Travelling Irresponsibly - The Impact of the Package Travel Regulations

ben on 5th August 2010 | 1 comment |

 

Do you like to travel independently? Maybe you have done a little backpacking or taken time out and enjoyed the pleasure of exploring, discovering local gems and getting off the beaten track. Maybe you try to book locally and pay a fair price (and make sure as much of your money as possible goes to the local economy). So when you need to book ahead and can't rely on sorting it out on the ground, how do you book with a local company and make sure your holiday is protected? It is a tricky subject so bear with us...

The package travel regulations were introduced to protect your pre-payments (i.e deposits) and to provide a reasonable level of safety (i.e. insurance, health and safety). They are well intended, but nowadays they are in a mess.  They apply inconsistently across different categories, mislead and confuse people and create competitive advantage for established players - disadvantaging smaller local operators in the destinations we visit (read more about this in this excellent article by Harold Goodwin)- exactly the kind of businesses independent travellers want to support!

The unfortunate side effects of the package travel regulations is that they encourage the purchase of packages and therefore the continued dominance of the opaque outbound tour operator model. They discourage exploring, rebelling against the crowds and going local. Why? Well effectively, a small community safari lodge in Botswana, or a trekking outfit on the Inca Trail, that sells direct to a UK consumer should comply with the package travel regulations by EU law. Simply put, if they have a website through which a UK customer contacts them and tries to book, then they should have a level of insurance that is often impossible to procure in their countries and a level of financial bonding that is simply unrealistic to expect. You don't have to be a scientist to work out that this encourages bigger international companies and discourages smaller local companies. 

Instead these opaque outbound tour operators blossom. A tour operator by definition takes ownership of the delivery of your holiday, they carry the buck. And in their defense many do this very well, carrying out regular and stringent checks on the transport, accommodation, equipment and overall quality of what is delivered locally. In return they package up the discrete elements of your holiday and place a mark up on it for their services. There is nothing wrong with this in principle, but the unfortunate side effect is you don't know the nature of the local operator you will be using and have to trust your outbound tour operator blindly. For example, if you are trekking the Inca Trail, it doesn't matter which UK tour operator you book with, when you are in Peru,  you will be trekking with a local operator. The problem is that instead of being able to do your research and choose the best provider for you, you have to play an elaborate game of charades with your operator, as they rush to sew their logos onto the shirt's of whichever local guides they are working with. Your only resort is to trust the reputation of the outbound tour operator as you won't know who the actual local operator delivering your trek will be.

This all creates a quasi black market. You want to do your research on Tripadvisor, find the best local operator organising treks on the Inca Trail and book direct with them, you don't want a bloated outbound operator taking half your money to spend on UK headquarters. But when it comes to booking, in many cases you will find yourself having to send large sums of money overseas without any financial protection.

So is a little transparency too much to ask? Would it really be all that awful if we could know the name and reputation of the company who will be looking after us locally when we travel long haul and still be able to book with confidence?

There are clearly challenges. There is no way local operators will be able to comply in full with the package travel regs and sell direct to a UK customer. And of course, there is little incentive for the tour operator, with their oblique pricing mark-ups to disclose the name of the local operator!

Possible solutions could be in finding a way to overcome the bonding issue. Why can't we find a way to capture bookings without pre-payments? Why doesn't the industry abandon bonding and adopt some kind of per passenger supplier failure cover insurance as a de facto standard? After all, you will certainly pay an equivalent hidden cost anyway when you book with a bonded operator? Regardless, don't hold your breath!

For our part, we are taking a number of steps to help you find and book great local operators at local prices. It is a tricky task to balance, as the danger is, we introduce too much cost and divert money from the local operators. So what do we do? 

1. We do the research to find the best local operators, ensuring as far as possible (without becoming a tour operator!) that they are reliable and safe, 
2. We also happily disclose who they are and why we work with them before you book. 
3. We also provide supplier failure cover, taking any hassle and fear away from the purchase. Effectively you are covered should the operator (or heaven forbid ourselves) go out of business. 

We aren't resting there either, we are exploring options to provide full bonding (in addition to supplier failure cover) and better ways to expose the quality and credentials of our local operators. But until the industry as a whole gets its act together it will continue to be an unfair playing field that discourages true responsible travel.

Comments (1)

1. Please long out my company username and password for new account via my email ID, Thanks, Basnet

   Parikrama Treks and Expeditions 13th January 2012

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