Regulations Relating to Travel Guarantee and the foundation the Travel Guarantee Fund ("the Regulations")
Established by the Ministry of Children and Equality on January 3, 2007, pursuant to Act no. 57 of August 25, 1995 relating to Package Tours and Travel Guarantee ("the Package Tours Act" or "the Act"), Section 10-4, Section 10-6 and Section 11-6.
Section 1. Purpose and Organization of the Travel Guarantee Fund
The purpose of the Travel Guarantee Fund is to administer the travel guarantee system according to Act no. 57 of 25 August 1995 relating to package tours ("The Package Tours Act"). The Travel Guarantee Fund shall also collect fees for the funding of the Disputes Resolution Committee for the dealing with disputes under the Act.
The Travel Guarantee Fund is organized as a private foundation pursuant to Act no. 59 of June 15, 2001 of Foundations; cf. The Package Tours Act, Section 11-2, second subsection.
Section 2. Travel Guarantee Fund Capital
The capital stock of the Travel Guarantee Fund is NOK 100,000. The total assets of the Fund constitute of the contributions paid to the Fund in accordance with the Regulations.
Section 3. The Board of the Travel Guarantee Fund
The Travel Guarantee Fund shall have a Board of Directors consisting of three board members. The Ministry of Children and Equality shall appoint the Chairman of the Board of Directors, who shall have the professional standing of a judge, one member to the Board of Directors and its deputy. The Federation of Norwegian Commercial and Service Enterprises shall appoint one member to the Board of Directors and its deputy. The board members and their deputies shall serve for four years, with the possibility of being reappointed.
Section 4. Guarantee obligation
Guarantee obligations are placed upon:
organizer; by an organizer is meant the person who arranges package tours, cf. Section 2-1 of the Act, and who offers or sells these either directly or through a retailer. Said person is not considered to be an organizer when such activity is only performed occasionally and does not form a regular part of the business. The organizer is also obliged to provide guarantee for transportation that takes place together with a package tour, provided that the transportation is mainly for the customer’s personal use.
intermediary of package tours on behalf of foreign organizer unless it is evidenced that the organizer self has provided guarantee. By intermediary is considered the one who offers or sells package tours that are arranged by an organizer.
the one who sells separate transportation and accommodation services that together bear a substantial resemblance to a package tour, provided that the travel is for the customer’s personal use.
Section 5. Providing of Guarantee - the Individual Guarantee
The one obliged to provide guarantee pursuant to Section 4 shall provide individual guarantee in favor of the Travel Guarantee Fund. Such guarantee shall be provided through a bank or through an insurance company. The Board of the Travel Guarantee Fund may accept another satisfactory security.
For enterprise who arranges, offers or sells travels exclusively for destinations in Norway, the guarantee shall be NOK 50,000.
For enterprise that arranges, offers or sells travels with destinations outside Norway, the guarantee shall be based on turnover for the sale of such travels, based on:
the average budgeted turnover for three consecutive calendar months, the second month of which shows the highest budgeted travel activity for the next year, or,
if the budget for the three months shows numbers that are lower than the last actual accounts for the corresponding three peak season months, the actual account numbers shall be used as the basis, unless the Board determines that the budgeted turnover should form the basis, or
if the budget for next year for the month with the highest turnover, or if the actual accounts for the corresponding month for last year, is NOK 10,000,000 or more, this number shall form the basis for the calculation according to subsection five.
The turnover as mentioned in the preceding subsection forms the turnover subject to guarantee. The size of the guarantee according to the previous subsection alternative a) and b) is determined according to the following scale:
The turnover subject to guarantee below NOK 250,000,
100 % of the turnover subject to guarantee between NOK 250,000 and NOK 2,000,000
75 % of the turnover subject to guarantee between NOK 2,000,000 and NOK 5,000,000, and plus
50 % of the turnover subject to guarantee between NOK 5,000,000 and NOK 10,000,000.
For those with a turnover subject to guarantee as mentioned in third subsection alternative c, the size of the guarantee is determined according to the following formula:
X · (N / 30) + (M – N) / 30 · A · D + X · 0.25.
