice’, the ability to ‘Add Extras’, ‘Power to the People’ (an interesting social theory planted within a capitalist portal), and ‘Total Protection’ under their ‘Total Financial Protection Scheme’. The Package Holidays are described as offering ‘Simplicity’, ‘Leading Tour Operators’, ‘Inclusive Price’ and ‘Total Protection’.
We understand that the reason why Travel Republic were charged with criminal offences, was that it was alleged that they were in fact selling ‘Package’ holidays and not DIY holidays (flight & hotel) and therefore they could not rely upon their status as an agent to avoid obtaining an ATOL licence to financially protect their Consumers.
The debate once again centred on what is meant by the expression ‘Package’. The case against Travel Republic was deemed to be a test case, but in truth, if the CAA was so minded, a similar case could have been brought against one of any number of travel companies.
Consumers will wonder if my money is fully protected, what then is this furore all about?
Regular visitors to HolidayTravelWatch will be aware that since 2005, we have been campaigning to highlight the growing trend to create DIY or Dynamic Package Holidays. We have consistently argued that if this so-called ‘new’ business model is allowed to take a foothold, then the Travel Industry that will argue that they too sit outside the Regulatory Framework, not just of the ATOL rules, but also of the Consumer Protections of The Package Travel Regulations. It is the level playing field argument and in some ways it has merit. Whilst that may be the case, we argue that such a field should not be created on the altar of free market forces which could cast Consumers adrift.
To underline this serious concern, the decision in the Travel Republic case has potentially serious and wider implications than simply whether one company or not should hold an ATOL licence.
In our view, the aftermath of this case demonstrates a clear split between those within the regulatory environment and those who genuinely believe that they operate outside its provisions.
The Consumer could be forgiven for thinking that the headline stated in this case is that it is all about the future of financial protection, that may be, however, its implications are clear; if the court is correct in its assumption that a method of selling a product creates the notion that ‘we are all travel agents now’, then the temptation to rush to the ‘new’ business model will be irresistible and all responsibilities will therefore be logically avoided, not just on financial protection, but on health & safety, information provided to the Consumer and so on. In our view, the Package Travel Directive and the UK Regulations would become defunct, somewhat irrelevant and the Consumer would indeed be left to those free market forces!
If you need evidence of Consumer Detriment and how an Industry is adapting its own trading model to those free market forces, then you need look no further than the report we submitted earlier this year to the Commission and the daily calls to our helpline.
As a Consumer based society, if we are not careful on these issues, we will return to the ‘old’ world of holiday contracts and the Consumer detriment that existed prior to 1992!
Following the judgment, the MD for Travel Republic stated that (TravelMole 11/11/09),
“We welcome the clear judgment from the court and the dismissal of all charges against Travel Republic and me. Our position has been vindicated….This confirms that it is perfectly legal to sell more than one travel product at the same time….[we]…will always, act within the law, including the ATOL regulations, in their current, and any future form….process has been an expensive, unpleasant and gruelling diversion for the whole company and for me personally”.
Even though the Judge indicated that it was right to bring the prosecution against his company and him personally, we are left wondering why it was necessary to directly prosecute him in the first place; indeed, we had serious misgivings about this action when it was announced, surely the CAA could have represented its position to the EU Commission and the UK Parliament for the radical changes they were seeking; surely this major body could have presented a powerful ‘tour de force’ in its argument for change ? Was it not clear that the Courts are not the best arbiter in this dispute; surely this must be resolved politically?
Whatever the merits of going to court, in the legal debate on what constitutes a ‘Package’, we have seen a fair number of quirky arguments being presented; all designed to prove or disprove one particular point or another.
Looking now through the wasteland of CAA cases, we saw in the case of R v ABTA that it was suggested that buying a DIY or Dynamic Package was no different to going to the supermarket and buying a weekly shop! The lawyers clearly never ran a household nor organised the range of meals and its ingredients for a busy family! They clearly did not understand why a weekly shop was made, its general purpose and intention and the impact on that organised weekly shop following the failure to obtain the necessary ingredients from that supplier! It was in our view a bizarre analogy!
However, the award for the most bizarre analogy has to go to part of the judgment in the Travel Republic case. Referring to the terms and conditions contained within the Travel Republic website and how its booking process apparently makes clear that holidaymakers are not buying packages, the following analogy was used (TTGLive 10/11/09):
“To illustrate the point, with a silly analogy, say someone wants to buy a cow, he approaches a farmer who removes a horse from his field. On the side of the horse someone has painted the letters “COW”. Assume both the farmer and the purchaser believe that what is being sold and purchased is a cow. The transaction is concluded. “It doesn’t matter what they think, the purchaser has bought a horse not a cow.”
Really? Forgive us for saying (and we are not suggesting for one minute that this bizarre example and our following analysis applies in any way to Travel Republic – quite simply this ‘silly’ analogy was in our view the wrong analogy to draw in the Travel Republic case – we are certain there would have been puzzlement and perhaps some amusement amongst the ‘Defendant’ benches!), but if I am sold a ‘Cow’ which is really a horse, is it not the case that I have been missold that product – can we really believe that a farmer does not know the difference between a cow and a horse – can we really believe that a consumer does not know the difference between a cow and a horse? Is there not an inequality between the farmer and the consumer? Is it not the case that the farmer enjoys a greater level of information and knowledge than the consumer? Surely the farmer would be prosecuted for Misselling, Fraud and what about the Unfair Trading Regulation offences of Misleading Actions, Misleading Omissions and Aggressive Commercial Practices?
The implication is that a Consumer perception is irrelevant and that a contract is a contract between equals; can that really be correct?
