EC approves ‘necessary’ German voucher scheme

Germany Berlin

The European Commission has approved, under EU State aid rules, a German State guarantee scheme worth €840m to cover vouchers issued by travel operators.

The EC found that the scheme was “necessary, appropriate and proportionate to remedy a serious disturbance in the German economy”.

The scheme applies to cancelled travel packages booked prior to 8 March 2020.

Executive vice-president Margrethe Vestager, in charge of competition policy, said: "The rights of consumers to be compensated for cancelled bookings must be ensured, even in these difficult times for the travel industry due to the coronavirus outbreak. The use of vouchers should be encouraged and travellers should be able to accept them without fear of losing their money. This €840m German guarantee scheme will protect consumers, while helping companies in the travel industry to cover their immediate liquidity needs and continue their activities.” 

In Germany, as of end-April, travel packages amounting to €6bn in total were booked before 8 March and still outstanding. Some of these bookings were already cancelled because of the emergency measures necessary to limit the spread of the coronavirus, and more may have to be cancelled in the future. The EC said that, for a large portion of the cancelled bookings, customers had been refunded by tour operators or have been offered replacement bookings.

It was estimated that travel operators will issue €1.5bn-worth of secured vouchers to compensate customers for the remaining cancelled travel packages.

The scheme aims to ensure that any traveller accepting a voucher issued by a travel operator will be able to either use it or receive a full refund. The vouchers will remain valid until 31 December 2021. If not used before this date, the full amount paid will be reimbursed to the customer.