Cancellations: holiday accommodation

The CMA is investigating suspected breaches of consumer protection law in the holiday accommodation sector.

From:
Competition and Markets Authority
Published
9 June 2020
Last updated
3 July 2020 — See all updates
Case type:
Consumer enforcement
Case state:
Open
Market sector:
Recreation and leisure

Update on enforcement action

Undertakings from Sykes Cottages

3 July 2020: The CMA has today announced undertakings received from Sykes Cottages in relation to bookings prevented from going ahead due to government restrictions related to coronavirus (COVID-19).

Until recently, Sykes had been refusing to provide full cash refunds to all customers whose holidays could not go ahead because of COVID-19. Instead, Sykes customers were offered rebooking and in some cases vouchers and/or a partial refund. Consumers may have obtained refunds through other means, such as credit card chargebacks or from property owners.

This is changing following a CMA investigation opened on 13 May 2020.

Sykes has now given the CMA formal undertakings that, in summary, agree to:

  • offer a full cash refund to customers whose holidays could not go ahead due to government restrictions at the time and who have not already rebooked
  • convert credit vouchers to cash, if customers prefer (and as long as the credit voucher has not been used)
  • provide the CMA with monthly reports on how many refund offers have been made and accepted

These commitments apply to 24 businesses and brands owned by Sykes, including the Pure Cottages Group and Carbis Bay Holidays, as well as Sykes Cottages itself.

This is the second investigation into COVID-19 cancellation policies by holiday letting companies, and the CMA has again secured full refunds for customers. As set out in its guidance published on 30 April, the CMA considers that where a contract is not performed as agreed, consumer protection law will generally allow consumers to obtain a refund, and in most cases this would be a full refund.

The CMA encourages firms that are not yet complying with the CMA’s guidance to follow suit as soon as possible. The CMA is continuing with its inquiries into the holiday accommodation sector, which may ultimately lead to court action against companies which fail to comply.

Undertakings from Vacation Rentals

9 June 2020: Vacation Rentals, which operates popular accommodation sites including Hoseasons and Cottages.com, is now giving people the option of a full refund if a booking has been cancelled because of restrictions associated with the coronavirus outbreak.

Vacation Rentals voluntarily changed its policy following the CMA’s statement of April 30 as described below, and has now formally committed to such changes further to a CMA investigation opened on 13 May 2020. In particular, Vacation Rentals will:

  • offer a full refund to customers who booked holiday homes but could not stay in them due to lockdown restrictions
  • communicate its new policy clearly on its website and via social media
  • provide the CMA with monthly reports on how many refund offers have been made and accepted.

Other holiday lets firms, however, have not yet done the same and the CMA’s investigation is continuing. Common complaints include companies refusing to provide full refunds at all or offering only vouchers instead of cash refunds. The CMA will continue with its inquiries into the holiday accommodation sector, which may ultimately lead to court action against companies which fail to comply.

Investigation launch

30 April 2020: Holiday accommodation was named as one of several sectors being investigated by the Competition and Markets Authority (CMA) following reports of businesses failing to respect cancellation rights during the Coronavirus (COVID-19) pandemic.

The investigation was launched as a result of intelligence gathered by the CMA’s COVID-19 Taskforce, set up to monitor market developments and identify the big problems facing consumers as a result of the pandemic and the lockdown. The CMA had received reports that companies were refusing to refund customers for UK holiday accommodation they could no longer stay in due to lockdown restrictions.

The CMA also issued a statement on its views on consumer protection law in relation to cancellations and refunds during the current crisis.

If people have been affected by unfair cancellation terms in the wake of COVID-19, they can report them to the CMA using the CMA’s online form.

Published 9 June 2020
Last updated 3 July 2020 + show all updates

  1. Undertakings from Sykes Cottages announced in relation to refunds for bookings prevented from going ahead due to government restrictions related to coronavirus (COVID-19).

  2. First published.

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