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European Council: New Travel Package Directive

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The European Council confirmed a political agreement on the reform of the Travel Package Directive. The new directive will update current EU rules on package holidays by aiming to adapt to travel market developments in order to meet the needs of consumers and businesses in the digital era. It will extend the protection for traditional packages to combinations of separate travel services, in particular if sold online. Latvian Minister for Economics, Dana Reizniece-Ozola, made the following comments:

“This piece of legislation will provide travellers and industry with the long-awaited framework which is fit for purpose and future-proof for the ever growing and evolving tourism industry. In particular, it will strengthen the rights of travellers when booking online and take into account new ways of booking. Beside strengthened consumer rights, businesses, in particular small and medium sized enterprises, will also benefit from this Directive”.

Furthermore, the new rules will increase transparency and strengthen consumer protection in relation to:

  • packages where two or more travel services are purchased either from the same trader on a website or from a high street travel agent under one contract;
  • “click-through” sales where two or more services are purchased from multiple on-line traders under separate contracts but where the traveller’s name, e-mail address and payment details are transferred directly between traders within 24 hours; and
  • linked travel arrangements, where at least two different travel services which are sold by a trader facilitating the travel arrangements for the purpose of the same trip or holiday.

 The future directive will contain other main features such as:

  •  Improved pre-contractual information requirements – before the conclusion of the package travel contract the traveler will be entitled to get clear and concise information on the main rights and obligations including specific standard information on the envisaged package travel or corresponding offer.
  • Fairer and more predictable prices for package travels, with stricter controls on price changes (termination rights in case of price increase more than 8% and a requirement to pass on price reductions in equivalent circumstances).
  • Improved termination rights– travelers will enjoy more flexibility by being able to terminate the contract before the start of the trip. In that case the traveler may be required to pay to  the organiser an appropriate and justifiable termination fee. Travelers will be able to terminate the contract free of charge, before the departure in the event of natural disasters, civil unrest or similar serious situations at the destination that would significantly affect the holidays.
  • Higher protection in cases where the traveler’s return is impossible because of unavoidable and extraordinary circumstances. Travelers will be entitled to compensation of up to three nights accommodation if they can not return home.
  • More effective rules on insolvency protection for travelers in case of the trader’s insolvency. A network of central contact points in the member states will be created to facilitate cross-border cooperation.
  • Stricter liability of traders in case of under performance of the package. The directive also lays down rules for cases of lack of conformity of the package, alternative arrangements, termination of the contract, repatriation or compensation of damages.

The new conditions will promote a level playing field for businesses by harmonising rules and removing obstacles to cross-border trade. This will generate a broader choice for booking holiday products and may therefore lead to cheaper prices for consumers.

Sources: European Council (1) (2)

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