The letter is from Frank Oostdam, President of ECTAA, the European Association of Travel Agents and Tour Operators.
This letter expresses our concerns regarding the upcoming revision of the Package Travel Directive, its likely consequences for small and medium-sized enterprises (SMEs) and competition in the travel industry, in particular with airlines.
ECTAA, the European Association of Travel Agents and Tour Operators, would like to express its concerns regarding the ongoing revision of the Package Travel Directive (PTD), which is expected to be released on 29 November 2023.
In line with the European Commission's Inception Impact Assessment on the PTD, our association has long advocated a thorough and joint examination of the PTD and Regulation 261/2004 on air passenger rights. In particular, given the shortcomings revealed by the COVID-19 pandemic within these two legislative frameworks, delays by airlines in reimbursing passengers for cancelled flights and the impact these measures had on travel intermediaries, a strong legislative response was called for.
Unfortunately, the lack of political ambition and divergent objectives of the Directorates-General have become clear in recent months and threaten the possibility of meaningful reform. While most of the passenger protection issues that arose during the pandemic were directly related to airline practices, it is surprising that DG MOVE seems to be leaning towards introducing minimum requirements for airlines in its upcoming review of passenger rights. On the other hand, DG JUST is set to propose stricter requirements for travel agents and tour operators, despite their limited involvement in the problems that arose during the pandemic.
Travel intermediaries are particularly concerned about DG JUST's intention to introduce a limit on advance payments in the upcoming revision of the PTD, specifically targeting package organisers. In our view, this is unnecessary, as the current Directive already provides significant safeguards for travellers in the event of package organisers' insolvency. On the other hand, the upcoming revision of the passenger rights framework will lack equivalent measures as no limit on advance payments is foreseen. Even protecting passengers' payments against airline insolvency will not be included or may only be addressed as an obligation to inform consumers about the availability of insurance (at an additional cost) to protect them from this risk. We have already communicated, together with other industry and consumer associations, about the lack of such a product on the market.
To make matters worse, according to the latest information gathered, it is being considered to limit the scope of the PTD by excluding loose packages sold by airlines via third-party intermediaries (e.g. car rental companies, accommodation platforms) from being categorised as linked travel arrangements (LTA). If the definition is indeed changed, airlines will be able to sell combinations of travel arrangements without having to comply with any of the obligations set out in the PTD, including the more limited LTA requirements. This potential loophole would benefit larger airlines that can offer unprotected combinations and distort fair competition to the detriment of smaller intermediaries.
In our view, the lack of coordination and joint efforts in these two important initiatives is a missed opportunity, and the differences between the two revisions under consideration will only exacerbate existing fragmentation. An unbalanced approach could undermine a level playing field in the travel industry and ultimately harm consumers by reducing the availability of travel arrangements due to new burdensome, burdensome obligations for organisers, especially small and medium-sized enterprises (SMEs).
Given the potential negative impacts these initiatives could have on smaller businesses, we would welcome the opportunity to discuss our concerns and explore alternative solutions in a meeting at your earliest convenience.
Frank Osstdam
President of ECTAA
