Package holiday

Any person with a business permit for commercial activities can offer travellers:

The professional must fulfil certain obligations in terms of providing pre-contractual information to the traveller. They must also insure themselves against insolvency and guarantee the repatriation of the traveller if needed.

In terms of their organisation, both package holidays and associated travel arrangements are categorised as holiday-related services. Those services include:

  • the transportation of passengers;
  • accommodation which:
    • is not included in the transportation;
    • does not have a residential purpose;
  • car rentals (category-B driver's licence) or motorcycle rentals (category-A driver's licence);
  • any other tourism-related services that are an essential characteristic of the traveller's trip.

The choice of whether to provide travel services in the form of associated travel arrangements or package holidays depends on the business model that the professional wishes to adopt, and on the responsibilities they are willing to assume.

In the case of a package holiday, the professional is responsible for all of the services included in the package. In the case of associated travel arrangements, the professional is responsible only for those services that they undertake to offer.

Who is concerned

Organiser of a package holiday

Situation 1

Package holidays can be organised by all natural or legal persons who wish to offer a combination of at least 2 types of travel services for the following:

  • one and the same trip; or
  • one and the same holiday stay.

The natural or legal person creates the package holiday and sells it by their own means. They can also offer it for sale via an intermediary, such as a travel agency, for instance.

Example of a package holiday: the organiser offers an all-inclusive package.

Example of an organiser of a package holiday:

  • a tour operator;
  • a travel agency that creates and sells the package holiday itself;
  • a hotel that creates and sells the package holiday itself.

Situation 2

Package holidays can be provided by any legal or natural person who sells a new travel service in connection with an existing travel arrangement purchased by the traveller within 24 hours following the conclusion of the travel contract.

Example: a hotel offers ski passes on its website. The hotel forwards the traveller's contact details to the ski resort responsible for the ski passes. The ski pass is purchased by the traveller within 24 hours following the purchase of the overnight stay(s). It has now become part of the package deal.

In this example, skiing is now another tourism-related service representing an essential characteristic of the traveller's trip.

Trader

In the framework of the sale of a package holiday, traders are professionals who sell or offer for sale a package designed by an organiser.

Travel agencies can play the part of such an intermediary.

Excluded services

This regulation does not apply to:

  • trips lasting less than 24 hours, unless an overnight stay is included in the trip;
  • trips organised on an occasional and not-for-profit basis for a limited group of travellers;
  • business trips.

Prerequisites

Professionals who offer associated travel arrangements must take out insurance against insolvency and repatriation, covering:

  • all payments made by travellers or on their behalf;
  • any services that have not yet been provided due to insolvency;
  • the estimated costs of repatriation.

Traders representing an organiser established outside of the European Economic Area must have an insolvency and repatriation guarantee.

Professionals providing these services must present the Ministry of the Economy with a certificate proving that they are insured against insolvency and repatriation. The form of said certificate is free. However, the following information must be included:

  • their corporate name;
  • their trade name if they have one;
  • the address of their head office;
  • the phone number and email address where the insurer/guarantor can be reached;
  • the insurer/guarantor's identification number (e.g. Luxembourg business identification (R.C.S.) number, national identification number);
  • the maximum amount of risk coverage;
  • the expiry date of said coverage.
In the event of repatriation, the guarantee must also cover the cost of accommodation until repatriation is possible.

All this information can be found on Guichet.lu directly.

Preliminary steps

Natural or legal persons who wish to trade in package holidays must first obtain a business permit for commercial activities.

Traders must also hold a business permit for commercial activities.

Applicants must enclose the certificate of insolvency and repatriation guarantee to their application.

Business permits for travel agencies whether held by a natural or a legal person and obtained under the previous legislation with a validity until 30 June 2018 remain valid. The persons in question need not apply to have their business permit changed to a business permit for commercial activity. However, they must be insured against insolvency and repatriation in order to keep their old business permit.

Persons who already hold a business permit for commercial activities and who wish to undertake a commercial activity specialised in travel services must submit their certificate of insurance against insolvency and repatriation to the Ministry of the Economy at their own initiative.

How to proceed

Obligations of the organiser and trader with respect to package holidays

Compulsory information to be included in the offer

The professional must inform the traveller by means of a standardised form. The information must be:

  • clear;
  • understandable;
  • obvious;
  • legible.

The information provided by the organiser must detail the main characteristics of the travel services. Such information may also be provided by the trader.

