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Are you thinking of starting a travel agency? If so, there are several legal considerations to think about before opening your doors. Having your terms and conditions in place from the outset will ensure that you encounter no roadblocks as you grow your business. This article will outline some of the key issues to consider before opening a travel agency.

What Services Are You Providing?

You need to consider which services you will provide and which services you will not.

For example, you might decide that your travel agency will only book flights and accommodation or, alternatively, that you will also offer a service to book tours, events and transfers.

Some travel agencies also offer their own tours. You will need to decide whether you will provide such services. You should think carefully about this decision, as you will face different legal obligations if you act as a tour guide service as well as a booking agent.

In order to manage your clients’ expectations and avoid any disputes, it is important that you are clear on which services you will be able to provide and which services you will not.

When Is Payment Required?

Your clients may wish to book their holidays months in advance. In this case, you will need to decide when payment is required. To ensure that you receive payment, you may wish to require that clients make the full payment upfront. However, this may not be an attractive option for your customers. You will need to carefully balance security with your clients’ convenience. There are several ways to successfully achieve this balance.

For example, you might require that customers pay a 20% deposit upfront, with the balance being payable 30 or 60 days prior to departure. This ensures that you receive some payment upfront but gives clients sufficient time to pay off their bookings.

What Personal Information Are You Collecting?

Under Australian law, you must tell your customers how you will collect, use, disclose and store their personal information. As a travel agent, you will undoubtedly be collecting personal information. For example, you may need to collect:

  • passport information;
  • names;
  • phone numbers;
  • signatures; and
  • bank account details.

Before you open your travel agency, it is important that you have a privacy policy in place setting out how personal information will be collected and stored securely.

Who Is Responsible For Ensuring That Proper Visas Are Obtained?

Depending on the passport holder and the destination, some of your clients will need to obtain visas. As a travel agent, it is generally not your responsibility to ensure that your clients have the necessary visas. If it is the customer’s responsibility to obtain their own visas, you should include a disclaimer in your terms and conditions that clearly states that you will not be responsible for any refused entry into a country.

Will You Provide Any Insurance?

You should think about whether you will offer insurance to your clients. If not, you may wish to require your customers to obtain personal and medical travel insurance from elsewhere. If you require your customers to take out insurance, you should also require them to provide you with a copy.

What Is Your Cancellations Policy?

If your clients book their holidays months in advance, there is a high probability that clients will occasionally wish to cancel or change their booking closer to the date. You should think about how you can draft your cancellations policy in a way that will allow you to minimise your losses and still keep your clients happy.

What Are You Not Liable For?

You must make clear what you will not be liable for. If something goes wrong on a trip, or if a hotel gets a booking wrong, your customers may come back seeking damages or compensation from you. It is extremely important that you are clear on what you will not be liable for. Your disclaimers and limitations of liability should be set out in your terms and conditions.

Setting up a travel agency has many legal implications. It is recommended that you consult with an experienced small business solicitor to ensure that you understand your obligations and the risks involves in starting a travel agency.

Key Takeaways

Starting a new business gives rise to many important legal considerations. If you want to start a travel agency, you should make sure that you have thought about these issues before you open for business. This can help to avoid disputes with clients about payment, services or cancellations. If you need help setting up your travel agency, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on this page.

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