Peter Hill of the CMA provides a regulatory reminder for travel agents and tour operators
The Competition and Markets Authority (CMA) is the UK’s competition watchdog. It enforces specific rules aimed at protecting businesses and consumers in the travel sector from certain harmful practices and wants to remind you of these. These rules followed investigations some years ago into this sector by the CMA’s predecessors. The key points are:
- If you are a tour operator who sells foreign package holidays, you cannot prevent travel agents from offering extra incentives to customers looking to buy your holidays, either through agency agreements, or informal arrangements. For example, you can’t tell a travel agent to stop discounting one of your holidays. For more detail, click here.
- If you are a tour operator you cannot tell a travel agent to offer incentives on your holidays to match those of your competitors. For example, you cannot insist that a travel agent offers a discount on your holidays to match the discounts it is offering on a competitors’. For more detail, click here.
- If you are both a travel agency and a tour operator, with a market share as a travel agency or tour operator of over 5% in the UK, you should ensure that the links between the travel agency and the tour operator parts of your business are made clear to customers when they book. This will only apply to a very few large businesses in the sector. For more detail, click here.
- If you are either a travel agent or a tour operator you cannot charge customers extra if they do not take out holiday insurance directly with you. For more detail, click here.
If you run a travel agency or tour operator business, you should make sure that you are complying with all of the above rules where they are relevant.
Each of these rules has been in force for a number of years, and ABTA is happy to provide further information if required.
Consumer law (both specific and general) applies to travel contracts. The CMA published an open letter to all package holiday companies to remind firms of their legal obligations.
Peter Hill | Assistant Director (Remedies) | Remedies, Business and Financial Analysis | Competition and Markets Authority