Collective Commentary about the New Package Travel Directive

PORTUGAL | CARLOS TORRES 1113 1) The Rechberger case , regarding a group of consumers, including Walter Rechberger, subscribers to an Austrian newspaper, who did not benefit from the trips, due to the unavailability of places because the co-organising agency went bankrupt in the meantime. The travellers had made the respective payments but only recovered a small amount in the bankruptcy process. The collapse was mainly due to the number of subscribers who signed up, and by exceeding the forecasts the travel agency co-organiser went bankrupt. The CJEU understood that “Article 7 of Directive 90/314 has not been properly transposed where national legislation does no more than require, for the coverage of the risk, a contract of insurance or a bank guarantee under which the amount of cover provided must be no less than 5% of the organiser’s turnover during the corresponding quarter of the previous calendar year, and which requires an organiser just starting up in business to base the amount of cover on his estimated turnover from his intended business as a travel organiser and does not take account of any increase in the organiser’s turnover in the current year”. 2) The Baradics case , in which Ilona Baradics and other consumers, victims of the bankruptcy of a Hungarian tour operator, sued the insurance company for the reimbursement of the number of advances or the total price paid by each of them for the purchase of package travel that was not performed. The insurance contract signed between the travel agency and the insurer provided for a maximum amount of approximately 130,000 € and, due to this limit, consumers were only compensated in 22% of the advances or prices paid, so they took legal action against the insurer and the Hungarian State to recover the remainder. The CJEU understood that Article 7 of Directive 90/314 should be interpreted “as meaning that a Member State has no discretion as regards the ambit of the risks that fall to be covered by the security to be provided by the travel organiser or retailer for the benefit of consumers. It is for the referring court to determine whether the criteria laid down by theMember State concerned for setting the amount of the security have the object or effect of limiting the ambit of the risks that fall to be covered by the security, in which case they would clearly be incompatible with the obligations under Directive 90/314 and would constitute a sufficiently serious infringement of European Union law which, subject to a finding of a direct causal link, might give rise to liability on the part of the Member State concerned”.