The Competition and Markets Authority has warned travel companies to stop mistreating unfortunate customers who have to cancel their holidays due to unforeseen circumstances.

A lack of awareness over how much can be retained when a traveller cancels a booking is widespread, according to the Competition and Markets Authority. A company cannot automatically keep a large deposit if the customer cancels owing to unforeseen circumstances. Such a contract may be unfair, even if written into terms and conditions.

This means that if a holidaymaker has to cancel a booking due to illness or a family tragedy, and the travel company has had enough time to re-sell the booking, then the travel company should refund the payment or deposit in full. Any amount it charges should reflect the cost it incurred to re-advertise or re-book that particular cancellation.

If the company includes a blanket non-refundable deposit demand or cancellation fee in its terms and conditions then this could mean the contract is unfair and therefore, not legally binding. Even if the customer has signed the terms and conditions, the contract would be unenforceable.

Paul Latham, from the UK’s competition watchdog, said that as many as 50% of travel firms may not be fully aware of the rules. Many smaller firms may copy terms and conditions from others, potentially leading to a proliferation of unfair contracts. The watchdog has no plans to launch an investigation into specific operators, but is working with travel trade bodies to raise awareness of the rules through its “small print, big difference” campaign. The CMA wants customers to know that they do not always have to resort to travel insurance to retrieve deposits if they are forced to change their plans.

Protect Yourself From Holiday Fraud

Every year, holidaymakers pay thousands of pounds for flights and accommodation only for some to end up with non-existent journeys because fraudulent scammers pocket the cash, according to the Association of British Travel Agents (ABTA). In other cases, agents are simply incompetent, so holidaymakers end up with sub-standard trips.

Before you book any trip or holiday, make sure your agent is ABTA licenced. This will protect you if the company goes bust or you have a negative experience. And if you are a victim of fraud, you should report it to your local Trading Standards.

  1. Check for ATOL protection: Look for the ATOL logo on your travel company’s website, brochure or shop front.
  2. Research your trip: Some companies will incorrectly claim to have ATOL protection. Check the company’s name on the online database at:
  3. Check if your package includes a visa: Appoint a licensed travel agent and ensure that they are arranging a visa as part of your arrangements if you need one.
  4. Watch out for hidden costs: Make sure you check the airport and accommodation fees, such as baggage allowance and accommodation transfers, to avoid any surprises.
  5. Check financial protection if booking with non-UK travel companies: There are some non-UK travel companies which offer travel to UK consumers, but these will often not be ATOL protected. Do your research and check what financial protection they provide.
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