The bankruptcy of FTI, one of Europe's largest tour operators, triggered an avalanche of problems for travel agencies and customers almost a year ago. Ten months after the company's insolvency, many travel agencies have still not received compensation.
The practices of the German Travel Security Fund (DRSF), which serves to insure package holidays, continue to cause anger and incomprehension within the industry. Despite the provision of numerous documents and intensive communication with the fund, many applications are progressing slowly or not at all. In this tense situation, an investigation is now underway to determine whether the DRSF's actions violate European directives and whether a complaint to the EU Commission is necessary. But what are the exact reasons behind this conflict, and what impact does it have on the travel industry and its customers?
Hesitant compensation: One year after the FTI bankruptcy
FTI's bankruptcy in the summer of 2024, which affected hundreds of thousands of travelers worldwide, represented a difficult and stressful time for many travel agencies and their clients. In particular, the Austrian travel agencies that brokered FTI tours had to deal with numerous bureaucratic hurdles after the insolvency to settle the resulting losses. In theory, the DRSF, which serves as a safety net for package travelers, was supposed to cover the resulting losses and payments not yet reimbursed for the completed tours.
But the reality is different. Gregor Kadanka, chairman of the Association of Travel Agencies in the Austrian Federal Economic Chamber, expressed his frustration in a press release about the lengthy and inadequate processing of the DRSF. "Although Austrian travel agencies submitted all customer data requested by the DRSF months ago – often via multiple channels, online and by mail – even ten months after the FTI bankruptcy, in many cases no payments have been made by the DRSF," Kadanka explained. The travel agencies' reports repeatedly point to unprocessed applications and chaotic communication, with deadlines repeatedly missed and important information not being available in a timely manner.
Problems with communication and processing
According to Kadanka, many travel agencies are anything but satisfied with the DRSF's working practices. A key problem is the lengthy processing of applications and the difficulty of reaching the DRSF. "The hotline is difficult to reach and offers little support," says the trade association chairman. The fact that documents have been requested multiple times, even though they were submitted some time ago, is also causing discontent. "The travel agencies are not responsible for the delays," Kadanka emphasizes. Rather, the DRSF must be held accountable for these problems.
A further annoyance for the affected travel agencies is the delayed introduction of an online portal by the DRSF, which was intended for data transmission and application submission. However, this portal was only available four months after the insolvency and failed to meet the travel agencies' expectations. Although payouts have already been made in a few cases, there have been reports that these payments were reduced by the travel agency's commission, which Kadanka argues is illegal. Both the EU Package Travel Directive and the German Civil Code (BGB) provide for a full refund of the travel price, not a reduction of the agent's commission.
The legal confusion: The perspective of the professional association
Another problem identified by the Austrian Travel Agency Association is the unclear handling of cases in which travel agents have made advance payments on behalf of their clients. The EU Package Travel Directive also provides for protection for these payments, which should be ensured by the DRSF.
However, the DRSF's specific interpretation of how to proceed in these cases is causing confusion. Travel agencies are faced with a legal gray area, and the trade association is calling for a clear and transparent solution that complies with the directive.
Lack of legal recourse and the planned complaint to the EU Commission
Since the DRSF currently does not provide a clear answer to these questions, affected travel agencies and customers may have to contact the legal authorities themselves. The trade association criticizes the fact that there is no direct legal recourse against the DRSF, which poses a significant problem for many travel agencies. The legal remedies available to affected travel agencies are limited, forcing many to rely on legal recourse.
In response to this situation, the trade association has already contacted the DRSF's supervisory authority, the German Ministry of Justice, and is also considering a possible complaint to the EU Commission. This complaint could lead to the EU reviewing the DRSF's practices and, in the worst case, taking action against the inadequate implementation of the EU Package Travel Directive. The industry expects the EU Commission to clarify the legal framework and ensure fair and transparent processing of compensation payments.
Long-term impact on the travel industry
The inadequate and faulty handling of the DRSF has far-reaching consequences for customer confidence in package tours and travel agencies. "The inadequate handling massively damages the package tour product and is rightly met with great incomprehension by customers and travel agencies," warns Gregor Kadanka. If customers feel they will not be adequately compensated in the event of insolvency, this could lead to a long-term loss of confidence that affects the entire travel industry.
Ten months after FTI's bankruptcy, the situation remains unclear for many travel agencies and customers. Delays in compensation payments and the lack of communication from the DRSF continue to cause frustration.
The Association of Travel Agencies is now pursuing legal action and an investigation by the EU Commission to ensure a fair and speedy settlement of compensation payments. How the situation is resolved will be crucial for the future of the package travel industry to restore the trust of customers and travel agencies.