Section 75 consumer credit act

corsa57

It would seem that Section 75 Chargeback may not be as usefull at reclaiming your money if the airline goes bust.
I have booked flights and accomodation through a online Travel Agent. They act as ticket agents for the no frills airline which is not ATOL bonded. I paid the travel agent using a credit card. I thought in these circumstances I would be eligible for Cashback under section 75 if the airline went bust.
I now understand that as I paid the online Travel Agent and not the airline direct I would get nothing back if the airline went bust.
The argument the credit card company will use is that the company paid by then on my behalf (the Travel Agent) has not gone bust just the airline.
This is a nonsense in my opinion and the law must be changed to stop credit card companies circumventing the law.

budgetflyer

surely they have then sold you a "package" and will be able to refund you via their own ABTA or ATOL bonding

corsa57

In ABTA, ATOL speak what I booked is not considered a package holiday.
The online Travel Agent is ABTA bonded but cover does not apply as it is not a package. They are not ATOL bonded. Interestingly the airline holds numerous ATOL bonds but not for the no frills part of the empire.
I have now taken out Supplier Failuer Cover Insurance which I hope and trust will cover me in the event that the airline or indeed any other third party supplier to my holiday goes bankrupt.

moonrakerz

corsa57 wrote: »

This is a nonsense in my opinion and the law must be changed to stop credit card companies circumventing the law.

The credit card companies are not "circumventing" the Law - they are complying with it. !

Read this, it may be of help.

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/31/creditcards-31.htm

jonesMUFCforever

Does OP not have a case against the travel agent then?

corsa57

Thank you Monrakerz this information makes the situation much clearer.

You are quite clearly not covered under section 75 if the airline goes bust if you don't book direct with the airline.

I feel that the statements being issued on section 75 by so called experts are contributing to the myth that you are covered as long as you pay by credit card.

moonrakerz

corsa57 wrote: »

I feel that the statements being issued on section 75 by so called experts are contributing to the myth that you are covered as long as you pay by credit card.

Spot on ! That is why I keep referring people to sites like the ombudsman's.

corsa57

I wonder if Moonrakerz could confirm ( given the circumstances I have previously explained) whether I would have a claim on the Credit Card company under Breach of Contract.

moonrakerz

corsa57 wrote: »

I wonder if Moonrakerz could confirm ( given the circumstances I have previously explained) whether I would have a claim on the Credit Card company under Breach of Contract.

I think the answer has to be:- it depends ! To quote the Financial Ombudsman:
"Where customers use a credit card to buy airline or other travel tickets from a travel agent, they cannot normally claim against the travel agent if the airline delays or cancels the flight. This is because the travel agent contracted to supply the ticket, not the flight. So the customer would not have a claim under section 75 either.

However, things are different if customers use a credit card to buy the travel agent’s own ‘package’ of travel arrangements. In such instances the agent is the supplier of the holiday package. "

I will agree that the difference between these two can be the thickness of a hair - but that is how the Law stands.

Was the Travel Agent a member of ABTA ?

Altarf

corsa57 wrote: »

I have booked flights and accomodation through a online Travel Agent. They act as ticket agents for the no frills airline which is not ATOL bonded. I paid the travel agent using a credit card.

From reading the Financial Ombudsman page it would appear that you have contracted with the Travel Agent to provide the tickets and not the flights. If the airline has gone bust before you got your tickets, then Travel Agent has breached their contract and section 75 does kick in.

However if they have already provided the tickets and the airline has now gone bust, then tough luck.

It seems the moral of the story is, always use a credit card, but if you are just buying a flight never use a travel or ticket agent.

corsa57

moonrakerz wrote: »

I think the answer has to be:- it depends ! To quote the Financial Ombudsman:
"Where customers use a credit card to buy airline or other travel tickets from a travel agent, they cannot normally claim against the travel agent if the airline delays or cancels the flight. This is because the travel agent contracted to supply the ticket, not the flight. So the customer would not have a claim under section 75 either.

However, things are different if customers use a credit card to buy the travel agent’s own ‘package’ of travel arrangements. In such instances the agent is the supplier of the holiday package. "

I will agree that the difference between these two can be the thickness of a hair - but that is how the Law stands.

Was the Travel Agent a member of ABTA ?

The Travel Agent is indeed a member of ABTA.