The Coronavirus Outbreak – Knowing your legal obligations

The coronavirus outbreak is continuing to have a devastating effect in Eastern Asia, where the death toll is believed (at the time of writing) to have now reached 213.

Originating in Wuhan (in the Hubei Province), the disease is now known to have spread not just throughout Mainland China, but also Australia, Cambodia, Canada, Malaysia, Thailand and the US. Within Europe, confirmed cases have been reported in Germany, France and the UK.

As the virus is so highly contagious, action is being taken by government bodies worldwide to limit it spreading and restrictions are being put in place to prohibit the movement of people either who may be infected, or who are travelling to or from infected areas – Hong Kong authorities have reduced by half the number of flights and shut down rail services to mainland China; Papua New Guinea have suspended their visa on arrival service, instead requiring entrants to acquire visas in advance. Closer to home, British people returning to the UK from Wuhan will be kept in isolation for 14 days and British Airways has cancelled all flights to and from mainland China.

So, what does this all mean to the travel & leisure industry?

These are of course extreme measures, necessary to protect the wider population – but what do they mean for businesses in the travel industry, and what are your legal obligations when it comes to customers with booking that may be affected? Below we address some of the main queries that have been received from businesses within the industry:

I have a group booking scheduled to depart tomorrow on a package holiday to Beijing – they have contacted me saying they do not want to travel, what do I do?

Regulation 12(7) of the Package Travel and Linked Travel Arrangements Regulations 2018 (The 2018 Regs) gives travellers the right to terminate the package travel contract at any time before the start of the package in the event of unavoidable and extraordinary circumstances occurring at the place of destination or its immediate vicinity. Said circumstances must significantly affect either the performance of the package or the carriage of passengers to the destination. The Package Travel Directive clarifies that an unavoidable and extraordinary circumstances includes warfare, terrorism or the outbreak of a serious disease. Undoubtedly, the coronavirus outbreak falls within this remit.

The FCO advice currently advises against all but essential travel to Mainland China, and so it is completely understandable that anyone due to travel there in the immediate future is likely to reconsider.

When a traveller terminates the package in accordance with the above circumstances, they are entitled to a full refund of any payments made to date; they are however not to any additional compensation.

As such, if the group wish to cancel, they are entitled to a full refund of all monies paid.

I have received a call from a customer due to travel to Shanghai on 28th February. They want to cancel in light of the virus outbreak and are demanding a full refund. Do I have to pay out?

The short answer is No.

Current FCO advice advises against all but essential travel to Mainland China however, as we know, FCO advice can change and indeed is likely to change over the coming days and weeks as the situation progresses. It will be important for all those within the industry to keep abreast of the latest FCO updates and monitor the various travel bans currently in place.

Whilst there is no hard and fast rule as to the period within which travellers can cancel their booking and obtain a refund in these circumstances, the general practice that has been adopted within the industry is to use a 21 day rolling calculation.

For example, today on 31st January, the FCO advises against all but essential travel to Mainland China. If I am due to travel to Shanghai on 14th February, my booking falls within the 21 day period and so I can cancel and receive a full refund if I wish.

If, on the other hand, I was due to travel on the 28th February, and I rang up my tour operator saying I wanted to cancel, I could do so, but I would not be entitled to a refund. In that circumstance, I would need to wait until the 7th February, re-check the FCO guidance as at that date and, if it still advised against all but essential travel, I could then terminate my booking and ask for a refund, to which I would then be entitled.

I have customers booked to travel to China in 2 days’ time but they have not contacted me stating that they wish to terminate? Do I have to do anything?

Yes. The obligation is on you to contact the customer without undue delay and advise them that their booking will not be going ahead in light of the current FCO advice. These customers will be entitled to a full refund in accordance with Regulation 13, but will not be entitled to additional compensation.

If the customer is not due to travel until next month, then you can of course wait until closer to the time, whilst continuing to monitor the FCO advice.

I am an Incoming Operator with a group due to arrive in the UK, but the flights are now cancelled

All the same above, basic principles apply but given the Package Travel Directive does not apply to sales outside the EEA, there is an increased prospect of the UK Regulations not applying to such bookings. That will be an important consideration, as will be knowing what the contractual situation is –such terms will be key to review.

I have customers currently on their 5th day of a 14th holiday in Beijing who want to return home. What do I do?

Whilst the FCO is advising against all but essential travel to mainland China, there is no advice regarding those wanting to return back to the UK. In fact, the Foreign Office has made it clear that those who are currently in the People’s Republic need not return early.

As such, if customers wish to return home, they can do so, but at their own cost. They will not be entitled to any form of refund or compensation. Regulation 18 places an obligation upon you to provide assistance to any traveller in difficulty, but again this does not involve you having to pay for anything and rather may just involve you putting them in touch with the Foreign Office or suggesting alternative flight arrangements that they can book at their own cost.

You may wish to advise customers that there is a high probability that they may face some level of attention on their return to the UK, and that they may wish to carefully monitor any symptoms that arise in the coming days and weeks.

 

The situation continues to change and it will be vital to continually monitor the FCO guidance and updated travel alerts as and when they arise.

Should you have any queries specific to your business, or wish to discuss any of the issues in this article further, please do not hesitate to contact Krystene Bousfield