Insider Business Vouchers with €80 million in state guarantees for tourists

Vouchers with €80 million in state guarantees for tourists

The Cabinet approved on Thursday a bill that allows tourist businesses to offer their customers compensation in 18-month vouchers aiming to keep travel agencies and hotels afloat.

The bill covers pre-paid travel bookings that will not materialise due to Coronavirus, with the state guaranteeing payments to beneficiaries if businesses become insolvent.

According to Phileleftheros, this aims to resolve the issue of refunds due because of cancellations, now valued at over €80 million.

“This bill is important for Cyprus’ credibility as a tourist destination,” Finance Minister Constantinos Petrides said on Twitter.

The bill is expected to be put to a vote soon before the House plenum.

As per the bill’s provisions, tourists will be offered a voucher that they will be able to redeem by December 31, 2021. If the voucher is not redeemed by then, the business is obliged to pay back the customer the owed amount by January 31, 2022.

The proposal also stipulates government guarantees of €1.5 million to consumers who made their bookings through travel agents and €5 million guarantees for consumers who made their bookings directly with the tourist accommodation, while they will also cover cancellations for cruise vessels operating under the Cypriot flag.

In addition, the state will issue government guarantees totalling € 80 million in the event that, in the event of a Covid-19 pandemic, a hotel and / or tourist accommodation contract is cancelled.

According to the bill, no government guarantee will be given to a tourism company or hotel business that was unsustainable and faced financial difficulties on December 31, 2019, while the guarantee will not cover advances paid after October 1, 2020.

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