From 1 July 2009 ABTA Principals will benefit from a greatly simplified claims procedure when an ABTA retailer fails. Historically ABTA Principals have had to provide proof of payment from their clients to the failed retailer for a claim to be considered. This documentation had to be provided in very specific forms and often was difficult to obtain from clients. In addition principals had to provide evidence of specific written documentation showing they had chased retailers when payment was overdue.
The ABTA Board, following the recommendations of its Claims Review Group, has agreed that ABTA principals will no longer have to provide this documentation. This change will remove the occasional perception from Members that the ABTA claims procedure was overly rigid and inflexible and demonstrate that the relationship between ABTA and its Members is a mutually beneficial partnership.
In the past the claims documentation requirements involved extra work for ABTA Principals’ credit control departments and if not provided, led to claims not being paid. The new claims regime will lessen the work load for ABTA principals and ensure that all outstanding monies will be claimable.
ABTA Chief Executive Mark Tanzer said “This is a very significant change that is fairer to our Members and will make their lives much easier. ABTA is committed to helping our Members build and run successful businesses. I’m sure this change will be welcomed in the current difficult economic climate“
It will remain essential that Principals do not relax their usual credit control procedures and ABTA will still require some proof that these were in place and that debtors have been chased, but the evidence required will now more accurately follow standard modern working practices. All of this will clearly show that ABTA’s financial protection scheme is designed to settle ABTA Principals’ claims, not frustrate them.
The new regime will apply to claims against companies that fail from 1 July 2009 not to any claims against companies that failed before that date.