The Civil Aviation Authority (CAA) introduces today (1 April) the ATOL Protection Contribution (APC), which will bring significant benefits to licence holders through the simplification of the current protection scheme as CAA stated.

This reform of ATOL is the culmination of work undertaken by the CAA following the Government’s decision last autumn to proceed with the introduction of the APC payable by licence holders that will replenish the Air Travel Trust Fund (ATTF) and replace bonding as the primary means of protecting consumers.  The ATTF will also benefit from:

• New banking arrangements with Barclays Commercial Bank which include a five year revolving credit facility;
• An insurance policy arranged with major insurance companies that will provide additional funds in the unlikely event of the failure of one of the largest licence holders.

Consumers will continue to receive the same comprehensive financial protection under the ATOL Scheme as before, but the majority of the 2,500 ATOL holders will benefit by no longer having to provide a bond to the CAA.

Key Changes to ATOL Protection Arrangements from 1 April:

• The release of bonds held by most licence holders joining the APC scheme on 1 April, as well as revised bond requirements and overtrading guarantees for new entrants;
• Clearer information (in brochures, websites and sales documents) for customers purchasing ATOL Protected travel arrangements;
• Minimum business system requirements for all licence holders to improve compliance;
• The Appointment of a Compliance Manager by each licence holder, whose initial role will be to oversee the smooth introduction of the new requirements; and
• A new on-line facility available for ATOL holders to report booking figures and the automated collection of APC payments.

Richard Jackson, Director of the CAA’s Consumer Protection Group, which manages ATOL, said: “The introduction of the APC on 1 April is the culmination of the CAA’s ATOL reform project.  We are grateful for the support and hard work of the Government, industry and financial institutions to bring APC and the necessary supporting infrastructure into place, and we are pleased that we have achieved this in the planned timescale”.

Richard Jackson added: “The CAA now needs to bed in these new arrangements with the industry, and make sure licence holders understand the new licence conditions and the arrangements for the payment of the APC that will apply from 1 April.”