Customers of Lowcostholidays are being urged to consider their options following the company’s decision to relocate its business to Spain.
The UK Civil Aviation Authority says the firm gave it very short notice of the move and did not provide clear information about the impact it would have on its customers’ protection.
It said Lowcostholidays has behaved "unacceptably" over the relocation and it cannot confirm for passengers what protection arrangements apply to their bookings.
"We are still carefully assessing the situation to ensure that UK consumers’ rights are protected," said the CAA.
The body said that although Lowcostholidays has been contacting its customers with forward bookings, offering them the option of cancelling and receiving a full refund or continuing with their booking under the new arrangements, their letter was "lengthy and unclear".
It also complained that customers were only given seven days, until Friday November 8, to decide.
"The CAA believes that customers are not being offered sufficient time to consider the situation and make the best choice," it added.
But Lowcostholidays CEO Paul Evans fiercely defended the company’s actions, saying it has nothing to apologise for.
"We’ve done everything absolutely properly," he said.
"We have taken the best tax advice, the best regulatory advice, we have changed all of our websites, we have all the correct Spanish licences in place and our customers are covered under the EC package travel directive. They’ve got nothing to be worried about."
He said the move to Spain was a natural one for the company, which now operates in 47 countries.
"I’m married to a Spanish women and we live in Spain, and we have been there for four years. Lowcostholidays has been operating from Spain and now employs over 100 staff in our Palma office," he said.
Evans said he could see the way things were going with the Package Travel Directive reform and wanted to "embrace it".
"Having a single trading entity through which all of our holidays are sold means we can achieve significant efficiencies and cost savings. It means our administration, operations and regulatory functions can be centralised," he added.
"It also means all of our pan European businesses will be regulated under Spanish law and effectively under the overarching regulation across Europe of the EU Package Travel Directive. Customers will benefit from full package travel protection under Spanish law, consistent with the EU package travel regulations."
The CAA said it was notified of Lowcostholidays intention to move its business to Spain late on Wednesday 30 October and the transfer occurred at midnight on 31 October.
Head of ATOL Andy Cohen said: "By giving the regulator such short notice of these changes and failing to allow their customers reasonable time to consider their situation, Lowcostholidays’ behaviour is unacceptable.
"We simply cannot say at this point what the changes might mean in practice for consumers, and for that reason think that anyone with a Lowcostholidays booking should very carefully consider their options."
by Bev Fearis
