• 11 May 2020, 18:15
  • João

EU plans to reopen internal borders and introduce state guarantees for vouchers

The European Commission is urging members to gradually open their internal borders in order to protect the tourism industry. Brussels also wants EU countries to provide state guarantees for vouchers that airlines and travel agencies offer to their customers instead of refunding cash for canceled flights

The European Commission plans to appeal to its members to gradually resume movement at their internal borders and to remove general travel bans, replacing them with more specific restrictions adapted to their particular situation. With this, the EU hopes to resume intra-European travel and improve the financial situation of tourism companies. At the same time, according to the latest recommendation, the external borders of the European Union will remain closed until June 15.

The European Commission estimates that the tourism industry within the EU generates almost €150 billion during the peak season alone, from June to August. However, due to the coronavirus pandemic, it is estimated that almost 6.4 million jobs could disappear and incomes fall from 50% (in hotels and restaurants) to almost 90% (for cruise companies and airlines).

According to Reuters , the European Commission is going to respond positively to several requests from member states to temporarily suspend the rules on reimbursement, for example, in the event of flight cancellation.

This means that  airlines, travel agencies, hotels and many other companies in the travel industry will be able to legally offer customers vouchers instead of refunds.

To provide incentives for passengers and travellers to accept vouchers instead of reimbursement, vouchers should be protected against insolvency of the issuer and remain refundable by the end of their validity if not redeemed

The condition for a positive response from the EC is that those vouchers must be guaranteed by the EU member states, in order to boost consumers confidence. Consumers will still be able to apply for cash refunds, but only when the voucher expires.

Insolvency protection should be provided at the national level, and secured vouchers should be available to all passengers and travelers, the project adds.

The EU guidelines will be officially released on Wednesday, May 13.

Main photo: Shutterstock
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