Package Travel Directive

June 2012 | August 2011 | June 2011 | April 2011 | December 2010 | May 2010 | March 2010 | December 2009

Update June 2012
There have been further delays in drafting the revision of this directive. Publication is not now expected until January 2013.

Update August 2011

It now looks as though the new proposal for reforming this directive will not be published until summer 2012.

 The issue of dynamic packaging and knowing when holidays booked this way count as packages continues to cause difficulties. EC officials are looking at ways of ensuring that consumers booking packages online know immediately whether they are covered by the directive or not.

When it eventually appears, the directive will be scrutinised by the European Parliament's Internal Market and Consumer Protection committee. The chairman of that committee, Malcolm Harbour MEP, is said to be considering organising a public hearing later this year (in the autumn) together with the Transport and Tourism Committee.

Update June 2011
The earliest date for publication of the proposed new directive is still the end of the year, although there is also a chance that it will be put back into 2012.

The Commission's aim is to publish one package of legislative proposals including the new package travel directive and a separate measure dealing specifically with airline insolvency.

It seems likely that the new package travel directive will be broader in scope than the current one. It is possible, for example, that individual travel items will be caught by it if the consumer perceives that he is buying a package (as for example booking extra services through an airline website - the dynamic packaging issue). Single items on their own - such as a stand-alone accommodation booking - are likely to remain outside the scope of the directive.

The secretariat will continue to monitor developments.

Update April 2011
A formal proposal for revising this directive is not now expected until the end of the year.

The main reason for the delay is the decision to await the outcome of parallel work by the Commission on airline insolvency and protection for holders of scheduled airline tickets. The EC commissioned a study on 'passengers' protection in case of airline insolvency' last summer and this is expected to be published shortly - with legislative proposals likely at the end of the year.

The delay in publication of the revised package travel directive (PTD) shows that the Commission is aware of the potential for overlap between the provisions of the PTD and measures taken to protect scheduled airline passengers. Indeed, one of the options put forward by the Commission last year for inclusion in the PTD was insolvency protection for holders of airline tickets purchased as standalone products. This may not now be needed if other insolvency protection rules are introduced.

The secretariat will continue to monitor developments.

Update December 2010
A new proposal for legislation to replace the existing directive is expected by the end of June 2011. The main difficulty facing European Commission officials is how to cover 'dynamic packages' in the new text. These are packages that European Parliamentconsumers put together for themselves, typically (but not exclusively) after booking travel through airlines' websites. In some cases, the airlines offer consumers the chance to book additional services directly on their own websites; in others, consumers are invited to 'click through' to external sites with links to the airline. Services could include booking holiday accommodation or car hire.

There are also calls from some bodies to extend the directive so that it applies to single services and not just to packages. Calls are loudest for flight-only bookings to be covered, but some consumer groups are keen to see other forms of transport and even tourist accommodation brought within the directive's scope. There is no evidence as yet that the Commission is thinking of applying the directive to accommodation-only bookings; extending it to purchasers of flight tickets is, however, being considered seriously.

An impact assessment of the Commission's ideas for revising the directive is expected to get underway this month.

Update May 2010
At a well-attended workshop in Brussels on 22nd April, the EC consulted travel and tourism industry representatives and consumer organisations on its ideas for reforming this directive. Officials hope to publish a full legislative proposal in March 2011. In the meantime, work is beginning on an impact assessment for revising the directive and should be complete by the autumn.

The main focus of the meeting was a series of eight policy options drawn up by EC officials as a basis for discussion. These options ranged from the highly improbable 'no change' to far-reaching ideas which could see the directive being extended to cover stand-alone travel products such as car hire, accommodation and seat-only travel by air and rail.

There was general agreement that dynamic packages should be brought within the scope of the directive, but agreement was not so unanimous on other issues. Consumer organisations were very keen on stand-alone products being included, while the industry representatives were not (except in the case of insolvency protection for air travellers). Tour operators and travel agents wanted to see the suppliers of products included in packages becoming directly liable to consumers under the terms of the directive; consumer organisations were less enthusiastic, believing that such a change would introduce unnecessary complications for consumers, who invariably regarded the tour organiser as their sole point of contact.

