The European Parliament has definitively approved the update of the package travel directive, the legislation governing “all-inclusive” travel in the European Union. The reform introduces clearer rules on what constitutes a package, strengthens travellers’ right to reimbursement, limits the use of vouchers and establishes precise timeframes for handling complaints and refunds.
“These updated rules will protect consumers when something goes wrong with their travel package,” claimed the rapporteur of the text for the House, the Maltese socialist Alex Agius Saliba. “This is an important step to strengthen trust in the organized tourism market and ensure a more solid balance between consumer protection and sustainability of the sector,” added the shadow rapporteur, Denis Nesci of Fratelli d’Italia.
The old legislation
European package travel legislation was modernized in 2015 to adapt to the growth of online bookings and personalized combinations of travel services. That reform also introduced the category of “linked tourist services”, designed to cover combinations of services booked separately but with a certain connection between them. In practice, that category has created more problems than solutions.
In the following years, the practical application of the directive showed some limitations. The Covid-19 pandemic, with the simultaneous cancellation of millions of trips, has highlighted in particular the absence of clear rules on vouchers, refunds and relationships between tour operators and tourism service providers. Added to this was the failure of high-profile operators, such as Thomas Cook in 2019, which left hundreds of thousands of tourists without effective protections.
What a “Package” Really Is
One of the most relevant issues for consumers is understanding when their booking is actually “protected” as a package. The distinction is not trivial: only those who purchase a package enjoy the protections provided by the directive, including the right to reimbursement in the event of bankruptcy of the organizer and free cancellation in extraordinary circumstances.
The legislation, which received 537 votes in favour, 24 abstentions and only 2 against, establishes that a package is the combination of at least two services for the same trip or holiday, for example flight and hotel, or hotel and excursions, sold together or connected to each other.
The updated directive clarifies that a package also exists when different services are purchased via connected online booking systems. In particular, if the first operator transmits the customer’s personal data to a second operator and the contract for the second service is concluded within 24 hours of the first booking, the entire combination is considered a tourist package.
The logic is simple: when services are closely linked and organized as a single travel experience, the consumer must benefit from the same protections provided for traditional packages.
Adding services
Another novelty concerns cases in which a professional invites the client to add services, without the combination meeting the requirements to be a package. In these cases the operator is obliged to explicitly inform the traveler that the additional services will not be covered by the protections of the directive. If he does not do so, and the customer books the additional service within 24 hours at the same point of sale, the entire combination automatically becomes a package, with the operator taking on the responsibility of organizer.
Vouchers only if the traveler accepts them
There will also be changes to the use of vouchers, which became widespread during the pandemic when airlines and tour operators offered vouchers instead of refunds.
The new rules establish that vouchers can be offered by the organizer but must be explicitly accepted by the traveller. The customer always retains the right to refuse them and request a cash refund within 14 days.
The voucher must have a value at least equal to the refund due, be valid for a maximum of 12 months and can also be used partially to purchase other travel services. If it is not used completely upon expiry, the remaining amount must be returned to the traveler within 14 days, without the need for any request on his part.
Cancellations without penalties in most cases
The new rules also clarify when a traveler can cancel the package without paying penalties.
In addition to unavoidable and extraordinary circumstances in the travel destination, the right to free cancellation is also extended to serious events that occur in the place of departure or that directly affect the trip, for example armed conflicts (think of the trips to the Middle East that were canceled after the US and Israeli attack on Iran), serious health risks or natural disasters.
The assessment must be carried out on a case-by-case basis, considering whether such circumstances could have “a substantial impact on the execution of the tourist package contract”. In practice, if a situation makes the trip dangerous or impossible in a reasonably foreseeable way, the customer can withdraw without paying additional costs and obtain a full refund.
Certain times for complaints and refunds
The directive also introduces precise deadlines to improve the management of disputes between travelers and organisers.
When receiving a complaint, the organizer must confirm receipt within seven days and provide a reasoned response within 60 days. In case of trip cancellation, the refund must be made within 14 days of termination of the contract, without the customer having to submit a formal request.
Bankruptcy protection
When a tour operator goes bankrupt, the money already paid by customers risks being lost. To avoid this, European law obliges organizers to provide themselves with a financial guarantee, for example an insurance policy or a guarantee fund, which covers reimbursements due to travelers and, if the return trip was included in the package, repatriation costs.
The new rules make this obligation more stringent. The guarantee must be sufficient not only in the abstract, but at all times of the year, including the months in which operators collect payments in advance of sailings, typically spring and early summer. Member States must ensure that coverage is effectively adequate and can impose additional mechanisms, such as reserve funds, in cases where insurance policies are not sufficient.