The information that must be provided includes:

  • details on the organisation of the trip, and specifically:
    • the destination(s), itinerary and lengths of stay, including the dates and, if accommodation is included, the number of overnight stays;
    • the means, characteristics and categories of transportation, the locations, dates and times of departure and return, the duration and location of stops and connections. If the exact time is not yet set, the organiser must inform the traveller of the approximate times of departure and return;
  • the services included in the package, and specifically:
    • the location, main characteristics and, where applicable, the tourist category of the accommodation in accordance with the laws of the destination country;
    • any meals that will be provided;
    • any tours, excursions or other services included in the total price of the package deal agreed upon;
Example: a hotel with full or half board.
  • the means of communication of the information, namely:
    • whether the travel services are offered to the traveller as a member of a group, and, in that case, the approximate size of the group, if known;
    • the language in which the services will be provided;
    • whether the trip or holiday stay is suited, overall, to persons with reduced mobility;
    • at the traveller's request, precise information on whether the trip or holiday stay is suited to the traveller's needs;
  • the company name and geographic address of the organiser and/or trader, as well as their phone number and, where applicable, their email address;
  • the price and possible means of payment, and specifically:
    • the total price of the package, including taxes and, where applicable, all fees, charges or other additional costs or, if these cannot reasonably be calculated before the conclusion of the contract, an indication of the type of additional costs that the traveller may have to pay;
    • the terms and conditions of payment, including the amount or percentage of the price to be paid as a deposit, and the schedule for payment of the balance, or the financial guarantees to be paid or provided by the traveller;
If the organiser or agent has not informed the traveller about the fees, duties and other additional cost prior to the conclusion of the contract, the costs cannot be claimed from the traveller.
  • the quota of travellers required for the package to go ahead, and the deadline for cancellation of the contract before the commencement of the trip if that number is not reached;
Example: the package holiday will be cancelled if there are fewer than 5 participants.
  • the relevant conditions in terms of passports and visas, including the approximate time it will take to obtain the required visas;
  • information on the health requirements for the destination country;
  • a statement specifying that the traveller may terminate the contract at any time before the start of the trip, upon payment of appropriate cancellation fees or, where applicable, standard cancellation fees which may be claimed by the organiser;
  • information concerning compulsory or optional insurance covering cancellation fees if the contract is terminated by the traveller, or concerning the cost of assistance, covering repatriation in the event of an accident, illness or death.
If the package is booked by telephone, the traveller must subsequently be provided with this information in writing by the organiser or trader.

Information obligation once the contract has been entered into

The contract is entered into when the traveller accepts the package at the agreed price. The pre-contractual information then becomes a fully integral part of the contract.

The traveller must be provided with a copy or confirmation of the contract on a long-lasting medium. Travellers can request a paper copy if the contract was concluded in the physical presence of the traveller and organiser/trader.

The organiser must indicate the following in the contract:

  • the pre-contractual information;
  • the traveller's specific requirements that have been accepted by the organiser;
  • the following statements:
    • the organiser is fully responsible for the proper execution of all travel services included in the package;
    • the organiser must provide the traveller with aid if the latter is in trouble;
    • the name of the organisation providing insolvency protection, together with its contact details, including its geographic address, or the name and contact details of the competent authority appointed in the specific EU member state as a guarantee fund, or an insurance company appointed or chosen to handle cases of insolvency;
    • the name, address, telephone number, email address and, where applicable, fax number of the organiser's local representative, a point of contact or another service through which the traveller can quickly get in touch with the organiser and communicate effectively with them, request help if they (the traveller) are in difficulty, or lodge a complaint in the event of any non-compliance during the execution of the package trip;
    • the traveller is obliged to report any nonconformity they detect in the execution of the contract;
    • when minors, unaccompanied by a parent or other authorised person, are travelling under a package-holiday contract that includes accommodation, information on establishing direct contact with the minor, or with the person responsible for them at the place where the minor is staying;
    • information concerning the internal procedures in place to deal with complaints and about the mechanisms for settling disputes out of court;
    • the traveller's right to transfer their contract to another traveller.
It is up to the organiser/trader to prove that they have fulfilled their obligation to inform the traveller. If such information is omitted in the contract, the latter will be considered null and void.

Should any modifications need to be made to the package, the organiser or trader must inform the traveller before executing the contract.

Modification of the price of the package holiday before its start

There are 3 circumstances in which the organiser may alter the price:

  • the package includes a form of transport whose cost depends on that of a particular fuel or other energy source;
  • the level of taxes and duties depends on a third party to the contract, who decides to change them;
  • the price of the package is based on an exchange rate, which changes.

The organiser must inform the traveller of any mark-up in price:

  • in clear and understandable terms;
  • along with a justifiable reason and a calculation;
The justifiable reason must substantiate the change in price.
  • on a long-lasting medium;
  • at least 20 days before departure.
If the price increase exceeds 8 % of the total price of the package, the traveller may cancel the package without having to pay any cancellation fees.

Modification of other clauses in the package contract before the start of the trip

The organiser may not modify the terms of the contract, unless:

  • the organiser has reserved the right to do so in the contract;
  • it is only a minor change;
  • the traveller has been informed of such a change by the organiser in clear, understandable and obvious terms;
  • the organiser has provided the traveller with such information on a long-lasting medium.

The organiser must inform the traveller in a timely manner to allow them a reasonable amount of time to reflect on how to respond. The organiser can receive 2 types of answer from the traveller:

  • the traveller accepts the proposed modification;
  • the traveller terminates the contract without having to pay any cancellation fees. Should the contract be terminated, the organiser must refund all payments made by the traveller within 14 days of the termination.

In informing the traveller of the proposed change, the organiser must alert the traveller to the contractual consequences of their failing to respond.

