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The widened scope of consumer protection under the new Package Travel Directive (PTD) has been broadly welcomed even by major online travel agents (OTAs).
But OTAs are less happy about a new class of protected booking, the Linked Travel Arrangement (LTA), which will apply to online ‘click-through’ sales between sites.
Jean-Philippe Monod, European head of corporate and government affairs at Expedia, appealed for guidance from the European Commission last week. He told a Fieldfisher briefing on data privacy in travel: “The more you dive into this, the more questions there are.”
What is an LTA?
Monod, who also chairs the European Travel and Technology Services Association (Ettsa), argued it is unclear what constitutes an LTA – which is designed to cover click-through sales, say, between an airline or OTA and accommodation provider.
The PTD states a link between websites will create an LTA where, after confirming the booking of a first service, a trader “facilitates in a targeted manner the procurement of at least one additional travel service from another trader”.
It distinguishes LTAs from “links through which travellers are simply informed about further travel services in a general way . . . or if ‘cookies’ or metadata are used to place advertisements on websites”.
Yet Monod queried what “targeted” would mean in practice and said the requirement for ‘linked’ traders to share customer information raised issues. A trader who sells a first service, suchas a flight, will have to inform the consumer of the financial protection that applies if they make a second purchase on a linked site and create a ‘linked arrangement’. So the second trader will need to relay information on the second booking to the first trader.
Monod said: “Traders will have data-sharing problems and [could face] a competition law probe because the first trader could calculate the conversion rate and effectiveness of an advert [by thesecond trader]. Cost-per-click information is sensitive.”
The sheer volume of shared data could also be an issue. Monod said: “90% of clicks to a second trader lead nowhere so in 90% of cases there will be no LTA.” He added: “If you’re a consumer, how do you prove you have an LTA? Site one only has proof you bought a flight; site two of accommodation. It will make LTAs very complicated.”
Jason Hawthorne, legal director at Expedia subsidiary ebookers, suggested the data-transfer requirements could stop OTAs selling anything that might be considered a linked arrangement.
Hawthorne said: “The minimum required data transfer will be an email address, the traveller’s name, travel date, booking date and time, booking reference number and breakdown of travel components. That is an enormous amount to transfer.”
He suggested: “Data for all bookings will need to be transferred so a huge amount will be irrelevant. Can companies even do it with their technology? Change and cancellation data will also need to be transferred.”
When an LTA is created, traders “facilitating” the arrangements will be required to provide insolvency protection and inform consumers precisely what they have bought and what is protected. Hawthorne said: “The required disclosure is 150 words. How will that look on a smartphone? It is awkward.”
He described the LTA rules as “a nightmare”, suggested OTAs may have to deal with “different interpretations of what is in or out of scope” in different EU member states, and warned: “With the headaches and technical challenges, a lot of traders will simply avoid LTAs completely.”
The UK industry is awaiting a consultation on how the directive, due to come into force in 2018, will be implemented.