It has been suggested by the Court that it was wrong to use the holidaymaker’s evidence to support the CAA case, presumably because their perception has no role or no value? If that was the case, then the analogy created with the horse and the cow surely demonstrated or invited the reader to assume a perception experienced by the farmer and the consumer – where is the logic and consistency within that analogy and the dismissal of holidaymaker’s evidence?
Given that society has deemed that not to hold an ATOL licence is a criminal offence, we have to ask whether it was or it is indeed right to dismiss direct perceptional evidence in a criminal trial; does a precedent exist in criminal law to consider and accept perceptional evidence? You will find the answer in homophobic, sexist, racist and discrimination cases, where the intention is not central to the offence being completed, rather the perception that was created by the said offending comment, on the people who witnessed that comment or by the objective view of ordinary citizens. It is in effect recognition of the ‘conditioning’ element or experience of society at large which allows for that all important perception to be accepted by the courts. Why then on such an important issue as this, was the Consumer perception not important?
The great legal minds, who consider the issues affecting consumers, really ought to get down onto the consumers level and understand their experience and how they have to cope with difficult and confusing issues and not create analogies that have no bearing in the real world!
Not to be out-done, it is interesting how the farm-yard has crept into the latest CAA case; in a reaction to the decision in favour of Travel Republic, Christian Cull, the Communications Director for Thomson and First Choice stated (TravelMole 11/11/09):
“Travel Republic insist they don’t sell packages, but if something looks like a duck, waddles like a duck and quacks like a duck, then it’s a duck….We are incredibly disappointed that the courts have not recognised this”.
Consider then these comments, for and against the Travel Republic decision and trail through the sections of the Travel Press. You will begin to see that the Travel Industry is waxing lyrical about Consumer Protection, but what protection are they actually talking about? Financial Protection!
Do not be fooled by this argument on a limited platform! It is an easy catch for the media and they too must take care not to readily accept that this is the only implication from this decision!
We are not saying that Financial Protection is not important, however, the upshot of any attempt by the Travel Industry to re-define the limits or the meaning of ‘Package’, is to reduce its overall effect so that it sits outside the provisions of The Package Travel Directive & The Package Travel Regulations.
If the learned Judge is right, then whatever the comments made that the decision only relates to ATOL licensing, we all know that the wider implication would suggest that indeed ‘we are all travel agents now’; travel agents that bear no responsibility for health and safety, information that should be given to a consumer and other rights enjoyed by British Consumers within the Package Travel Regulations.
Surely this is the debate on Consumer Protection? �
There are those within the Travel Industry who highlight the ‘new’ method of selling holidays through the DIY or Dynamic method as the ‘new’ Travel Industry and that the older players should now move over to let the new reality dawn. Let’s examine that claim; here are a few examples of some terms and conditions to be found in Travel Brochures apparently selling DIY or Dynamically Packaged Holidays:
“[Company Name] give notice that all tickets and coupons issued by them and all arrangements for transport or conveyance, or for hotel accommodation, are made by them as Agents upon the express condition that they shall not be liable for any injury, damage, loss, accident, delay or irregularity which may be occasioned either by reason of defect in any vehicle, or through the acts or default of any company or person engaged in conveying the passenger, or in carrying out the arrangements of the tour(s), or otherwise in connection therewith, or of any hotel proprietor or servant. Such conveying etc., is subject to the laws of the Country where the conveyance, etc., is provided”.
“In accepting any booking [NAME OF AIRLINE] and the travel agents (hereinafter collectively called “the Agents”) act as agents for the persons and companies producing the holiday (hereinafter called the “Organising Travel Agents”) and in no other capacity. The Agents shall not be liable to the person making the booking (hereinafter called “The Client”) for any loss, injury or delay, whether to person or baggage; resulting from any act or omission of any of the Organising Travel Agents”.
“We do not exclude or limit liability to you for our negligence or misrepresentation or that of out agents or servants who are involved in your holiday arrangements. We must point out that we do not own the carriers or hotels who are involved in your holiday arrangements and we have no direct control over them or any persons not employed by [NAME OF TRAVEL COMPANY]. Accordingly, we do not accept any liability for the actions or omissions of those involved in your holiday arrangements over whom we have no direct control and who are not employed by us as our servants or agents. However, we will give whatever reasonable assistance we can in resolving any dispute you may have with any one of them”.
The first ‘condition’ came from the Cook’s World Travel Service – Summer Holidays Abroad 1951;
The second ‘condition’ came from Silver Wing Holidays 1968 (then declared as ABTA members);
The third ‘condition’ came from Laker Summer Holidays 1982 (then declared as ABTA members).
So there is nothing new about the DIY or Dynamically Packaged Holiday; the same method of choosing was available then, the only difference now is that people choose from the brochure online!
So Commissioner Kuneva, when you or your staff meet the Travel Industry, spare a thought for that Travel Consumer and the web that has been tangled by teams of lawyers; do not be fooled into thinking that this is a solely a ‘British’ problem – it is an EU problem; do not be fooled into thinking that technology has created something new, the product is simply wearing a new coat and has the rules of the ‘old’ Travel Industry stuffed into its pocket!
It was this ‘Golden Age’ that led the EU to create the Package Travel Directive; to deal with the excesses and failures and to prevent Consumer detriment to all EU citizens! Check the now many ‘Agency’ websites and their terms and conditions; they bear an uncanny resemblance to the terms and conditions of yesteryear!
Commissioner Kuneva, are we being lulled into a past ‘Golden Age’ of travel that did nothing for the Consumer experience or the Industry itself? Whatever you do, do not forget history; do not fail the Consumer now!
HTW has noted that amongst the submissions to the Committee on Toxicity (COT) it has been suggested that the symptoms highlighted by crew and passengers were akin to the condition of hyperventilation.
HTW has for many years received reports from concerned holiday makers or independent travellers as to the safety of their aircraft, ship or boat, train or road transport.