If the change of the contract entails a decrease in quality of the package, the organiser risks having to offer the traveller an adequate reduction in the price of the package.

Transfer of the package to another traveller

A traveller may transfer their package holiday to another traveller within a reasonable period prior to its execution.

In that case, if the organiser incurs any additional costs impacting on the package, they must inform the new traveller of those additional costs.

They must not be unreasonable, and must not exceed the true cost of the transfer of the package.

The organiser must prove to the new traveller that the additional costs are genuine, without the new traveller having to ask for such information.

The organiser must put the terms for the transfer in the contract.

Cancellation of the trip by the organiser

The organiser may cancel the trip before the start of the contract. In that case, any and all payments made by the traveller must be fully reimbursed by the organiser.

The traveller may claim additional compensation from the organiser. However, the organiser is under no obligation to pay any additional compensation if:

  • the number of travellers that signed up for the package is less than the minimum required number provided for in the contract;
  • the organiser informs the traveller of the cancellation of the trip:
    • 20 days before the start of the trip, if the trip lasts more than 6 days;
    • 7 days before the start of the trip, if the trip lasts between 2 and 6 days;
    • 48 hours before the start of the trip, if the trip lasts less than 2 days.

The traveller is not entitled to any additional compensation if the trip is cancelled due to exceptional and unavoidable circumstances. However, the organiser must notify the traveller of the cancellation as soon as possible before the date on which the trip was scheduled to start.

Withdrawal by the traveller

The traveller may cancel their trip at any time prior to the start of the contract.

The organiser may ask the traveller to pay any reasonable and justifiable cancellation costs. The organiser can stipulate reasonable cancellation fees in the contract.

The traveller shall not be liable for any cancellation fees if their withdrawal is a result of exceptional and unavoidable circumstances occurring in the immediate vicinity of the destination, or if such circumstances prevent the execution of the package or the transportation of the passengers.

Example: A one-week package trip to Iceland is planned, but the organisation of the package holiday or the transport is affected by a volcanic eruption.

Liability of the organiser for the good execution of the package holiday

The organiser is responsible for providing the services included in the package even if they sub-contract the services to other providers.

In the event of non-conformity, the organiser shall be deemed liable. They must remedy any such shortcomings, unless:

  • it is impossible for them to do so;
  • the cost of doing so is disproportionate given the non-conformity at issue or the value of the travel services affected.
The traveller must inform the organiser of any non-conformity they notice as soon as possible.

If the organiser is able to remedy the non-conformity, they must take action within a reasonable period of time.

If the organiser fails to remedy the non-conformity, the traveller is rightfully entitled to:

  • remedy the non-conformity themselves;
  • claim a refund of any expenses incurred.

If the non-conformity disrupts a significant portion of the travel services, the organiser must offer to provide other services of equal or better quality to enable the package holiday to proceed. In such cases, the traveller may not be charged any additional costs by the organiser.

The organiser may not refuse the cancellation of the package holiday by the traveller if the non-conformity significantly disrupts the execution of the package and the organiser does not rectify the problem within a period of time set by the traveller.

If the organiser is unable to offer an alternative service, or if the traveller refuses the proposed alternative, then the organiser must:

  • reduce the price of the package; or
  • compensate the traveller; or
  • reduce the price of the package and compensate the traveller as well.

If the non-conformity shortens the duration of the trip, the traveller must be repatriated without delay, at the organiser's expense.

If the organiser cannot repatriate the traveller due to exceptional and unavoidable circumstances, then the organiser must bear the cost of accommodating the traveller in an establishment of the same category as that originally included in the package, for up to 3 nights.

Intervention possibilities of the organiser and trader with respect to package holidays

THE ORGANISER

INTERVENTION

THE TRADER

INTERVENTION

Pre-contractual information to be provided to the traveller in a contract or as a confirmation 

x

Pre-contractual information to be provided to the traveller in a contract or as a confirmation

x

Can modify the price of the package in certain conditions = obligation to provide information to the traveller 

x

The price of the package cannot be changed

 

Can cancel the contract and reimburses the traveller

x

Cannot cancel the contract

 

Is responsible for the execution of the package and the conformity of the contract with the initial offer

x

Acts as an intermediary in the case of complaints concerning the proper execution of the package

x

Obligation to insure themselves against insolvency and to guarantee the repatriation of the traveller

x

Traders representing an organiser established outside of the European Economic Area must have an insolvency and repatriation guarantee.

x

Recourse against the consumer

If the traveller violates their contractual obligations, the organiser can take action against the traveller in the same way as any other consumer.

In such cases, the matter must be brought before the competent civil court with jurisdiction for the consumer's place of residence. In Luxembourg, this may be:

The applicable law is that of the country where the consumer is normally resident.

If the damages are due to the actions of a third party and that said damages have forced the organiser or the trader, representing an organiser established in a non-EU country, to compensate the traveller, then the organiser or the trader can turn against said third party and seek legal redress.

The compensation due to the traveller includes:

  • a compensation; or
  • a discount

Who to contact

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