An insolvency fund that could have been used to pay those who had their holidays cancelled by Fantasy Tours was enacted in 1999 but never brought into force, Times of Malta has learnt.

The fund, which tourism operators were meant to contribute towards, would have compensated any traveller, licensed tourism operation or tourist for any debt arising from the insolvency of any licensed tourism operator.

The setting up of the fund came through the Malta Travel and Tourism Service Act, which was enacted in 1999.

However, the related subsections were never brought into force, according to the Consumer Association, which has now written to Tourism Minister Karmenu Vella urging him to set it up as soon as possible.

However, this would provide very little respite to those who saw almost €400,000 worth of paid-up holidays cancelled at the last minute by Fantasy Tours because no law could be applied retroactively, legal sources said.

Yesterday about 138 clients filed a judicial letter in court, giving the travel agent three days to refund the money they paid for the holidays that never happened.

Local consumers were supposed to have a compensation scheme

The letter, a copy of which was also sent to the Malta Financial and Services Authority and the Malta Tourism Authority, was filed against Fantasy Tours Limited and Golden Travel Club Limited, Karl Azzopardi and his mother, both directors and shareholders and Mr Azzopardi’s wife.

The company axed its tours via SMS on August 8, just hours after urging those who had booked holidays to pay in advance for their excursions.

The police say more than 250 official complaints against the travel agency have been received and the losses amount to €374,058.

“According to our legislation, local consumers were supposed to have a compensation scheme but this does not exist because successive governments, since 1999, did not bring two important sections of this legislation into force,” a Consumer Association spokesman said.

Asked whether the Tourism Ministry was addressing the matter by seeing that the two sections would be brought into force, a spokesman said that it was.

Successive governments did not bring two sections of this legislation into force

The spokesman said the ministry, along with the MTA, were “looking into this matter” within the context of a new EU directive on package travel that was being drafted.

The Consumer Association has also written to the MTA chairman requesting an explanation of why Fantasy Tours had its licence renewed when there were reports that it was not honouring Consumer Claims Tribunal decisions.

It also asked for an explanation about media reports that the travel agency had fallen behind on paying its annual licence fees over the past three years.

The MTA had already admitted that, despite not paying its fees, the travel agency, which many creditors are chasing the money they paid for non-existent holidays, still had its licence renewed.

It confirmed that the licence renewal was automatic and happened as soon as an invoice for the payment of the licence fees due was issued, even if the fees remained unpaid.

Sources said the amount due for pending licences was in the region of €4,000.