Tui agrees to be clear on refunds as regulator acts

The Competition and Markets Authority said Tui had committed to tell customers about their rights promptly and in a way that is not misleading. The CMA said Tui had taken steps to deal with its previous requests about making it easier for customers to get their money back.

TUI shares fell 1.3% to 413.26p at 13:34 BST.

With limits on foreign travel due to be relaxed on 17 May the CMA published an open letter to the package tour sector and wrote directly to the 100 operators with the most complaints reminding them about their legal obligations and telling them to make refund offers clear and easy to find.

The letter told companies they must compensate customers within 14 days if the trip is cancelled by the company and offer a full refund alongside any other offer. Customers also have the right to a full refund if they have to cancel if unavoidable or extraordinary circumstances affect the holiday.

If the government advises against travel to a destination when the customer is due to leave that is "strong evidence" of these circumstances, the CMA said. If the provider refuses a full refund it should explain in detail why it thinks the holiday is not significantly affected.

The regulator said it had received more than 23,000 complaints from consumers about problems getting refunds for holidays cancelled during the pandemic. It has taken action against Tui, Virgin Holidays and three other firms to extract more than £200m in refunds.

On Thursday, On the Beach suspended sales of summer holidays by another two months because of uncertainty created by the government's plan. It said customers had little confidence their holidays would go ahead and that even if people booked holidays there was a high chance they would be cancelled.

Andrea Coscelli, chief executive of the CMA, said: "International travel is set to resume soon and lots of people will be considering a long-awaited trip abroad. We want to make sure people are fully aware of their refund rights, so they can make informed choices about booking a holiday.

"We've secured millions in refunds for people who couldn't go on their hard-earned trips over the past year and now we're calling on package holiday companies to make the refund process less hassle in the future. We expect all firms to give clear cancellation options and will consider appropriate steps if we see companies breaking the law by refusing or delaying refunds this summer."