On 4 April 2017, Nikki Spoor, head of audit and compliance at WHA posted this blog entry for the ICAEW Travel & Hospitality Group .
On 25 November 2015 the New Package Travel Directive (PTR) (2015/2302/EU) was adopted, bringing it up to date with developments in the very dynamic outbound travel market. The New Directive entered into force on 31 December 2015 and EU Member States have to transpose it by 01/01/2018 and it will be applicable from 01/07/2018. The old PTR had become outdated by the onset of new technology and customer preferences. If you are a registered ATOL Reporting Accountant it is important to understand the implications of the changes, to ensure you understand the new definition of a package and the newly introduced definition of a Linked Travel Arrangement (LTA). The new PTR beings most online sales of holidays within the definition of a package and creates a new category of LTA to cover click through sales between linked websites. BREXIT may well mean that within months of being applicable the PTR may require further reform.
Firstly we need to look at what the 1992 definition of a ‘package’ is currently. This is the pre-arranged combination of at least two of the following components when sold or offered for sale at an inclusive price and when the service covers a period of more than 24 hours or includes an overnight accommodation : a) accommodation, b) transportation, c) other tourist services not ancillary to transport or accommodation and accounting for a significant portion of the package.
The new definition of ‘package’ is the combination of at least two different types of travel services for the purposes of the same trip or holiday if ; a) those services are put together by one trader, including at the request or according to the selection of the traveller, before a contract on all the services is concluded ; (b) Irrespective of whether separate contracts are concluded with individual travel service providers, those services are :
i) Purchased from a single point of sale within the same booking process and selected by the traveller before payment ; or
ii) Offered or charged at a total or inclusive price ; or
iii) Advertised or sold under the term ‘package’ or under a similar term ; or
iv) Combined after the conclusion of a contract by which a trader entitles the traveller to choose among a selection of different types of travel services ; or
v) Purchase from separate traders through linked online booking processes where the traveller’s name and other date (card details, contact details, passport details) particulars needed to conclude the booking of the first service is confirmed.
A Travel Service under the new PTR means : a) carriage of passengers, b) accommodation other than for residential purposes, c) car rental or other modes of transport, d) any other tourist service not ancillary to the other 3 services.
The difference between an LTA and the new package definition is that it captures multiple bookings for multiple contracts rather than the shopping basket model of a single booking with multiple contracts.
As always the devil is in the detail and I will cover in my next blog on the subject what the New Directive doesn’t apply to and other applicable detail.