Mon. Nov 4th, 2024

Brussels, 9 December 2022

The European Commission has approved, under EU State aid rules, a Belgian scheme to support insurers that cover travel operators’ insolvency. The aim of the scheme is to preserve the protection of consumers in the event of insolvency of a travel operator.

Under the Package Travel Directive, package travel organisers are required to ensure that travelers will be reimbursed any payment for services that were not provided, either fully or in part, because of the organiser’s insolvency. For this purpose, Belgium has decided to set up the Travel Insolvency Fund (‘the Fund’), financed notably by contributions from insurers and aimed at covering the risks related to a large-scale insolvency of package travel operators.

Under the scheme, the Belgian authorities will only intervene in extreme cases, where the losses stemming from the travel operators’ insolvency exceed the resources of the Fund and provided that the insurers covered a share of those losses. In such case, the Belgian authorities would make exceptional contribution to the Fund, up to a maximum amount of €70 million per year. The scheme will run until 31 December 2028.

The Commission assessed the scheme under the EU State aid rules, and in particular under Article 107(3)(c) of the Treaty on the Functioning of the European Union, which enables Member States to support the development of certain economic activities subject to certain conditions. The Commission found that the scheme is necessary and appropriate to ensure consumers are reimbursed in the event of insolvency of package travel operators. Furthermore, the Commission concluded that the scheme is proportionate, as it is limited to the minimum necessary, and has a limited impact on competition and trade between Member States. On this basis, the Commission approved the scheme under EU State aid rules.

The non-confidential version of the decision will be made available under the case number SA.103238 in the State aid register on the Commission’s competition website.

Source – EU Commission

 

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