What to Do if your Travel Operator Folds
GOLDTRAIL TRAVEL
It seems that hardly a year goes by without news of a travel company going bust, stranding thousands abroad and ending the holiday dreams of many more who have booked with that company.
The latest in a long line is Goldtrail Travel Ltd, which this weekend went under leaving an estimated 16,000 customers abroad with no immediate means of coming home. Goldtrail specialised in low cost holidays to Greece and Turkey and it is thought that as many as 50,000 holiday makers who have booked with the company over the summer will be affected.
Those travelling with Goldtrail have been turned away at airports, while those already overseas with the company are facing demands from hoteliers to pay for their accommodation, because they have been told that they (the hoteliers) will not receive compensation from the business.
Sadly, the days are long gone when booking with a ‘well known’ and ‘reputable’ tour operator means a guarantee that your holiday will take place without a hiccup. The current economic climate means that more tour operators than ever before are under pressure to provide cut price holidays with the smallest of profit margins (or none at all, which was the case with Goldtrail Travel Ltd). This can mean only one thing – Goldtrail may well be one of many tour operators to go out of business this year.
But before we all pack our passports away and despair of going abroad for a holiday ever again, there are rules and regulations in place to protect our interests as holiday buying consumers.
If your tour operator goes bust, the best way to ensure getting your money back is to book using a credit card or Visa debit card. If the worst happens you can make a claim via your card company. Consumer credit law puts the responsibility on the credit card company to refund customers if the goods they bought do not turn up or if the organisation they have purchased from goes under. In order to qualify for a claim, the total cost of the goods must be more than £100 but less than £30,000.
Anyone using a Visa debit card is covered by its Chargeback scheme, which offers similar protection to that provided to those using credit cards. In order to make a claim, customers must contact their card issuer (usually their bank) which then contacts the company’s payment processing bank to reclaim the money.
Before you travel, make sure that you have your travel insurance policy and contact numbers for your operator with you. If you are travelling to the EU, take your European Health Insurance Card (EHIC) and check with your tour operator (outbound) or local holiday representative (homebound) for any relevant information before leaving for the airport. Alternatively, call the CAA overseas helpline a couple of days before you are due to come home on 00 44 203 441 0846.
If you find yourself at the airport or ferry terminal and you learn that your tour operator is no more, sadly you will find that your tickets may not be valid. It should be possible for you to claim your money back through the Civil Aviation Authority’s (CAA) travel insurance plan, although this may depend on how your package was booked. You should make your claim promptly and ensure that you send full supporting documentation – it is vital to retain copies of everything.
If you are stranded abroad because your tour operator has gone under, the first thing you should do is speak to your local representative. The CAA will do all that it can ensure that airlines honour your ticket home via its Air Travel Organiser’s Licensing (ATOL) scheme by arranging travel on a chartered flight or an alternative if it can be found.
If you are taken to an airport that is not the one you flew from, arrangements will be made to get you to the original airport.
The CAA will also support you with claims for any additional sums you have had to pay for accommodation and in situations where the individuals who own your accommodation are demanding money because your tour operator has not paid them. In all cases, make sure you ask for receipts and keep them – you will need them when you make a claim to the CAA.
It is also a good idea to check your travel insurance policy to see what it covers. It is however unusual for travel insurance to provide cover in situations like this – the cover is provided by the CAA under the ATOL scheme mentioned earlier.
However, claims to the CAA or card companies do not cover everything. You will not be able to obtain compensation for loss of holiday enjoyment, inconvenience or loss of earnings. In addition, you will not be able to claim for the cost of booking a new trip or any insurance costs.
You can only claim for the expenses you have made. So if, for example, you have prepaid for an excursion that did not take place you may be able to recover its cost.
Going abroad on holiday should be a joyous, happy occasion, looked forward to by thousands every year. In most cases we travel abroad without a hitch, but it is good to know that there are systems in place to help us for when things go wrong. My final words? Prepare for the worst so you can get the best out of your holiday!
Samantha Pucci, Partner, Stones Solicitors LLP
Samantha Pucci is a Partner in the Stones Solicitors LLP Holiday and Travel Claims team. The team is one of the most respected of its kind in the UK and is recognised as such by independent legal ‘bibles’ Legal 500 and Chambers.