Brexit – Travlaw’s Pre-New Year Update on ‘The Deal’

In this article, the Travlaw team look at the Trade and Co-operation Agreement (“the Deal”) between the UK and the EU, and specifically what this means for the travel and leisure industry. You can insert your own “Devil Is In The Detail” quote/comment/joke here – but actually finding detail in the 1246 page agreement that relates to our sector is, well, difficult. There isn’t an awful lot that specifically relates to travel & leisure, and some of the “big ticket” items that apply across the board, such as whether the EU has adopted a mutual adequacy finding in respect of Data, are not covered off fully either.

In our view, the industry is still in a better place than had there been “No Deal”, but presumably there are various further announcements to be made. Of course, all of this is subject to actual sign off by both the EU (Commission and Parliament) and UK Parliament, although at the time of writing that seems to be a given. In any event, here is the Travlaw take on the issues of most interest to the industry – this isn’t just information, this is insight, people!

The Package Travel Regulations 2018

There is no mention at all of Package Travel and therefore we assume that the Package Travel and Linked Travel Arrangements (Amendment) (EU Exit) Regulations 2018 will come into force on the 1st of January 2021 as largely expected. These Regulations remove all references in the current Package Travel Regulations to the EU and EEA. We will come back to the issue of cross border recognition of financial protection in its own right, later.

One of the questions that has been asked repeatedly by the industry is whether the Package Travel Regulations will be removed, or amended following the 1st of January 2021. Of course, no one knows for sure, but our view remains that no significant changes are likely to be forthcoming. Certainly a few aspects of the Regulations have been found to be wanting as a result of Covid-19, but whilst it is reasonable to expect the UK Government to consider a “Review” of the Package Travel Regulations, the industry should not expect any changes any time soon.

Travel Insurance and European Health Insurance Card (“EHIC”)

One of the more surprising developments in the Deal is that reports of the demise of EHIC were much exaggerated. Current EHICs will remain valid until their five-year terms expire, and following that they are set to be replaced by a new scheme – the UK Global Health Insurance Card (or “GHIC”). Details are set to follow, but it seems to us that it is set up to be EHIC by another name.

None of this changes what has always been very, very good advice – that consumers are daft if they do not obtain sensible travel insurance for their European trips in addition to having an EHIC/GHIC. Arguments for mandatory travel insurance, a la motor insurance, are only going to get louder following what have been … tricky times for consumers, insurers and travel companies during the Covid-19 crisis, but that is a debate for another day.

Travelling With Pets/Animals

As expected, EU pet passports will no longer be valid, but UK travellers will still be able to travel with pets, albeit again following the implementation of a new process which looks and sounds very much like the EU scheme, although with more complexities. We hope that more guidance is forthcoming in short order for those travel companies which provide trips for consumers and their animals without the increased burden that the new scheme seems to imply. It seems to us that this would be a good time to review the landscape for Emotional Support Animals, as arranging trips for travellers with ESAs has been increasingly an issue where the regulatory side of things has been lagging behind the demand and usage.

Mobile Roaming

The EU & UK have agreed to “co-operate” on international mobile roaming, but there is not actually anything in the agreement that would stop UK travellers being charged for using their mobile telephone phone in the EU and vice versa. The “proof will be in the pudding” here and travel businesses will soon, we suspect, be in a position to know and recommend for or against any mobile networks which resile away from what has been a settled position for many years. In our view, it is a brave network which starts to charge like they did back in their “good old days” and indeed the latest reports from the “Big Four” suggest they are not planning any increases.

Driving Licences

In another slight, but pleasant surprise the need for an International Driver’s Permit to drive within the EU (subject to a few points, notably whether drivers still have an older paper licence from certain parts of the UK) has been removed. That is not quite the end of the matter as there is a need for proof of the correct kind of insurance being in place, but all things considered this makes driving in the EU a lot easier than was previously expected and will allow travel businesses to still sell car hire with no obvious concerns. Like passports & visas (see below) the ultimate responsibility for “Getting it right” remains with the drivers, but travel companies will want to make sure their staff are trained so as to be proficient with the new scheme.

Data

As mentioned – one of the “Big Ticket” issues, and fundamental for all businesses going forward. As such, we were surprised not to have some kind of definitive answers as to whether the EU recognises the UK as having an “Adequate” data regime so as to allow the continued uninhibited transfer of personal data from the EU/EEA to the UK and back again . It feels like a bit of a “no brainer” for a number of reasons, but every travel business has a vested interest in such a finding being made, as it allows the “status quo” on data to largely continue as it did pre-Brexit. It’s worth mentioning that there are no changes as a result of Brexit to the way UK businesses send personal data to the EU/EEA, Gibraltar and other countries deemed adequate by the EU.

Perhaps promisingly, both the EU and UK say that they want data to flow across borders as smoothly as possible, but the agreement also stresses that individuals have a right to the protection of personal data and privacy and that “high standards in this regard contribute to trust in the digital economy and to the development of trade”. Combined with an announced “specified period” until adequacy decisions come into effect of four months (extendable by a further two months), in which data can be exchanged in the same way it is now it does look as though that is the way the wind is blowing.

