CAA seeks more input on ATOL reform and sets start date for new system

ATOL reform
By Lisa James
24/01/2023
Home » CAA seeks more input on ATOL reform and sets start date for new system

The Civil Aviation Authority says a new system to replace the current ATOL protection scheme will be in place by April 2024 – but before that, it is asking for more information to help shape the final scheme.

The April 2024 date will be three years since consultation on ATOL reform started and the CAA acknowledges travel companies will need time to adjust to the changes.

CAA Head of ATOL Michael Budge said: “We recognise that 1 April 2024 is a start date and there will be a transition period.”

He said the CAA ‘deliberately’ hasn’t set out how long the transition period will be, adding: “There will be further engagement and response.

“We want the industry to engage meaningfully and we’re providing them with another opportunity to comment, based on more detail.”

In a new document published today, the CAA provides further detail on how it envisages the options of reform could work in practice, recognising that businesses within the sector have different structures and different ways of operating.

The CAA says it sees segregation of funds as the favourable option, although there is likely to be a hybrid model with a combination of segregation of customers’ funds and bonds.

The CAA is now seeking further information from travel companies on how its proposals could be implemented and ‘more targeted information as to how this could work in practice’, Michael said.

“We think that segregation is a more favourable route to take – we are not closing the door to the bonding,” he said, adding: “We recognise that there are diverse businesses within the sector.”

CAA Consumer Director Paul Smith said: “We want to get this right and this provides industry with further opportunity to comment on the direction of travel of the reform programme and to assist us in the finalisation of our proposals.

“As we proceed, we will take full account of any changes and allow time for the industry to adjust accordingly.”

The trade has two months to respond to the latest proposals, with the closing date set at 24 March.

For more information, and to respond, click here.

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