Under the Package Travel Regulations 2018, an organiser can protect packages without flights by holding customers’ money in trust. All money paid under the package contract must be held in the UK by a trustee who is independent of the organiser, until the contract has been performed or the money has been refunded or forfeited. The organiser pays the costs of running the trust.

Transport and repatriation

If the packages include transport, the organiser must also have insurance that covers bringing travellers home. It can also hold a lesser sum in trust if insurance covers the rest.

Watch out for

• “Trust account” is used loosely for any client money account. An account the company controls does not count as protection under the Regulations unless it meets their conditions, including an independent trustee and money held in the UK.

• Flight-inclusive packages are protected through ATOL rather than a trust account under the Package Travel Regulations. Within ATOL, money an agent takes for an ATOL booking is held on behalf of the trustees of the Air Travel Trust, and Accredited Bodies must use an approved trust account for payments made to their members.

• The Air Travel Trust is the fund behind ATOL, not a trust account.