PACKAGE TRAVEL INSOLVENCY FUND REGULATIONS

SUBSIDIARY LEGISLATION 409.18

PACKAGE TRAVEL INSOLVENCY FUND

REGULATIONS

4th October, 2016

LEGAL NOTICE 315 of 2016.

The title of these regulations is the Package Travel

Insolvency Fund Regulations.

The purpose of these regulations is to set-up an Insolvency

Fund to provide security for the refund of all payments made by or

on behalf of travellers insofar as the relevant services are not

perfo rm ed as a co nsequ ence of t he organ iser ’s in solv ency,

including repatriation where applicable. The fund shall be managed

and administered by a Managing Board as set-up by virtue of these

regulations, and also to partially transpose the provisions of the

Directive (EU) 2015/2302 of the European Parliament and of the

Council of 25 November 2015 on package travel and linked travel

arrangements, amending Regulation (EC) No 2006/2004 and

Directive 2011/83/EU of the European Parliament and of the

Council and repealing Council Directive 90/314/EEC.

(1) In these regulations, unless the context otherwise

requires

"Act" means the Malta Travel and Tourism Services Act;

"Authority" means the Malta Tourism Authority;

"the Board" means the Insolvency Fund Managing Board

established under regulation 4;

"certificate" means the certificate issued to consumers in terms

of regulation 9(3);

"consumer" shall have the same meaning given to "consumer"

under the Package Travel Regulations;

"contributor" means a package travel organiser which according

to the Managing Board should contribute to the Fund;

"Directive" means Directive (EU) 2015/2302 of the European

Parliament and of the Council of 25 November 2015 on package

travel and linked travel arrangements, amending Regulation (EC)

N o 2 0 0 6 / 2 0 0 4 a n d D i r e c t i v e 2 0 11 / 8 3 / E U o f t h e E u r o p e a n

Parliament and of the Council and repealing Council Directive 90/

314/EEC;

"FATTA" means the Federated Association of Travel & Tourism

Agents of Malta;

"th e F un d" mea ns t he In sol ven cy Fu nd r eferred to un der

regulation 8;

"Member State" means a member of the European Union;

"Minister" means the Minister responsible for tourism;

"Ministry" means the Ministry responsible for tourism;

"package" shall have the same meaning given to "package" under

the Package Travel Regulations;

"package travel organiser" means persons and, or entities who

fall within the definition "organiser" and, or "retailer" as given

under the Package Travel Regulations and, or fall within the

definition "travel agent", as defined under the Act and is duly

licensed by the Authority;

"Package Travel Regulations" means the Package Travel,

Package Holidays and Package Tours Regulations.

(2) Words and expressions used in these regulations and which

are also used in the Act, shall have, unless the context otherwise

requires, the same meaning as in the Act.

(1) The Minister shall appoint a Board, to be known as the

Insolvency Fund Managing Board, which shall consist of five-

voting members.

(2)

The five voting members of the Board shall be

(a) two persons to be nominated by the Authority;

(b) two persons to be nominated by the FATTA; and

(c) one person to be nominated by the Minister.

(3) A person shall not be qualified to be appointed as, or to

remain, a member of the Board if he is a member of the House of

Representatives.

(4) The Chairman, who shall preside the said Board, shall be

appointed by the Minister in consultation with FATTA.

(5) The members of the Board shall hold office for a period of

three (3) years, and shall be eligible for re-appointment.

(6) Any member of the Board may, before the expiration of his

term of office, resign by a letter addressed to the Minister.

Provided that any member may be removed from the Board

prior to the expiration of his term of office on any of the following

grounds

(a) the member has been guilty of misconduct;

(b) the member is unable and, or incompetent to perform

the duties of his office;

(c) the member has acted in gross negligence;

(d) any other acts or omissions unbecoming on a member

of the Board.

The Board shall have the following functions and any

ancillary functions thereto

(a) to set-up the Fund;

(b) to administer and manage the day-to-day affairs of the

Fund;

(c) to decide and examine the current travel package

market and decide who shall be deemed as a

contributor to the Fund;

(d) to monitor and control

that

contributors

are

contributing to the Fund;

(e) to report regularly to the Authority on any matter

affecting and, or relating to the Fund and the Fund’s

contributors;

(f)

to refund and, or repatriate consumers having valid

claims in accordance with these regulations;

(g) to undertake any appropriate action in connection with

the performance of its functions through the licensing

and enforcement directorates of the Authority;

(h) to assist and cooperate with other member states in

accordance with the Directive;

(i)

to annually publish the contributions made by all

contributors and such other information as provided

for under article 31(3) of the Act and any other

applicable law;

(j)

to recommend to the Authority as to whether a licence

shall be issued or not for new applications of travel

agents, after it undertakes to carry out an assessment in

accordance with its approved terms of reference;

(k) to recommend to the Authority the renewal or

otherwise, or the suspension or revocation of travel

agents’ licences and other action, as it may deem

appropriate, in accordance with its approved terms of

reference;

(l)

to submit an annual report to the Authority.