The parameters of the formula are determined in the following way:
X = budgeted turnover subject to guarantee for the peak month next year, or the actual turnover for the corresponding month last accounting year if the latter is higher,
N = average number of days elapsed between the date of the final payment and departure,
M = average number of days between advance payment and departure,
A = budgeted number of travellers under guarantee obligations for the months having the highest turnover subject to guarantee, and
D = advance payment by each travellers at the time of ordering.
Enterprises, who arrange, offer or sell travels both for destination in and outside Norway, shall only provide guarantees according to subsections four or five above. If only a minor portion of the turnover subject to guarantee relates to destinations outside Norway, the Board may on application from the one subject to guarantee decide that the guarantee shall be provided according to subsection two above, or that the basis for calculation shall be determined by a split turnover between travels with destinations in and outside Norway.
Section 6. Payment to the Fund – Annual Fee
The one subject to guarantee pursuant to Section 4 shall pay an annual fee to the Travel Guarantee Fund. Fees shall partly cover the expenses of The Travel Guarantee Fund to administer the travel guarantee system, and partly to maintain the equity of the Travel Guarantee Fund.
Enterprises that provide guarantee to The Travel Guarantee Fund are divided into the following four fee categories:
Fee category 1: Enterprises who provide guarantee up to NOK 250.000
Fee category 2: Enterprises who have turnover subject to guarantee between NOK 250.000 and up to and including NOK 1.000.000
Fee category 3: Enterprises who have turnover subject to guarantee between NOK 1.000.000 and up to and including NOK 100.000.000
Fee category 4: Enterprises who have turnover subject to guarantee in excess of NOK 100.000.00
For 2010 the annual fee shall be:
For enterprises in Fee category 1: NOK 3.500
For enterprises in Fee category 2: NOK 7.000
For enterprises in Fee category 3: NOK 17.500
For enterprises in Fee category 4: NOK 70.000
If nothing else shall be determined, the rates for 2010 shall apply. In subsequent years of operations, the Board of Directors of the Travel Guarantee Fund may propose other rates in order to maintain its equity at a level of NOK 15.000.000 in excess of what is needed for the administration of the Fund. Any such proposals shall be submitted to the Ministry before the Travel Guarantee Fund can collect the changed fee.
The first payment of the fee shall take place at the time of the providing of the guarantee, and later on by every December 1 for the following operational years.
Section 7. Fee for the Funding of the Disputes Resolution Committee
Enterprise that provides guarantee in favor of the Travel Guarantee Fund shall pay a fee for the funding of the operations of the Disputes Resolution Committee established for the dealing with disputes under the Package Tours Act, cf. the Act, section 10-4, second subsection. The fee shall be collected by the Travel Guarantee Fund.
Enterprises that provide guarantee to the Travel Guarantee Fund are divided into the following four fee categories:
Category 1: Enterprises who provide guarantee up to NOK 250,000
Category 2: Enterprises who have turnover subject to guarantee between NOK 250,000 and NOK 10,000,000
Category 3: Enterprises who have turnover subject to guarantee between NOK 10,000,000 and NOK 40,000,000
Category 4: Enterprises who have turnover subject to guarantee in excess of NOK 40,000,000
Ferry carriers shall be classified in Category 2, unless they qualify for Category 1.
For the first operational year of the Disputes Resolution Committee the annual fee shall be:
Enterprises in Category 1: NOK 1,500
Enterprises in Category 2: NOK 4,000
Enterprises in Category 3: NOK 20,000
Enterprises in Category 4: NOK 75,000
In subsequent years of operations, the Supervisory Board of the Disputes Resolution Committee shall make a proposal for a budget for the operations of the Committee and for applicable fees. The proposals shall be submitted to the Ministry by October 1 each year, and must be approved by the Ministry before the Travel Guatantee Fund can collect the fee.
In addition to fee referred to in subsection three, enterprises shall pay a fee of NOK 1,000 for each case which they wholly or partly have lost in the Disputes Resolution Committee since last payment according to subsection six.
