- Paul Evans operation bonded for just €79,243
- €3.8m claimed by 4,200 Irish customers
- Draw wil be on Travellers’ Protection Fund
The collapse of Lowcostholidays, which was bonded for just €79,243, has resulted in claims totalling €3.8m by 4,200 Irish customers.
The claims were made to the Commission for Aviation Regulation following the collapse of Lowcostholidays in July 2016. Refunds of tickets and accommodation booked through Lowcostholidays are being paid if the original departure point was in Ireland. Expenses can be claimed by customers who were already abroad at the time of the collapse.
For the first time in the event of a tour operator failure for many years, refunds wil be paid from the Travellers’ Protection Fund, which is administered by the commission, to meet any shortfalls for customer losses in the event of a firm’s collapse. Compensation wil eat up 75pc of the protection fund.
Accounts filed by the commission show it had just over €5m in the Travellers’ Protection Fund at end of 2015. Contributions to the fund were suspended in April 1987 due to cash reserve targets being reached.
The Transport (Tour Operators and Travel Agents Act) Act 1982 requires tour operators and travel agents to have a bond for the protection of its customers in place before they can be granted a licence.
Irish Travel Agents Association President Cormac Meehan called on the government to review the legislation around bonding among travel providers in Ireland. “The Lowcostholidays refunds will clear out 75% of the Travellers’ Protection Fund. We are calling on the Minister for Transport, Tourism and Sport to meet with the ITAA immediately to review the legislation around bonding and work on the next steps, Lowcostholidays.ie (lowcostholidays Spain S.L.) was licensed and bonded by CAR so we are amazed at the underprovision in the context of the thoroughness with which the Regulator usually deals with our members. The ITAA have been pushing for a collective bond for years, among all travel agents, tour operators and airlines. We would also like to draw the Minister’s attention to the organisations, within the Irish travel sector, that are not bonded with CAR at all. This area must be reviewed immediately to ensure the protection of Irish consumers. If travel agents and operators continue to be underbonded, the shortfall will ultimately be paid by the taxpayer.”
