21 July 2016
The Low Cost Travel Group, which is registered in Spain but has also marketed online package tours, flights and hotel accommodation in Finnish, was declared bankrupt on 15 July 2016. If you are owed receivables by a company belonging to the Low Cost Travel Group, you can either contact the bankruptcy estate or, if you have bought a package tour, apply for compensation against security lodged in Spain. Customers who have paid by credit card can also apply for a refund from the credit provider i.e. the credit card company or bank that issued the card.
The Low Cost Travel Group consists of four companies: Lowcosttravelgroup Limited, Lowcostholidays Spain S.L, Hoteling.com (part of Lowcostholidays Spain S.L) and Lowcostbeds.com A.G. Trips have been sold on websites such as www.lowcostholidays.com and www.lowcostholidays.fi.
If you have already departed
With regard to airline tickets, Low Cost Travel has announced that if you have received tickets bought via the company, they are valid as normal. Hotel payments, on the other hand, have probably not been processed and the company advises customers to contact their hotels directly about this. Please keep hold of the confirmation of order and payment confirmation related to your booking.
If your journey has not yet begun
If you have not yet received the flight tickets you have booked via the company, you should directly contact the airline in question and check whether your reservation is still valid. You should also directly contact your hotel to check whether it has received the hotel fee payment. Please keep hold of the confirmation of order and payment confirmation related to your booking.
Claim for refund from credit card company
If you have purchased your holiday using a credit card, you can also ask the credit provider – the credit card company or bank that issued the card – to refund the price of the cancelled holiday. The credit card company's liability is based on the Consumer Protection Act. For further details on claims for refunds, see our website.
Possible compensation based on package holiday security Lowcostholidays Spain SL has paid the statutory security set in Spain. Consumers who have purchased a package tour (e.g. a combination of flight and hotel) can claim a refund based on this security. The European Consumer Centre in Spain has instructed European consumers who are seeking compensation based on this security to act as follows:
- Send an email written in English to the address firstname.lastname@example.org, with the following information:
- Your own personal details (name, date of birth or passport number, address, telephone number, email address)
- The details of the company (company name, company registration number, address, telephone number and email address, which can be found in the order confirmation)
- Provide details of what you are claiming compensation for (information on package tour, booking number)
- Information on the payment method (did you pay by credit card, etc?)
- The amount – in euros – for which you are claiming a refund
- Attach the following: order confirmation, proof of payment, any vouchers or tickets
- Alternatively, you can print out and fill in this form in English, scan it into digital format and send it, with the above-mentioned attachments, to email@example.com
- Low Cost Travel has issued a press release stating that claims for refunds based on the statutory security should also be sent to firstname.lastname@example.org
Further details are available from the security provider's(Dirección General de Turismo) website.
Possible compensation from bankruptcy estate
If you have purchased flights or accommodation only and paid by other means than credit card, you can apply for compensation from the bankruptcy estate.
Smith and Williamson LLP and CMB Partners UK Ltd are the receivers in charge of the Low Cost Travel Group's bankruptcy estate. Consumers should follow the announcements by the bankruptcy estate on the website: http://www.smith.williamson.co.uk/lowcosttravelgroup
Unfortunately, consumers are in a weak position in the event of bankruptcy. Creditors’ receivables are recovered in an order of priority, and individual consumers are usually at the bottom of the list, by which time there may be no funds left to distribute. The process often involves fees and can take several years.
Possible compensation on the basis of travel insurance
Travel insurance may cover any additional costs caused by the bankruptcy. Your insurance coverage is explained in the terms of the insurance policy. You can obtain further information on the insurance coverage directly from your insurer.
Further information for consumers:
If you would like further advice on the bankruptcy of Low Cost Travel Group or applying for compensation, contact us. We will amend our instructions for consumers as needed.