Payment of fee to the Travel Guarantee Fund according to this provision shall take place first time upon the Ministry’s approval of the by-laws of the Disputes Resolution Committee, and later on by December 1 of the following operational year. For new members to the Travel Guarantee Fund, payment shall be made at the same time of the providing of the guarantee. The Supervisory Board of the Disputes Resolution Committee may decide that enterprise that leaves the Travel Guarantee Fund shall pay fee according to subsection five.
Section 8. Exemptions from the Guarantee Obligation
The Board of the Travel Guarantee Fund may after an individual evaluation grant exemption from the guarantee obligation, or determine a lower guarantee amount than what follows from Sections 5 and 6, if it is considered that the travelers are adequately secured in other ways.
If the activity within one and the same calendar year fluctuates considerably, the Board may upon application reduce or waive the individual guarantee for the time periods in which the activities are reduced or non-existing.
Section 9. Determination of a higher Guarantee
If there for any enterprise is a risk of loss to the Travel Guarantee Fund that is not covered by the individual guarantee, the Board og Directors may determine a higher guarantee than what follows from Section 5, subsection two, four and five. This also applies in case a considerable increase in the turnover in the calender year. The organizer is obligated, both unasked and on demand, to provide the Fund with all the information necessary to determine whether the guarantee should be increased. Any violation of these disclosure obligations may result in representatives of the enterprise, including but not limited to the management and board of directors, being held personal liable for any losses suffered by the Travel Guarantee Fubd due to the guarantee obligations being determined too low based on wrong or insufficient information. The same applies if the enterprise has insufficient administration procedures in place to deal with its disclosure obligations.
Section 10. Changes in the Basis for Calculation
The Board of the Travel Guarantee Fund shall continuously evaluate the basis for the calculating of guarantees and fees, and shall by October 31 every year report to the Ministry in writing whether there is a need for any subject changes.
If extraordinary circumstances dictate a change in the basis for the calculation of guarantees and fees, the Board shall immediately inform the Ministry of Children and Equality correspondingly.
Section 11. Submission of Information - Control of Guarantees
By December 1 of the year preceding the budget year, the one being obliged to provide guarantee shall, unless the Travel Guarantee Fund in the individual case decides otherwise, submit a personal statement of the budgeted turnover. This statement shall be accompanied by audited accounts for the three months of the previous year as stated in Section 5, subsection three, paragraph b). If this documentation has not been received by the Board by March 1 of the budget year, the provided guarantee is considered insufficient and operations must terminate. In individual cases, the Board may extend the deadline by up to four weeks.
The Board shall implement a system to ensure that each individual guarantee according to Section 5 and payment according to Section 6 are in compliance with the Package Tours Act and the provisions of the Regulations.
Section 12. Duty of Disclosure in Advertisements and similar
Organizers are in advertisements, sales brochures etc. obligated to disclose that guarantee is provided according to the Package Tours Act and the Regulations.
The Travel Guarantee Fund shall supervise that the duty of disclosure is complied with.
Section 13. Recourse of the Travel Guarantee Fund
For payments made by the Travel Guarantee Fund, the Fund may take recourse against the one who caused the payment.
The Board of the Travel Guarantee Fund may decide to waive any recourse, wholly or partly.
Section 14. Loss of right to arrange package tours
The right to arrange, offer or sell travels as referred to in Section 4 cease one month prior to the expiry of the individual guarantee, unless the Board of the Travel Guarantee Fund decides otherwise for the remaining time of the guarantee.
Section 15. Borrowing
The Board of the Travel Guarantee Fund may borrow to fund claims in excess of its total assets and the guarantee of the individual organizer.
Section 16. Management
The Board of the Travel Guarantee Fund may contract the assistance deemed necessary to administer the package tour system. The Board establishes the detailed instructions for such work.
Section 17. Additional Rules
The Board of the Travel Guarantee Fund establishes within the scope of the Regulations the detailed instructions for the travel guarantee system, including detailed instructions for verification of received information.
Section 18. Penalties
Violation of the provisions of the Regulations is punishable under the Package Tours Act, Section 11-7.
Section 19. Coming into Force
The Regulations come into force immediately.