(1) The Board shall ensure that the administrative costs in

relation to carrying-out of its functions are kept to a minimum. In

addition, the Authority will provide administrative support through

its offices. The Board shall authorise the reimbursement of relative

administrative costs borne by the Authority.

(2) The Board’s administrative costs shall be paid from the

Fund itself, provided that such costs transpire from a budget

approved by the Board.

(1)

The Board shall draw its own terms of reference.

(2) The terms of reference, and any amendments thereto, shall

be approved by the Authority and endorsed by the Minister prior to

coming into effect.

(3) The terms of reference of the Board shall be published on

the Authority’s website.

(1) The Board shall set-up a fund, which fund shall be used

to refund payments made by or on behalf of travellers insofar as the

relevant services are not performed as a consequence of the

organiser’s insolvency, including repatriation where applicable.

(2) All package travel organisers which are duly licensed by

the Authority and which the Board deems as contributors, shall

contribute to the Fund.

(3) All contributors are to annually submit audited financial

statements to the Board.

(4) The Board and, or the Authority may request any

contributor to submit audited financial statements more frequently

than indicated in the previous sub-regulation and the Board and, or

the Authority may request any contributor to provide them with any

other documentation they may deem necessary.

(5)

(a) When a Contributor fails to contribute and sustain the

Fund when so requested by the Board, the provisions

of regulation 10 shall apply.

(b) The Authority shall not renew the contributor’s licence

for the following year on such failure of the

contributor to contribute and sustain the Fund.

(c) The Authority may also take any such other action in

accordance with the provisions of the Act and these

regulations.

(6) The contributor shall pay the relative contribution, which

shall be for such an amount and is to be paid in such a manner

which the Board may decide from time to time.

(7) All contributors shall remain obliged to contribute to the

Fund until they relinquish their licence with the Authority and

settle all pending claims over the said Fund.

(8) The Fund shall at all times be kept at a minimum threshold

of five hundred thousand euro (€500,000), or any other higher

amount as shall be determined by the Ministry and the Authority

from time to time.

(9) The Board shall be entitled to request any or all

contributors to contribute further to the Fund, should the Fund be

below the minimum threshold established in the previous sub-

regulation or for any other reason whatsoever.

(10) Should the Board consider that accumulated funds are in

excess of what it considers necessary to cover consumer exposure

but not less than the minimum amount established under sub-

regulation (8), any excess amounts may be distributed back to the

contributors, subject that the approval of the Authority, on the

advice of the Board, is obtained

Provided that the funds shall be distributed in such a

manner as the Board shall deem fit.

(11) In the event that one of the contributors becomes insolvent,

any claims made by the consumers of the insolvent contributor

shall be paid first from the insolvent contributor ’s share of the

contributions made under the Fund

Provided that should the insolvent contributor’s share not

suffice in order to cover all claims, then the balance shall be paid

from the net funds collected through the certification scheme

Provided further that the Board may request the other

contributors to increase their bond to cover any shortfall of funds to

settle the outstanding claims and ensure the minimum threshold is

kept and this in accordance with the provisions of sub-regulation

(8).

(1) The Board, in collaboration with FATTA, shall set-up

and manage a central online system.

(2) The system shall allow all contributors to issue certificates

to consumers. A fee, as determined by the Board, shall be paid in to

the Fund for every certificate issued.

(3) The certificate shall contain at least the following

information

(a) all prepaid amount(s) made by the consumer to the

contributor;

(b) dates of travel; and

(c) any other details which are relevant to the package

ordered and, or purchased by the client, such as

information on the accommodation provider if

applicable.

(4) All contributors are obliged to issue the certificate to their

consumers.

(5) The certificate shall be used by consumers to make any

necessary claims under the Fund should the contributor become

insolvent.

(6) The Board shall have full access to the system, and to any

information transpiring therefrom.

(1) In the event that one of the contributors becomes

insolvent, the consumer must file a claim with the Board and

provide full details of payments received, and services which are

not performed as a consequence of the organiser ’s insolvency,

including repatriation of travellers as applicable.

(2) The consumer shall, when presenting a claim, also present

the certificate, otherwise the Board shall not be obliged to provide

a refund and, or repatriate the consumer.

(3) The Fund shall only be used for claims which relate to

bookings made as from the date of the coming into force of these

regulations.

(1) Compliance with the provisions of these regulations by

contributors shall be deemed to be a condition to which a licence to

operate any tourism operation is subject, irrespective of whether

reference to these regulations is made in the licence itself.

(2) Any contributor who fails to comply with any of the

provisions of these regulations shall be guilty of an offence, and

shall be liable to the fines and penalties as indicated in articles 43

and 45 of the Act.