GLOSSARY

Every ABTA Member can be identified by its five-digit ABTA number – a unique combination of numbers, or of numbers and letters. An ABTA Member that’s acting both as agent and as principal will have two ABTA numbers – one for each activity. A Member trading from more than one office will have an ABTA number for each office.

The Accounts Rules (Article 10) are part of ABTA’s Articles of Association. Their purpose is to ensure that proper books and records are kept, and that these are submitted to ABTA in the right format, at the right time. The Accounts Rules make a significant contribution to the financial wellbeing of the ABTA membership as a whole, and so improve the business environment in which Members operate. 

See Retail

This is your total bondable turnover as a retail business, excluding: all foreign currency; 90% of sales of rail tickets issued under an ATOC agreement; 90% of sales of air tickets issued under an IATA agreement; and sales of scheduled stage fare bus and coach tickets within the British Isles.

Arm’s-length trading

Trading with connected companies or persons on the same terms as would apply to unconnected parties.

An ATOL is a licence to sell air transportation which provides financial protection for the consumer. If you’re acting as a principal and sell a package that includes air transportation, then UK law requires you to have an ATOL. If you’re in any doubt as to whether you should hold an ATOL, you should contact the CAA (Civil Aviation Authority), CAA House, 45-59 Kingsway, London WC2B 6TE; telephone 020 7453 6430.

Billing and Settlement Plan

For details please contact IATA.

A bond is a formal undertaking from an approved bank or insurance company to pay a sum of money to ABTA in the event of the Member’s financial failure, primarily for the purpose of reimbursing customers who would otherwise lose money which they had paid. The provision of a bond is an acceptable method of complying with the statutory requirements for customers’ financial protection under the EC Directive on Package Travel (the Package Travel, Package Holidays and Package Tour Regulations 1992-SI 3288/1992).

A bank or insurance company which issues a bond. A list of bond obligors recognised by ABTA can be found in the Resources section of our website - click on Publications and choose Bond Obligors.

Refundable deposits paid in advance to cover the cost of breakages, e.g. at a villa or apartment.

The Code of Conduct is designed to regulate the activities of Members between themselves and members of the public, other Members, and agents or principals or other persons who aren’t members of ABTA. The aims of the Code of Conduct are: to ensure that the public receive the best possible service from Members; to maintain and enhance the reputation, standing, and good name of ABTA and its membership; and to encourage initiative and enterprise in the belief that properly regulated competitive trading by and between Members will best serve the public interest and the wellbeing of the travel industry. 

Licensable business

Business transacted in the capacity of a tour operator (i.e. a person carrying on business in whole or in part as a principal to a contract with a consumer, either directly or through an agent or agents), in respect of the sale of air inclusive travel arrangements which require an ATOL, to sell or offer for sale, in any capacity, air-inclusive travel arrangements to the general public. This can include packaging travel arrangements as agent under two or more contracts.

The constitution of ABTA is laid down in two basic documents, the Memorandum of Association and the Articles of Association. The Memorandum sets out the objectives and powers of ABTA, while the Articles lay down the constitution and functions of the Board of Directors, the rules of membership and so on.

Non-licensable business

Non-licensable business is all principal business not covered by an ATOL.

Business transacted in the capacity of a tour operator (i.e. a person carrying on business in whole or in part as a principal to a contract with a consumer, either directly or through an agent or agents), in respect of the sale of inclusive travel arrangements that don’t include air travel and don’t require an ATOL but do, as set out in the Package Travel, Package Holidays and Package Tours Regulations 1992, require financial protection to be provided.

Because Members with non-licensable activities as a principal are bonded by us at the lowest rate permitted by the EC Directive on Package Travel (the Package Travel, Package Holidays and Package Tour Regulations 1992-SI 3288/1992), we’re required to have in place a back-up fund. This is provided by way of a shortfall insurance policy.

Principal business is business transacted in the capacity of a tour operator, i.e. a person carrying on business in whole or in part as a principal to a contract with a consumer, either directly or through an agent or agents in respect of the sale or offer for sale of travel arrangements, or who holds an ATOL to sell or offer for sale, in any capacity, travel arrangements to the general public. This can include packaging travel arrangements as agent under two or more contracts. Principal business is either licensable or non-licensable.

Rail Settlement Plan

A practising accountant with a professional accountancy recognised by ABTA.  In some cases a Reporting Accountant may be a Member's auditor.

Retail business is business transacted, in whole or in part, as agent for a principal, remunerated by commission or otherwise, in respect of the sale or offer for sale of travel arrangements. Agent businesses aren’t in contract with the client.

Business transacted in the capacity of a Tour Operator (i.e. a person carrying on business in whole or in part as a principal to a contract with a consumer, either directly or through an agent or agents), in respect of the sale of a single element, e.g. the sale of accommodation only as principal which, as defined in the Package Travel, Package Holidays and Package Tours Regulations 1992, does not require financial protection to be provided.

A supplementary amount requested from clients after the booking has been confirmed by the tour operator, and which is levied in addition to the original confirmed package price.

See Principal.

Non-inclusive travel arrangements sold as a principal. This normally applies only to bus and coach operators, shipping companies and airlines.

See Retail.

ABTA’s own captive insurance company in Guernsey provides this highly competitive scheme, currently used by 30% of ABTA travel agents as an alternative to bonding. Full entry into the scheme is only available to Members who have been in membership for three full years; some other restrictions also apply. However, all Members conducting retail activity are required to make some contribution into the scheme.

Travel arrangements are defined as transport, accommodation, tourist or business services and facilities, travel insurance, holidays, packages as defined in the EC Directive on Package Travel (the Package Travel, Package Holidays and Package Tour Regulations 1992-SI 3288/1992) or otherwise and any other arrangements designated as travel arrangements by ABTA’s Board of Directors from time to time.

The gross amount paid by the customer, i.e. gross invoice value.