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Background of Holiday Laws

Holiday Law is the brainchild of the European countries and evolved in the late 1970s. As the time for jolly Christmas was at the threshold, Mr. Jarvis, in 1969, sat alone in the Bar of the Hotel Krone in Morlialp eating his dry nutcakes, enduring the yodelling of the local man in his working clothes and contemplating the lack of the promised gemutlich.

When we further dwell upon the issue of Holiday Laws the famous cases nay causé célèbres, of Jarvis v. Swans Tours (1973) and Jackson v. Horizon Holidays (1975) come to the fore as they initiated the opening of the flood gates for the litigation and development of this specific Law, popularly supposed to be out of touch with everyday life. These 2 cases have grappled with the complex legal issues, which arise out of the package holiday.Now some two decades later with the enactment of Package Travel Regulations (1992), this branch of the Law came of age.


With a large-scale booming industry which is spreading sporadically across the globe, it has become the so called ‘next crown jewel’ of business industry. But on the other side of the coin by the virtue of being a multibillion-dollar industry it attracts various legal activism and loopholes as well. With the evolution of tours and travel industry, the modus operandi of it also advanced in the form of tour packages inclusive of air travel, accommodation charges. These lucrative offers are prima-facie hard to refuse offers. But the intricacies of such contracts become the legal proposition in the future.

The reason why the inclusive tour in general and the air inclusive tour in particular have reached such a position of pre-eminence are complex, but they can be attributed to several factors. First of them to be listed here is attributed to the idea of “typical” British holiday abroad-sea, sun and sand are most readily available only at those destinations which are easily accessible either by ships or by air. Secondly with technological advancement in the design of aeroplanes their capacity increased, and now they became competent to carry a large number of population. Thirdly the regulations for currency regulation and passport facilities was also liberated to certain extents. Fourthly, the familiarity with the name of the companies was very fascinating such as Thomson, Airtours and Cosmos. They appeal to the customer and give them a promising and reassuring impression of quality time and utmost comfort. In doing so they have acquired the trust and confidence of the public upon which their growth and success has been based.

With the ever-reaching effects of globalization the scope of this article is not limited to any particular country but it highlights several laws which are present from the inception, especially laws and regulations from U.K. and U.S.A.

To begin with the field of holiday package laws there are certain integral terms which needs to be defined and differentiated in crystal clear terms. There are number of synonymous words or phrases which resemble to each other, one such difference is between Package Travel and Linked Travel Arrangements.

Packages, such as ready-made holidays from a tour operator as well as now also customized selection of components by the traveler bought from a single online or offline point of sale. To create a package at least two of the following three components must be present: transport; accommodation; or other tourist service accounting for a significant proportion of the package.

Linked Travel Arrangements, for instance, when the traveler purchases travel services at one point of sale, but through separate booking processes, or, after having booked one travel service on one website, is invited to book another service on a different website, provided that the second booking is made within 24 hours. But invoicing separately for the individual elements does not, by itself, unmake a package if the other criteria are in place.

Under existing travel regulations, around half of UK holiday travel arrangements - 20 million packages and 3 million flight-plus holidays, are financially protected. Such legislation protect the interest of consumers if the organizer or the retailer becomes insolvent, your payment for your package holiday will be refunded through ATOL protection.


There is a primary legal relationship which exists between the tour operator and the consumer which is supplemented by the chain of other subjugated contracts and relationship behind the main contract. These smaller contracts generally bedevil the relation between tour operator and consumer.

In such contracts the eccentric position of tour operator is not as simple as it seems to be, the consumer also has the contract with the suppliers of the elements that runs behind the curtain to make up the package – such as the hotelkeepers, the airlines and the transfer companies and ground operators. These “suppliers” are no other than the sub-contracts as compared to other industries. Such hidden suppliers portray the deceiving image of convenience but they are a complex legal jargon in reality.

This creates a two-way situation in which on one hand it gives the passage of reasonable excuse to the tour operator to reduce his liability on the grounds that defects in the package were not his fault but the fault of an independent contractor(as discussed in the case of Wall v. Silver Wing Surface Arrangements, 1981). On the other hand, it has created a barrier to the consumer effectively suing the “supplier” in his own right.

If the only contract that the consumer has is with the tour operator them to bring an action against a supplier, say for instance a serious quality defect at the hotel room or even for personal injury, will mean bringing an action in tort rather than in contract law.

But the disadvantages of the tour package contracts are not the one-way. It is certainly the case that as the lot of the consumer has been improved by the Travel Package Regulations. There are numerous situations in which the tour operator becomes the “monkey-in-the-middle” who is torn in between the interests of consumer, with strong, legally protected rights, and the commercially stronger suppliers on the other hand (such as airlines, big hotels) which impose straight-forward terms on them that leave them having to foot the bill when things go wrong.

