A lesser-known provision in package holiday terms and conditions may lead to a significant increase in the cost of a package holiday, even after it has been booked and paid for.
According to a report by Which?, this provision, outlined in the Package Travel Regulations, permits UK holiday companies to impose an additional charge of up to 8% on the total cost of a package holiday without offering the option of a free cancellation. This clause can be invoked under three circumstances: if the destination introduces new taxes or expenses, if there is a significant fluctuation in currency values, or if there is a rise in fuel or power costs. Given the current surge in fuel prices due to the ongoing Middle East conflict, holiday companies could potentially apply this clause to booked holidays if these expenses continue to escalate.
In the event of an 8% price hike, a family of four who has already spent £2,500 on a holiday might have to pay an additional £200 to their holiday provider or risk having their holiday canceled.
However, there are specific rules that holiday companies must adhere to if they intend to impose these additional charges. The increase must be directly related to specific costs, must be implemented no later than 20 days before the holiday departure, and if the price surge exceeds 8% of the holiday cost, travelers have the right to cancel without incurring any charges.
Moreover, if a holiday company includes this provision in their terms and conditions, it can also benefit the customer. The regulations stipulate that if the company reserves the right to increase prices, the traveler is entitled to a price reduction if there is a decrease in the relevant costs.
Several holiday companies, including Trailfinders, Destination2, Kuoni, Jet2holidays, Olympic Holidays, and Beachcomber Tours, have assured Which? that they will not impose surcharges on customers. On The Beach and BA Holidays have also confirmed that they will not be adding these fees.
Loveholidays stated that they have no plans to introduce surcharges, while easyJet mentioned that they do not intend to do so in 2026. Lastminute.com clarified that while they will not impose a surcharge, they cannot guarantee that airlines will not implement additional costs.
For those who have yet to book their holiday this year, it is advised to expect potentially higher costs, particularly in popular destinations like Spain where demand is higher than usual.
The surge in jet fuel prices, attributed to the Middle East situation, is expected to impact consumers as these increased costs may be passed on to them. Fuel shortages could result in airlines canceling flights, leading to higher costs due to fewer available seats.
Which? recommends that consumers, when booking holidays during uncertain times, consider that the cheapest option may not always be the best, especially in times of travel disruption. Opt for a company with strong customer service to mitigate potential issues.
TUI and Booking.com have been approached for comments.
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