'Chaos' over holiday guarantees

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The Independent Online
GOVERNMENT plans to guarantee financial protection for holidaymakers, due to come into force today, appear to be in complete chaos, writes Frank Barrett.

In line with a European Community directive on package travel, ratified by Parliament, all holiday companies offering packaged travel are required by law to have arranged some sort of financial protection to repay clients in case of bankruptcy.

However, the Department of Trade and Industry, which is responsible for the legislation, admitted yesterday that holiday companies had been finding it difficult to arrange bonds.

'We recognise there have been problems but any company now trading without a bond is committing an offence,' the DTI said.

Last night there was speculation that the Civil Aviation Authority, which is responsible for bonding air inclusive packages, might not renew licences for several large operators unable to meet its deadline.