Travel agents

Coronavirus: Under fire OTAs defend ‘Force Majeure’ cancellation policy changes

Posted by Lee Hayhurst on
Coronavirus: Under fire OTAs defend ‘Force Majeure’ cancellation policy changes

Leading OTAs have defended new refund policies after criticism from hoteliers and hospitality providers about changes in terms and conditions due to the COVID-19 crisis.

After hoteliers accused Expedia and Booking.com of “appalling behaviour” for allowing non-refundable bookings are reimbursed without charges, they are facing calls for a competition authority probe.

In countries like the UK where there is an imposed ban on travel, OTAs have imposed extraordinary circumstances, or ‘Force Majeure’ policies, to make is easy for customer to cancel even non-refundable bookings at no cost.

The Bed and Breakfast Association this week called on the Competition and Markets Authority (CMA) to look into the changes OTA have made to their terms and conditions.

David Weston, chairman of the association, told Travolution sister publication The Caterer his organisation had written to both OTAs, arguing the changes were “unfair and damaging to small businesses”.

He added: “We would like the CMA to look into it to see if changing contracts like that is fair.”

At a time when hoteliers are fighting for the survival of their businesses, both Expedia and Booking.com have given greater flexibility to consumers with measures including abolishing cancellation charges and introducing a blanket refunding of pre-payments.

Hoteliers say they cannot afford to take on the changes put in place by OTAs, explaining that after paying bank charges on cancelled and reimbursed bookings they are making a loss.

Weston said the changes showed “a total lack of support for our members” and added: “The OTAs want to leave them with negative income while protecting their own income at all costs.

“We cannot stand by and do nothing when we are able to help make things easier. It’s important that we’re able to respond to cancellation requests as quickly and simply as we can to relieve this anxiety as much as possible for both partners and travellers.”

Emma Clark, who runs Glenegedale House on the Isle of Islay, Argyll, told The Caterer:

“We’re trying to reduce every single cost we can – the lights are out, the fires are not on. We are looking at everything to reduce costs so we don’t lose our home and our business.” She said businesses simply “cannot withstand the terms and conditions”.

Chris Whyte, managing owner of Beechfield House in Beanacre, Wiltshire, said OTAs were “behaving appallingly”. He added: “They are trashing their so-called partners to protect themselves.”

Whyte said that if OTAs would waive their commissions he would happily allow those who had booked on a discounted non-flexible rate to move their bookings, but that none had looked to do so.

In a statement, Expedia Group told Travolution: “On March 21 we began automatically opting in all partners to our Cancellation Waiver program, covering outstanding non-refundable bookings made prior to March 19 for stays between March 20 and April 30, 2020.

“Making these bookings fully refundable allows travellers to cancel via Expedia Group’s website without calling Expedia Group.  Additionally, in the event that a customer calls Expedia Group to cancel, the agent can complete the cancellation and waive all fees without contacting the hotel.

“If the partner has opted out of the program, Expedia Group will handle cancellations by providing a one-year travel voucher for the initial booking value to travellers who cancel non-refundable reservations related to dates covered by this program, allowing them to rebook at that property at a later date.

“We have not taken this decision lightly. However, we believe it is the right thing to do for our industry, for travellers and, overall, for our partners, thousands of whom have already opted-in over the past few days because they see the benefit of simplifying the cancellation process.

“The situation around the world is evolving rapidly and new government travel restrictions and advisories, flight cancellations and other COVID-19 related risks are arising from the outbreak every day.

“As a result, we’re receiving an unprecedented number of calls from travellers who, like our partners, are experiencing high levels of anxiety about the current situation.

“In many cases, they are unable to take their trip due to government-imposed travel restrictions. In other situations, it would be difficult, dangerous or socially irresponsible for them to travel.

“Like many of our partners, large numbers of travellers are facing financial uncertainty over the coming months.

“We’re also conscious that continual requests to cancel are putting a significant amount of pressure on partners by creating an unhelpful and avoidable amount of administrative tasks.

“We cannot stand by and do nothing when we are able to help make things easier. It’s important that we’re able to respond to cancellation requests as quickly and simply as we can to relieve this anxiety as much as possible for both partners and travellers.”

Booking.com said the ‘Force Majeure’ only applies to certain countries or markets and certain time periods where governments have physically restricted guests from getting to the property.

This covers all reservations made for properties in the UK, with a check-in between March 23 and April 13 and Domestic travel is included in the conditions.

The company said in a statement: “Ultimately, at Booking.com our utmost concern is for the safety and security of our customers, partners and colleagues.

“We all feel the impact that the current uncertainty around travel brings, and we believe that working with our partners to make it relatively easy for our mutual guests to change their plans is both the right thing to do and means they will be faster to return to travel when the situation improves, which in turn protects the future of our industry.

“Consumer protection associations across Europe have also long supported the principle that if travel is cancelled due to ‘extraordinary circumstances,’ consumers can claim reimbursement for the cost of travel.

“In times of such extenuating circumstances, such as when governments declare travel restrictions to protect public health and safety, when a customer may not be physically able to reach the property, we support them by offering free cancellation or to modify the dates of their stay, when possible, in certain places and during certain time periods.

“In light of these government-imposed restrictions, when a hotel refunds a customer who could not travel, Booking.com of course waives any commission, as well.

“As the situation evolves, we continue to update the support we provide. This includes focusing on how best to reduce Coronavirus-related cancellations by encouraging date changes, while devising new ways to reduce the operational workload we know date change requests currently generate for accommodation partners, as well as leveraging all marketing channels possible to source, secure and funnel any demand that exists in the market right now to our partners.”

Comments

This is a community-moderated forum.
All post are the individual views of the respective commenter and are not the expressed views of Travolution.
By posting your comments you agree to accept our Terms & Conditions.

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.