Inevitably, there were concerns about the implications of some of the options in the different EU member states. Indeed, there were comments about discrepancies in the attribution of liability in the current directive. Yet there was little enthusiasm for a pan-European fund to protect consumers against the insolvency of tour organisers. Industry representatives preferred the national approach which reflected the characteristics of individual markets.

Update March 2010
Work continues in the European Commission on plans to revise the current, very outdated package travel directive. Officials are now considering responses to a consultation held at the start of the year and will decide shortly on the approach they wish to take. The latest information we have is that a new legislative proposal is expected early in 2011.

Another consultation meeting with industry, consumer and government representatives is planned for 22nd April in Brussels.

The main reason for revising the directive is to ensure that it responds to the many changes that have occurred in the travel market since it was first introduced in 1990. These changes include, of course, the advent of the internet, low-cost airlines and the increasing popularity of dynamic packaging (consumers putting their own packages together online). The Commission is concerned that consumers believe they are protected by the directive when they are not. The proportion of consumers covered has, in fact, fallen considerably in recent years.

Update December 2009
The European Commission is considering plans to revise this directive, which was introduced in 1990 to offer greater protection to purchasers of package holidays. Packages are defined as consisting of at least two of the following three key components: transport, accommodation and other tourist services not ancillary to transport or accommodation and accounting for a significant proportion of the package.

There is widespread recognition in the tourism industry that the directive is outdated. It was introduced at a time when nearly all package holidays were created by tour operators and bought direct from them or from travel agents. Things have changed since then, not least because of the advent of the internet and its impact on the way that people buy their holidays.

An important change in any new directive is likely to be the redefinition of 'package' to include dynamic packaging, whereby people put together their own packages through, for example, the website of a low-cost airline offering (separately) flights, accommodation and car hire.

Other questions that need to be looked at include the following

→ Pre-contractual information requirements
→ Organisers' liability (and, indeed, the definition of "organiser")
→ Pricing of packages and the ability for organisers to increase prices to meet cost increases
→ Financial guarantees for consumers (currently a mix of national bonding and insurance schemes).

Following public consultations, the European Commission launched a consumer detriment study last year. This is intended to be an assessment of the problems faced by consumers in booking holiday packages and it's being carried out by external consultants.

Before any proposal for a revised directive is published, the EC will have to carry out an assessment of the impact of their proposal on the industry. This, too, is likely to involve external consultants and it represents an important opportunity for the industry to influence the final shape of the proposal.

You can find the consultation here. Publication of the draft new directive is expected in 2010.

The work on the package travel directive comes against the background of important wider proposals for the reform of EU consumer legislation.

One proposal already on the table is a draft new directive on consumer rights and there is also a consultation being held on the possibility of EU legislation on consumer collective redress.

The directive on consumer rights is intended to bring together four existing directives on unfair contract terms, distance selling, doorstep selling and consumer sales/guarantees. Unusually for a directive, this proposal is intended to ensure that consumer rights are fully harmonised across Europe. There will be no scope for national variations in protection. It is a controversial proposal and one that could take several months to go through the European Parliament and the Council (member states).

The main tourism interest lies in the future rules governing distance selling. There is an exemption for the accommodation and transport sectors from the rules governing consumers' rights of withdrawal from contracts. This was created for sound practical reasons: to protect accommodation and transport providers from being left with extra capacity that needs to be filled at very short notice. The new proposal retains this provision, but consumers' representatives have made clear their intention to oppose it. IAAPA and its NET colleagues will be watching this one closely.

The consultation on consumer collective redress is intended to open the door to proposals which will facilitate redress in situations where large numbers of consumers have been harmed by a single trader's practice which is in breach of consumer law.

Once again, the idea is to have harmonised, pan-European rules so that citizens of one member state have the same protection and options as those in the others. It could lead to a weakening of consumer protection in those countries which already have strong laws on consumer redress.

Transport, package travel and tourism have been specifically mentioned by the European Commission as sectors to which any new legislation would apply. The consultation document refers to "bogus holiday clubs in Spain" and action being taken against an airline which refuses to provide alternative transport and/or accommodation when it cancels a flight.

Tourism industry representatives dispute the need for such a pan-European measure when there is adequate protection provided at national level. However, the fact of the consultation document being issued implies that a new proposal of some kind is inevitable. IAAPA Europe will continue to monitor developments.