Modification of the Joint Liability Regime in the area of Combined Travel

Today, March 1, 2022, Law 4/2022, of February 25, on the protection of consumers and users in situations of social and economic vulnerability, was published in the Official State Gazette, which will enter into force tomorrow.

This law, whose origin is Royal Decree-Law 1/2021, of January 19, the protection of consumers and users in situations of social and economic vulnerability, includes, among other novelties, an amendment to the regulations on package trips to eliminate the joint liability regime that until now has been applied between wholesaler/organizing and retail/retail agencies for the correct compliance of the travel services included in the contract, thus collecting one of the main requirements for that the travel agency sector has been struggling for years.

The solidarity regime between wholesale and retail agencies means that the customer who contracts a package trip can demand liability (request compensation for a breach of the package trip or a defective performance of the service, among others) from any of them regardless of whether or not the claimed agency has contributed to that breach. Certainly, the law recognizes the subsequent right of repetition to complain against the truly defaulting agency, but that does not repair the damage to the treasury of the agency that returns the amount, as we have been able to see during the refunds that have occurred after cancellations due to COVID-19.

Therefore, retail agencies (in the vast majority of cases) have been obliged to compensate their clients for these breaches, despite not having direct responsibility for the provision of the contracted services that make up the package trip, but only because they are the point of sale of them.

We already know that all legislation on consumers and users has its cause in the successive directives that have been adopted by the Community institutions to harmonize the laws of the Member States of the European Union in this area, also with regard to package travel, as understood as a basic pillar for the achievement of the common market; however, its guidelines did not include the principle of solidarity between agencies.

Indeed, this principle referred to in the Supreme Court's jurisprudence by “the need to unify the doctrine surrounding the interpretation of art. 11 Law 21/1995, on Combined Travel leads to the declaration that the responsibility of the wholesaler or organizer is in solidarity with the retailer or travel agent vis-à-vis the consumer, without prejudice to the return actions that exist between them” (Civil Chamber Judgment of January 20, 2010), was positivized in the reform of the already distant law of 1995, as well as in the Consolidated Text of the General Law for the Defense of Consumers and Users and other complementary regulations approved by Royal Decree 1/2007, of November 16, the latest version of which was found in article 161 as drafted by Royal Decree-Law 23/2018, of December 21, without there being an obligation to harmonize on this point.

Well, this regime comes to an end with the approved law, since the reform states that the agencies “they will only be liable to the traveler for the correct fulfillment of the travel services included in the contract based on the obligations that correspond to them due to their scope of management of the package trip, regardless of whether these services must be performed by themselves or by other providers”.

In this way, the agency will only be responsible for the consequences that derive from its scope of management; however, the consumer will have the right to direct their complaints for breaches or defective compliance with respect to the services that make up the package trip, without distinction to organizers or retailers, who will be obliged to inform about the existing liability regime, to process the complaint directly or by referral to the appropriate person, as well as to report the evolution of the same to the traveler even if he is outside its scope of management.

The retailer's failure to handle the complaint will mean that they must respond jointly and severally with the organizer to the traveler for the correct fulfilment of the package travel obligations that have been in question. In the same way, the organizer's failure to handle the complaint will mean that he must respond jointly and severally with the retailer to the traveler for the correct fulfillment of the package travel obligations that correspond to the retailer due to his area of management.

This means that the law sanctions travel agencies that do not properly process the traveler's complaint with the joint liability regime, making the management of the complaint the real “crux” of solidarity between agencies, which is reinforced by the fact that it is the agency that receives the complaint that must prove that it has acted diligently and immediately once it has been submitted by the client.

On the other hand, the revision made to the liability regime between agencies involved in a package trip keeps intact the right of repetition over the person actually responsible for the fulfillment of the obligation deriving from the package trip, as well as the right to compensation against third parties who have contributed to the occurrence of the act for which the compensation was reduced, or an obligation that did not correspond to the claimed agency.

In short, the modification of the agency liability regime approved today seems to put an end to one of the main sources of discussion that have been developing in the tourism sector in recent years.

José Luis Valencia (T&L Attorney)