ABTA says the failure of Slovakia-based airline Sky Europe has again highlighted the gaps in the current financial protection system, which will leave some customers out of pocket and stranded abroad.
For many years ABTA has been calling on the Government to require all airlines to provide financial protection for all customers, and has now drawn up proposals which will reform the ATOL system.
The association says the current system only protects passengers who booked flights as part of a package holiday, and will ensure they will be brought home free of charge or rebooked onto other airlines.
However, in stark contrast, the majority of customers who will have booked independent arrangements may or may not get their money back as the airline has stated that it is unable to provide refunds.
“This airline failure in a tough economic climate, along with several others last year, highlights the need for urgent action by the Government and EU to plug this gaping hole in customer financial protection,” said Mark Tanzer, ABTA chief executive.
ABTA understands that Sky Europe provided flights to Prague and Slovakia from Manchester and Luton.