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Luzi Matzig in TravelAsia
TravelAsia, May 23, 1997
Could this be the year that Asian travel suppliers find ways on
how best to face up to the EC Directive?
Since Luzi Matzig of Diethelm
Travel Thailand raised a call for action on the Directive at the
ASEAN Tourism Forum in January, there has been a good build-up
and no let-up on the issue.
The latest? PATA Asia Division members meeting in Malacca in June
will study whether a sample contract limiting their liabilities
in cases of compensation can be drawn up.
To help them do that, UK lawyer Tim Robinson of Nicholson Graham
& Jones will be brought in for the meeting and, if all goes
well, members will engage him to produce such a contract for a
fee.
Where only a year ago Asian travel suppliers gave the Directive
a little more than passing interest, their mood at present is
an about-turn. A presentation on the Directive during the recent
PATA Annual Conference in Beijing ended with Penang tourism chief
Dato Kee Phaik Cheen immediately offering to host a "small
think-tank" in Penang in July on consumer protection laws.
Dato Kee says the think-tank must bring together "people
who are experienced in legislation from Japan, the UK, the US
and must include government representatives because legislation
is needed to tackle such matters".
In the run-up to the PATA Asia Division Malacca meeting, travel
trade members in Indonesia met last week to discuss the impact
of the EC Directive and what they wish to see done.
Asian travel suppliers, evidently, are feeling the brunt as compensation
claims start coming in from EC Directive-savvy European consumers.
At the upcoming Malacca meeting, Diethelm's Matzig hopes to see
more than just more discussions.
"I really hope that a sample contract can be drawn for use
by Asia members. The contract should limit our liabilities in
cases of compensation and bring in insurance coverage for compensation
claims," he says.
At present, there is apparently no real legal contract between
a supplier and an overseas tour operator. Deals are done on a
letter of agreement, or worse, literal word-of-mouth. After all,
it is an industry which is relationship-based.
It is also because of the need to protect relationships that Asian
travel suppliers are forking out money for compensation, even
though nowhere in the EC Directive does it say they are liable
for consumer compen-sation. The bigger the overseas tour operator,
the fiercer the need to protect that relationship.
Asian travel suppliers appear to be seeking a solution that does
not put them on the losing end of the Directive, yet at the same
time protect their relationship and business with their partners.
Matzig thinks more legally-binding contracts can be an answer.
"With the EC Directive, there needs to be something more
formal, something that is really up to the standard. Preferably,
a legal contract that is valid not just for Europe but Japan,
the US, etc. And it should cover all angles," says Matzig.
"With mere letters, you can end up signing your life away."
But how realistic is it to shape such a contract? Will the overseas
tour operators agree to do business on a contract that spells
out limited liabilities for their Asian partners?
Robinson agrees it is "premature" to discuss contracts.
"Things are still in the formative stages, but I'm happy
and honoured to have been asked to discuss the EC Directive with
Asian suppliers," he says.
Robinson says Asian suppliers are right in their concern over
the Directive: His firm has seen "a big jump" in claims.
"We handled some 250 claims in the last holiday season, compared
with 200 previously. A lot of the cases had to do with Asia,"
he says.
"Some of the claims are frivolous claims but there will always
be legitimate ones too," he adds.
In his presentation to the Industry Council during the PATA conference,
Robinson outlined what he thought could be done at this stage.
Said he, "On a practical level, key words would be information,
education, quality controls and insurance. In each of these areas,
I believe PATA has a policy forming, coordinating and bench-marking
role to play.
"PATA region suppliers and NTOs need to assert and protect
their own positions. By placing operators in possession of accurate
information about the product, what can and can't be delivered
and to what standard, suppliers can ensure that the product as
sold to the consumer by the operator is a proper reflection of
what is available.
"Mechanisms can be put in place to ensure this happens and
these will be even more effective if they are consistent and coordinated.
The widespread availability of good public liability insurance
would make PATA suppliers financially safe people to do business
with. If these objects could be achieved, it is then vital that
the world marketplace knows they are in place. There is no point
in being the best if you don't tell people," said Robinson.
He added, "There is clear mutual interest between Europe
and the PATA region in ensuring that risks and problems are frankly
discussed and understood, eliminated or minimised wherever reasonably
possible and the consumer is given full and accurate information.
We should be looking to be able to say to the consumer, with our
hands on our hearts: 'We explained and described exactly what
you would get and what risks you would run. With that information,
you made an informed choice and you must bear the consequences.'
Further, the financial consequences of those risks can be distributed
more evenly through the global insurance and re-insurance markets."
From the look of things, it will be a long while more before Asian
suppliers find the perfect solutions to the EC Directive issue.
WHAT'S BEEN DONE SO FAR
1. Call for action by Luzi Matzig, Diethelm Travel Thailand, at
the ASEAN Tourism Forum (TravelAsia, January 17)
2. Concensus by PATA's board of directors that something must
be done to protect members' interest (TravelAsia, January 24)
3. PATA members further discussed the EC Directive during the
PATA Annual Conference in Beijing
WHAT'S NEXT
4. PATA Asia Division meeting in Malacca this June to study whether
a legal contract can be drawn to protect members
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