What this means in practice then is that the transition period in respect of personal data transfers between the EU and the UK only has been extended by up to six months. Whilst this means that pending an adequacy finding by the EU, in relation to data transfers between the UK and the EU/EEA you don’t as yet need to make any changes, but watch this space as we keep an eye on this. If an adequacy decision by the EU is not forthcoming, the most likely consequence will be that you will need to update your data processing clauses/ contracts to include the be looking to rely on Standard Contractual Clauses as a basis for the transfer of that data from the EU/EEA to the UK,

For data transfers to the UK from countries which had deemed the EU (as it included the UK) as adequate, we understand that 11 of the 12 countries will maintain unrestricted personal data flows with the UK from 2021

Separately to the issue of data transfers, you will still need to be looking at other areas where you need to take action, such as updating/reviewing your Privacy Policy and making sure you have appointed a data protection representative in the EU if you are making sales to EU consumers.

Passports & Visas

For a long time now we have been making the point that travel businesses will be seen as experts in the field of passport & visa knowledge. It is not your job, per se, to know the rules inside out, but rather to provide the right information sources for travellers to check themselves. However, at the same time, you will want to have as much knowledge as possible. Again, training will be key.

The basic rules will be that UK nationals will be able to stay in the EU for at least 90 days in any 180-day period. That would seem to cover the majority of holidaymakers – for instance, an Easter weekend in Spain, followed by a June fortnight in Italy would easily be covered by the 90-day limit. There are different rules for Bulgaria, Croatia, Cyprus and Romania which basically amount to having a more flexible position. Anyone wanting to stay for longer, or to work, study or for business travel may need to check the current position. Additionally, from 2022, the plan is that UK nationals will have to pay for a visa-waiver scheme in order to visit many European countries.

We anticipate some teething problems on passport validity in particular. Everyone needs to check their passports, as they will largely only be valid for EU travel if it is less than 10 years old and has a minimum of six months left before it runs out.

The position on business travel appears to be a victory for common sense in that there will be no undue restrictions on travelling with business equipment such as laptops etc… and that other business related items will not attract the kind of bureaucratic red tape that had once been feared. This will come as some welcome respite to the business travel community, and corporate travellers everywhere.

As a reminder, travel to the Republic of Ireland is far less stringent due to the long-standing “Common Travel Area” agreement.

Courts & Law

Making contribution claims and recovery claims from overseas suppliers will be much harder going forward – without a doubt.

Ahead of coming back to that point, it is worth mentioning that for the majority of the UK, the Supreme Court will now be the highest authority in the land, with no references or appeals to The Court of Justice of the European Union (CJEU) being possible. However, of note is that this is not the case for Northern Ireland, which has a special status under the terms of the Deal and will remain subject to the EU single market and customs union rules. This means that the CJEU will remain the highest legal authority for some disputes in Northern Ireland. We wonder whether the potential for divergence on key issues for the travel industry, such as how notable points in personal injury cases, might cause some head scratching in the future.

There is a lot in the Deal about Criminal law, but nothing about the Civil side of things, which applies far more to our sector, for one reason or another. Practitioners of cross border trade and litigation here in the UK, like Travlaw, have long been calling for clarity on what will happen post Brexit. However, in short, at the time of writing it looks to be a real mess and for those interested in this particular element of life, it appears that the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 will apply and the “Brussels Recast” and the Service Regulations will cease to apply. Sadly, the clarity that would have been brought by the UK being a part of the Lugano Convention does not appear to be inbound.

So, coming back to the initial statement in this section, the “TLDR” of all of this is that litigation between parties in the UK and in the EU just got a lot harder. Well drafted Supplier Agreements just became even more important (and they were important before!)

Chargebacks & Section 75 of the Consumer Credit Act

The Covid-19 crisis has really shone a light on this whole area, and the regulatory regime has been found largely wanting. We here at Travlaw can honestly say that we have been audibly concerned about the impact of chargebacks in particular for many years now. The laws in Europe centre around Directive 2008/48/EC on consumer credit agreements, which was effectively implemented in the UK by the Consumer Credit Act 1974 (and its subsequent updates), all of which are in lockstep as far as rights under credit agreements go. Chargebacks are different in the sense that they a private, civil agreement put in place by credit providers. Travlaw continue to consider that a review of the concept of “chargebacks” is much needed so as to bring clarity for consumers, business and credit card providers alike, but for now realistically the travel industry needs to brace itself for there being no changes of note here in the coming years.

Status of “Interbus”

After many months of silence, it has now been quietly confirmed that the UK Government was applying for admission to the Interbus agreement all along, and will join from 1st January 2021. In essence then, this is another good development for the travel industry and will be welcomed by coach tour operators everywhere.

Mutual Recognition Of Financial Protection

Another “big ticket item”, at least for the travel & leisure industry, on which there has been zero mention thus far despite (like Data) the common sense position being a maintaining of the status quo.

However, as it stands, it will no longer be possible for the travel & leisure industry to use ATOL, or ABTA etc… to sell holiday to consumers across Europe. The EU recognising UK financial protection schemes, and vice versa, would appear to be good for everyone and bad for no one, but so far, nothing. As such, the UK finds itself increasingly looking like it was prior to 2018 – i.e. having to establish itself in an EU member state (with all that entails – and it can change from country to country) to be able to sell to consumer in the EU. The current landscape is not quite as bleak as 2018 (where a place of establishment had to be in each Member State), but it is still hard to see it as anything other than a backwards step,

Last Thoughts…

NB – This is all just a snapshot as of the end of December 2020, and there is an expectation that a number of factors will change going forward so please do keep an eye on our website for up to date information, analysis and insights.

The Travlaw Team

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