ABTA hits out at CAA’s ‘lack of clarity’ on ATOL reform

By Lisa James
02/04/2023
Home » ABTA hits out at CAA’s ‘lack of clarity’ on ATOL reform

ABTA has submitted its response to the Civil Aviation Authority’s request for information on ATOL reform proposals.

In its response, ABTA accused the CAA of ‘lack of clarity on the rationale for reform’.

“ABTA says the COVID-19 pandemic demonstrates that resilience in the sector is strong and the ATOL scheme stood up well during this time, so questions what the reforms are trying to achieve,” the association said in a press statement.

The main points in ABTA’s submission include a call for the Department for Transport and Depart for Business and Trade to work together with the CAA to ensure consistency between the financial protection arrangements available in respect of flight and non-flight packages.

ABTA also pointed out its members remain very strongly in favour of having a range of financial protection methods, ie bonds, insurance and segregation.

It repeated its view that: “A one-size fits all approach will not work and is not appropriate, and this is a view which is shared by financial services providers.”

Bonding remains a popular form of financial protection and there is large-scale opposition to mandatory segregation of customer monies, according to ABTA.

ABTA also highlighted a lack of clarity about what the CAA is trying to resolve by introducing variable APC [ATOL Protection Contribution] and a concern variable rates could distort the marketplace.

“Members have also raised concerns around the additional complexity that variable APC will introduce into the ATOL scheme,” ABTA said.

“Whilst there is some support for a variable approach to the APC by some members, it is difficult for members to provide constructive feedback on the CAA’s proposal to introduce a variable APC without having any understanding of how the CAA believes this would work in practice.”

Section 75 protection and chargeback rights also need to be taken into account, which reduce the risk faced by the Air Travel Trust Fund, ABTA suggests.

ABTA members and partners can read ABTA’s full response to the CAA here.

Travel Gossip has asked the CAA for a response.

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