Airline companies, travel agents compromise in bank guarantee dispute
Airline companies and travel agents on Saturday finally reached a compromise agreement in their dispute over hefty bank guarantees that airline companies demanded from agents in August to insure their business in the country.
In a meeting at the Radisson SAS Hotel, airline companies led by Royal Jordanian, and travel agents, represented by the Jordan Society for Travel and Tourism Agents (JSTTA), agreed that agents would purchase a single insurance policy to cover the financial rights of airlines in the case that travel agents do not make payments on purchased airline tickets.
"The JSTTA presented a settlement that included the purchase of one insurance policy to cover all agencies. The settlement was satisfactory to all parties, and the issue is now resolved," said George Twal, Jordan country director of the International Air Transport Association (IATA).
Bishara Sawalha, JSTTA president, said the agreement on insurance was signed in lieu of the issuance of bank guarantees.
"This agreement will cause a minor increase of 400 fils in individual ticket prices, which won't cause any considerable strain on our customers," Sawalha added.
In early August, airline companies decided unanimously to require bank guarantees equivalent to the value of average sales over a 45-day period for each agent. The airlines said it was necessary to guarantee their financial rights in case of a default in payments by travel agents.
The agencies, led by JSTTA, refused the airlines' request, which agents say would have caused many to go out of business, and demanded that an acceptable compromise be found.
The tourism sector is considered one of the fastest growing sectors in Jordan, with an estimated revenue of more than JD80 million in ticket sales up to August of this year. — ( Jordan Times )
By Yacoub Abu Ghosh
© 2000 Mena Report (www.menareport.com)
- Vehicle shortage threatens tourism during Eid Al-Adha in Jordan
- Airline companies ask IATA travel agents to furnish bank guarantees
- American Express leads the way in travel expense management with launch of Corporate Travel Account
- EQUATE recognizes travel agents and airline companies
- Kanoo Travel to Dominate Latest Saudi Tourist Boon