On the Beach.

sun-n-moon

A few months ago my Daughter booked a holiday [against my advice} to Majorca for her husband, herself and two year old for the 7th October this year through "On the Beach" travel agency. This included flights with Ryanair and an All Inclusive hotel.  The hotel has subsequently informed her and the agency that they are closing down and there will be no accommodation available. The Agency say they will refund the hotel and transfer costs but will not refund the flights as the flight has not been cancelled and the airline has not refunded the flight costs to them. The choice is therefore to land in Palma with no accommodation with a toddler in tow or cancel and lose the flight cost. Some £300+.  As far as I am aware their contract is with the agent and that contract has been broken as the accommodation has been removed, so they are entitled to a full refund. Unfortunately the payment was made with a Natwest debit card so no recourse to Visa etc. Evidently there are very few hotels available due to the current virus situation.
Any advice or constructive comments would be appreciated.
Thankyou.

bagand96

The contract thing is a little complex. They have a contract with OTB to act as their agent. However they also have separate contracts with the service providers - Ryanair for the flights, and the hotel (or more likely an intermediary) for the accommodation. This is all made clear at the beginning of the OTB T&Cs.

That said, if the flights and hotel were booked together at the same time, it is considered a package, and you have rights under the Package and Linked Travel Regulations 2018.  That’s a good thing, because under those regs OTB can’t just refund for part of the holiday. If they are cancelling it, they owe a full refund.

Remind OTB of their obligations under the PALTR 2018. If they’re struggling, point them to the package rights listed on their own website https://www.onthebeach.co.uk/package-rights

Finally you do have some recourse with a debit card. Look up chargebacks. 

Westin

Good advice above.

OTB are being purposefully obstructive if your daughter booked a package holiday with them (albeit a cobbled together one).  They have an obligation to find another hotel of the same or of a higher standard if the original one is no longer available - or, a full refund offered.

As bagand96 mentioned, you may have to remind them of their obligations under the Package Travel Regulations 2018.  If your payment card is unable to help you may have to look at legal action to recover the money if they are still not giving way.

For the future, best to avoid these ‘cheaper’ online firms who cobble these holidays together. It gets extremely messy when things go wrong.

sun-n-moon

Many thanks for the advice. I will put something together to advise them of their responsibilities. They do not answer the phone or emais,,l at the moment. A little googling throws up articles in the Telegraph and Independent that they have a history of doing this where other companies have offered complete refunds. They are using the excuse that they have paid Ryanair so as they have not been refunded for the flights  they cannot refund their client. I see it as, not their clients problem.

bagand96

sun-n-moon said:

Many thanks for the advice. I will put something together to advise them of their responsibilities. They do not answer the phone or emais,,l at the moment. A little googling throws up articles in the Telegraph and Independent that they have a history of doing this where other companies have offered complete refunds. They are using the excuse that they have paid Ryanair so as they have not been refunded for the flights  they cannot refund their client. I see it as, not their clients problem.

It's how it works with these agents that, as Westin says, "cobble together" a package.  They just take a flight, throw a hotel with it and it's a package.  It's not the same as the proper tour operators like Jet2Holidays or TUI.  

Years back, when these OTA's first gained market share, it would be no better than DIYing a holiday.  They literally were just your agent and your contract was with the end suppliers (airline, hotel etc).  When things went wrong, they'd say "not our problem, we're just the agent".   The Package and Linked Travel Arrangements Regulations 2018 changed that and put into law that when you book elements together, it is deemed a package, and therefore you have rights.

It's great in theory, but as we are seeing can be difficult in practice.  Many OTA's don't want to, or more likely cannot, step up to their obligations under the PALTR 2018.  The problem with the business model is, they are on the hook for non-refundable flights.  They won't get the cash back from Ryanair (or other airlines), so they have to fund it themselves.  In "normal" times, where you'd have a few cancellations, or issues with certain resorts/countries, this is probably an acceptable business risk.  In Covid times, with the complete closedown of leisure travel, it is an unsustainable fiasco.

I'm not defending OTAs.  But the situation is a mess, and quite likely many of them face financial ruin once customers start enforcing their legal rights. 

NoodleDoodleMan

Do such "cobbled together" bookings actually consitute a recognised package holiday ?

https://www.abta.com/help-and-complaints/frequently-asked-questions/what-package-holiday

We booked a return flight to the Canaries for later this month, plus two separate hotels over 7 nights all from TUI - we couldn't get an off the shelf complete package deal of flights+hotel+transfers to suit our requirement.

When it started to look as if the flights were not going to take place I called TUI and they advised me it wasn't a recognised proper package as the main elements were separate reservations.

This opinion was confirmed by calls to two other TUI retail stores.

In the final analysis it didn't matter in practice as they refunded in full when the flight was cancelled.

I'm going to investigate further and get an opinion from ABTA in due course - I'm still unclear either way.

sun-n-moon

This from The Editor of Which magazine-.
'Anyone who has their hotel cancelled as part of a package holiday is due a refund for the full cost of the holiday under the Package Travel Regulations, but holidaymakers who decide not to travel because of government advice might struggle to get their money back. 
I note they have ditched their ABTA membership.

NoodleDoodleMan

OTB have received very negative media reviews in recent weeks over their cynical decision to abandon ABTA.

As one respected travel journalist observed - they were members when refunds needed actioning, so they have no justification for retrospectively bodyswerving their responsibilities.

They have probably shot themselves in the foot for ongoing long term viability - can't see many repeat customers in future.

sun-n-moon

This, under their own terms and conditions, on their website.
Travellers may terminate the contract without paying any termination fee and get a full refund of any payments if any of the essential elements of the package, other than the price, are changed significantly.  I think  the hotel is an essential part of the package. I'm sure a court will agree.

bagand96

NoodleDoodleMan said:

Do such "cobbled together" bookings actually consitute a recognised package holiday ?

The phrase the industry use is "Multi-contract package". That's where you have a package booked at the same time, but your contracts for each service are separate (including a contract with the agent itself). 

lea2012

Why would they choose to arrive and have no accommodation? 
Are they still wanting to fly? If so OTB could find them alternative accommodation.