On 23 September 2019, the world’s oldest travel agency, Thomas Cook which was founded in 1841, collapsed after over a decade of financial difficulties and notwithstanding a booming tourism industry. Thomas Cook counts over 19 million customers a year. Currently, an estimated 150,000 customers are left stranded while on holiday abroad.
The UK government’s Civil Aviation Authority (CAA) has aircraft on standby to step in an assist in the repatriation. Under UK law, package holiday customers are protected. The CAA scheme commonly known as ATOL (Air Travel Organiser’s Licence) was introduced in 1973 and protects over 20 million holidaymakers and travellers each year.
Only recently, Thomas Cook had succeeded in securing £900 million in funding from a Chinese investor. Nonetheless, Thomas Cook’s existing lenders and investors required the company to raise additional funds. An additional £200 million was required to cover the cyclically lower revenues over the winter months and the company failed to raise these. A final request for a bail out by the UK Government also failed, forcing the company into liquidation.
If you have any queries regarding the law around traveller’s consumer rights, but also capital raising, shareholders’ and creditors’ rights then contact us at Audley Chaucer Solicitors.
Written by Stephen Rahn