This article tries to explain the exceptional Spanish government measures to protect consumers during the COVID-19 regarding package travel. Updated information to May the 14th 2020.
Travelling impossible due to COVID-19
The new regulations could be against the UE law and therefore void and null. The reason is that they reduce the consumers’ rights already granted trying to protect the tourism agents (organizers and travel agents which have been strongly affected by COVID-19). This is explained deeply in this article in Spanish. I will try to explain the new regulations briefly which are as follows:
If the organizer or travel agent cancel the contract, there are the following options: (i) the consumers gets a coupon for the trip value valid for one year, (ii) only if not used then the consumer can ask for the full money back. This way the consumers are financing organizers and travel agents for one year! Not bad.
In the case that it is the consumer the one who cancels the contract then: (i) the consumer gets a coupon, and (ii) they have the right to the money back but only if the all the operators involved (such as airline companies, hotels, events, etc.) in the travel pays back to the organizer or the travel seller. If those payments back are in full the consumer will get the money back in full. If those payments back are not in full, the consumer will get a partial payment back. The payments received will be deducted from the coupon value. The payments to the consumer can be made up 60 days after the organizer or travel agent has received them from the corresponding operators involved.
In the legal world there are two different views on these exceptional regulations. One is that they are exceptional circumstances and they apply only during them. The second is that they mean a consumers’ rights reduction as the regulations previous to the new ones foresee as a general rule that the consumer get ot all the monies back in 14 days in the case the cancellation was due to an act of God equivalent to the COVID-19 situation. So, the different treatment could be indeed against the UE law.
The best opinion to follow is the number one. And I actually think that the EU understands it the same way and acknowledge the right to the consumer for the full refund in the legal time. Actually, today May the 14th the European Union Official Journal has published a Commission Recommendation with this regards and in this sense.
Take into account that the seller or organizer have no incentive at all to cancel the contract themselves because they will have to pay the monies back to the consumers sooner than if they wait for the consumers to cancel.
From a practical point of view there is no much difference. Even if the new Spanish regulations on cancellation of package travel are against the EU law the only consequence is that the consumer will have to claim the money back as soon as possible and wait until the outcome of either the Consume authorities or even the court. And this could take more than one year. So the only difference is that if the consumer was entitled to get the money back 14 days after cancellation instead of one year after the end of the emergency estate, the seller or organizer will have to pay interest for that year they kept the money with no reason. I am afraid that will be the only consequence. So the regulations are a little bit of a trap. And I would say they are made to protect more the sellers and organizers than the consumers. If the sellers or organizers have a lot of financial trouble if most of the consumers claim the package travel money back at the same time (monies which could and should be insured anyway) the consumers might be as well in financial trouble due to Covid-19 situation. And it is not the consumers’ fault either.
So the recommendation when travelling cancellations are affected due to COVID-19 is to claim all the monies back in 14 days. If the seller disagrees on that calling the new regulations, then you can claim to the consume authorities.
Besides, package travel sellers and organizers must have insured all their liabilities. So, the new regulations protect as well the insurance companies which will not have to pay the many claims that will arise from the COVID-19 situation due to the impossibility to execute the package travel contracts.
Finance of travelling from the travel seller
In the case there is a loan to finance the trip arranged by the organizer or seller, the loan is void and null as well as the trip and you should get all the money back already paid because the trip will not take place. And you can stop the following down payments immediately.
Thank you for your time and attention and I hope this information is of use. You are very welcome to share if you liked it. You might be interested in this other posts on COVID-19: joint custody and visiting rights during COVID-19, consumers’ protection measures during COVID-19 Part 1, and consumers and mortgage, loans and rent during COVID-19.
Please, note that this is general information. This is not specific legal advice. It is advisable to seek legal advice for any specific legal issue.
And remember, take care and stay at home.