COVID-19 Article 11 of Act No. 2020-290

Below is a text that has been translated from the original found at this link. This text outlines the conditions and responsibilities of companies like ours as it relates to the cancelation or postponement of bookings in response to the COVID-19 pandemic. For full details on our standard cancelation policy and cancelations under COVID-19, click here.

Mr. President of the Republic,

This Order is issued pursuant to Article 11 of Act No. 2020-290 of 23 March 2020 on emergency measures to deal with the covid-19 epidemic.
Article 11 of this Act authorizes the Government, under the conditions laid down in Article 38 of the Constitution, to take by ordinance, within three months of the publication of this Act, any measure to deal with the economic, financial and social consequences of the spread of covid-19 and in particular to prevent and limit the cessation of activity of natural and legal persons engaged in economic activity and associations and its impact on employment.

In this context, the measure provided for in c empowers it to modify: “with due respect for reciprocal rights, the obligations of legal persons governed by private law exercising an economic activity with regard to their customers and suppliers and of cooperatives with regard to their member-cooperators, in particular in terms of payment deadlines and penalties and the nature of the consideration, in particular with regard to the contracts for the sale of travel and accommodation mentioned in II and III of Article L.”. 211-14 of the Tourism Code taking effect as of 1 March 2020 and services relating to educational stays for minors organized within the framework of Article L. 227-4 of the Social Action and Family Code;”.

In the exceptional context of the spread of covid-19, many States, including France, have adopted measures restricting travel, leading many travelers to request cancellations and refunds from travel agencies. In addition, certain services are canceled by the decision of the service provider. At the same time, these operators are experiencing a drastic drop in orders. As a result, there is a high risk of cash flow pressure on these operators and subsequent default. Currently, more than 7,100 travel and holiday operators registered in France are in great difficulty, faced with a volume of cancellations on an unprecedented scale and almost zero new orders. This is more than just the French market since many European Union member states are reporting the same concerns to the European Commission. To this end, in view of the extent of the economic risk at the European level, the European Commission published guidelines on 19 March last, opening up the possibility of offering the customer a credit note.

Similar difficulties have been identified with regard to travel services that professionals produce themselves as well as for educational stays for minors organized within the framework of Article L. 227-4 of the Social Action and Family Code.

This Ordinance modifies the obligations of professionals to enable them to offer their customers, for a strictly determined and limited period of time, a refund in the form of an identical or equivalent service, or by means of a credit note valid over a long period of eighteen months, with the aim of balancing support for companies in the sector in this period of crisis with respect for consumer law. This method of repayment makes it possible to safeguard operators’ cash flow. The details of this scheme were defined after discussions with the European Commission, the main professional organizations and consumer associations.

Article 1 specifies the scope of application in Section I. These new arrangements will apply to contract resolutions notified either by the customer or by the professional or association after 1 March and before 15 September 2020 inclusive.

The same article identifies the contracts concerned:
1° Contracts for the sale of travel and holidays, the terms and conditions of which are currently governed by Article L. 211-14 of the French Tourism Code, transposed from Directive (EU) 2015/2302 of the European Parliament and of the Council of 25 November 2015 on package travel and related travel services;
2° Contracts relating to the travel services defined respectively in 2°, 3° and 4° of I of Article L. 211-2 of the Tourism Code, sold by professionals producing them themselves. These are, for example:

– accommodation ;
– car rental;
– any other tourist service that is not an integral part of a travel service.

It does not apply to the sale of tickets otherwise regulated by international law and European Union legislation on passenger rights;
3° Contracts relating to the services mentioned in 2° above sold by associations, in particular those organizing on the national territory collective reception of minors of an educational nature mentioned in 1° of Article L. 227-4 of the Social Action and Family Code, which themselves produce these services.
The II lays down the principle according to which, as an exception to the provisions in force, the professional or association may offer a credit note instead of reimbursement of all payments made. In the case of contracts for the sale of travel and holidays, this derogates from the right to the specific reimbursement provided for in Article L. 211-14 of the Tourism Code. In the case of service travel contracts that professionals or associations produce themselves, this is an exception to the right to reimbursement resulting from the combined provisions of Articles 1218 and 1229 of the Civil Code.

The provisions of III of Article 1 of the Ordinance stipulate that the amount of the credit note is equal to the amount of all payments made under the canceled contract. When this credit note is offered, the customer may not request reimbursement of these payments during the period of validity of the credit note (which is eighteen months, see below).
They also stipulate that the professional or association offering a credit note to the client shall inform the client thereof on a durable medium (mail or e-mail) no later than thirty days after the contract is terminated, or, if the contract was terminated before the date of entry into force of this Order, no later than thirty days after that date of entry into force. This information shall specify the amount of the credit note, as well as the terms and conditions of the period and period of validity.

These provisions specify that Article L. 211-18 of the Tourism Code relating to the guarantee is applicable to the credit and the service offered following the cancellation of a contract for the sale of travel and stays.

The IV requires the professional or association to offer a new service so that their client can use the credit note.

This service is the subject of a contract meeting strictly defined conditions:
1° The service is identical or equivalent to the service provided for in the contract resolved;
2° Its price is not higher than the price of the service provided for in the terminated contract;
3° It does not give rise to any price increase other than that provided for, where applicable, by the terminated contract.
This proposal shall be formulated at the latest within a period of three months from the notification of termination and shall remain valid for eighteen months (V).
The VI specifies that, when the price of the new service proposed differs from the service provided for in the terminated contract, the price to be paid for this new service shall take into account the credit note. In concrete terms, this translates into :

– in the case of a service of higher quality and price: the payment by the customer of an additional sum;
– in the event of a different service for an amount less than the amount of the credit note: the conservation of the balance of this credit note, remaining usable according to the terms and conditions provided for by the order, until the end of the period of validity of the credit note (divisible nature of the credit note).

If the contract relating to the new service (for which the client has a credit note) is not concluded before the end of the eighteen-month period of validity, the professional or association shall, pursuant to Article VII, reimburse the client, i.e. all payments made under the canceled contract or, where applicable, the balance of the remaining credit note.
This is the purpose of the present Order which we have the honor to submit for your approval.
Please accept, Mr. President, the assurance of our deep respect.

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