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ATOL News July 2018

The first issue of ATOL News covers the significant changes to the ATOL Regulations as a result of the Package Travel Directive; there is a new process for submitting reports to the CAA and an update to the ATOL training module. We’ve also included some reminders relating to information available on the ICAEW website.

Amended ATOL Regulations

Earlier on this year the Department for Transport (DfT) consulted on proposed changes to the ATOL Regulations in line with the Package Travel Directive (PTD). The amended Regulations have now been published by the CAA, with the changes effective from 1 July 2018. The key changes are; 

  • The Linked Travel Arrangements will not be included in the ATOL Regulations as licensable business. Flight-Plus has been removed, and there is a new definition of a Package (see page 3 of the new Regulations). Single-contract and Multi-contract Packages are now defined in the ATOL Standard Terms: ‘Single-contract Packages’ - those under which the consumer has the benefit of one contract with the organiser for all the travel services that are part of the package
    ‘Multi-contract Packages’ - those where the consumer has more than one contract for all the travel services that together are part of the package;
  • The CAA has updated Guidance Note 10, Requirements for ATOL Reporting Accountants. This guidance note is included in the CAA Official Record Series 3 as an appendix and was published on 8 June 2018. The CAA has advised that if there are any material changes that need to be made to the document, it will republish the note at a later date.
  • The changes to ATOL Standard Terms include that from 1 July 2018, Small Business ATOLs (SBAs) will be required to submit reports to the CAA each quarter on the number of licensable passengers and corresponding revenue, both on a booking date basis and on a departure date basis. This brings them into line with other ATOL holders. There will be no change to the period or timing for paying the ATOL protection contribution (APC) for SBAs.
  • Other changes to the ATOL holder application form, APC returns and Annual Accountant’s Report (AAR) mean that the CAA will be able to share the AARs with the professional accountancy body that has designated the ATOL Reporting Accountant (ARA). This will enable the professional accountancy body to use actual case studies in their assessment of the continuing designation of the ARA.

There are some transitional arrangements with regard to the changes:

  • No further licensable bookings for Flight-Plus sales after 1 July 2018.
  • From 1 July 2018, there is a new licence category ‘Multi-contract Packages’ for sales where the consumer has more than one contract, eg, one for the flight and a separate one for the hotel. Flight-Plus sales will move to this category on the licence at the applicable licence renewal.
  • From 1 July 2018 Flight-Plus licensable ‘carried’ passengers from bookings taken prior to 1 July 2018 will need to be reported under Multi-contract Packages until the last departure of those passengers
  • Licensable categories will not need to be amended until the next applicable licence renewal.
  • Licensable revenue Licence Limits will not require a variation to the authorisations to move Flight-Plus sales, which will remain in place until the next applicable licence renewal. 
  • Licensable revenue Licence Limits will need to be varied if an ATOL holder identifies that under the new definition of packages their licensable business has expanded to exceed the sum of currently licenced packages and Flight-Plus sales.
  • The first quarter reporting period affected will be the March 2019 ATOL renewal.   

More information is included in this newsletter which the CAA circulated to ATOL holders and other industry stakeholders on 8 June 2018.

The ICAEW Audit and Assurance Faculty is considering the implications of these changes with a view to updating the ICAEW Technical Release TECH09/16AAF – Revised Arrangements for ATOL Reporting Accountants Reporting to the Civil Aviation Authority.

ATOL Online – the new CAA portal

ATOL holders currently submit applications to renew and vary their licence using paper application forms. The CAA has been working to develop an online portal to enable easier access to ATOL services. ATOL Online will ultimately enable all applications and maintenance of records (including submission of APC returns) to be accessed online and will provide a real-time update of the status of applications. 

The new ATOL Online system was piloted with a selection of ATOL holders early in 2018. The system is now being rolled out to all ATOL holders who will need to apply using ATOL Online at their next renewal. The licensing criteria remains unchanged.

ATOL Online will also be used by ATOL Reporting Accountants (ARAs) to provide the Annual Accountant’s Reports (AARs) to support renewal applications. Existing accountants designated as ARAs will be automatically set up with a CAA portal account and this will enable them to be associated with any number of ATOL holders.

The system will be set up to record that an ATOL holder used a particular ARA for their last application. The ARA will then be able to access submitted AARs. These relationships will continue in the system until an ATOL holder advises otherwise or until the CAA is informed by the professional accounting body that the accountant ceases to be a designated ARA. ATOL holders (including those renewing for the first time) will be able to deselect/select an ARA at any time by logging into the portal.

Updated ATOL online training module

The CAA is reviewing and refreshing the ATOL online training module to include the changes to the PTD. Once this update is in place the CAA will contact all ARAs to ask them to retake the online ATOL training and test as part of their continuing designation. The test will include mandatory questions on the PTD.

ATOL whole-firm compliance review checklist available

We have published a helpsheet providing a checklist of matters firms need to consider when conducting an annual compliance review in accordance with the ICAEW Licensed Practice Handbook.

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