Therefore, after analyzing the situation from both point of views it is clear that such package contracts are complex and there is a blame game of transfer of liability from one party to another, be it tour operator or the supplier in the background.

Recent developments

The need to update our laws is being felt as soon as the material changes have been introduced to the industry. As per the most recent EU rules extend protection the changes to the Package Travel Regulations will see more travel arrangements becoming packages from 1 July, meaning these types holidays will benefit from both financial and legal protection.

The enactment of Package Travel Directive from July 1, 2018 is the latest development in this field. From 1 July, buyers of such holidays will enjoy the same cover as a package holidaymaker, with the vendor obliged to sort out any problems that arise.These new rules mean that internet explorers can book their holidays online, secure in the knowledge they will be compensated in the same way as someone who booked their holidays through a travel agent if something does go wrong.

But the new rules also create a separate category, the “Linked Travel Arrangement”, where the customer buys elements at the same time but selects and pays for each service separately. Consumer protection is much weaker, with no obligation to deliver the holiday as booked. There is concern that some online travel agents will simply move to this model in order to avoid the higher compliance costs the new rules involve.

It aims to introduce a high, uniform level of consumer protection in relation to contracts for travel packages and linked travel arrangements, taking into account the increasing use of internet booking.

Contents Of The New Directive

§ Clear information for travelers: Businesses must inform travelers whether they are offered a package or linked travel arrangement, and on their key rights through standardized information forms. They must provide clear information on the features and characteristics of the package, its price and any additional charges.

§ Money-back and repatriation in case of bankruptcy: Organizers of packages must take out insolvency protection. This guarantee covers refunds and repatriation in case organizers go bankrupt. This guarantee applies also to linked travel arrangements.

§ Clear rules on liability: The organizer of the package, is liable if something goes wrong, no matter who performs the travel services.

§ Strong cancellation rights: With the new rules, travelers may cancel their package holiday for any reason by paying a reasonable fee. They may cancel their holiday, free of charge should their destination become dangerous for example because of war or natural disasters, or if the package price is raised over 8% of the original price.

§ Accommodation if the return journey cannot be carried out: Where travelers cannot return from their package holidays, for instance in the case of natural disasters, travelers are granted accommodation for up to three nights if they cannot return from their holiday on time. Additional nights are covered in line with the relevant passenger rights regulations.

§ Assistance to travelers: The package organizer must also provide assistance to travelers in difficulty, in particular, by providing information on health services and consular assistance.


The following information should be provided by the organizer or retailer before a contract is signed:

· itinerary with dates and number of nights included;

· transport provided, including the times of departure and return, stops and connections;

· accommodation details;

· meal plan;

· visits or other services to be included;

· where group travel is involved, approximate size of the group;

· the language of tourist services where appropriate;

· suitability of the trip for persons with reduced mobility and, on the traveler's request, the suitability of the trip or holiday taking into account the traveler's needs;

· contact details;

· the total price inclusive of taxes and any additional costs;

· arrangements for payment;

· the minimum number of persons required for the package to take place and the time limit for possible cancellation for this reason;

· passport and visa requirements, as well as information on health formalities;

· the traveler may terminate the contract at any time before the start of the package in return for payment of an appropriate fee, or standardized termination fees requested by the organizer;

· optional or compulsory insurance to cover a termination of the contract by the traveler or the cost of assistance in the event of accident, illness or death.

The contract confirmation will also include the following:

· special requirements of the traveler which the organizer has accepted;

· information that the organizer is responsible for the proper performance of all travel services included in the contract, and that the organizer is obliged to provide assistance if the traveler is in difficulty;

· contact details of the insolvency protection organisation, and of the organizer's local representative or of a contact point or any other service which enables the traveler to contact the organizer quickly and efficiently;

· information that the traveler is required to communicate any lack of conformity;

· for unaccompanied children, information enabling direct contact with the child or the person responsible for the child, where the child is staying;

· information on complaint-handling procedures;

· the traveler’s right to transfer the contract.

· In good time before the start of the package, the organizer will provide the necessary receipts, vouchers and tickets and the necessary travel information.

Price increases

Price increases (limited to 8 % in most cases) are only allowed if the contract expressly reserves that possibility (in which case price reductions can also be claimed) and if they directly result from:

· cost of fuel or other power sources;

· third-party tax or fee increases;

· exchange rates.

Any price increase should be notified at least 20 days before the start of the package.


The holiday packages might appear simple, efficient, and convenient and because of these virtues they gain the trust and confidence of the consumers. But on a closer look it becomes clear that the complex nature of Holiday Laws requires a critical understanding of the legal knowledge and business environment of the said field to protect and insure the rights of consumer from getting distorted in the billion-dollar industry.

Author: Navin Kumar Jaggi


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