Who or what is Lowcostholidays?

The company was set up in the UK in 2004 with an Irish division opened in 2010. Its big promise was cheap deals for holiday makers and the operation had a couple of strands – it ran a bed bank which saw it buy rooms from hotels and other providers in bulk and them sell them on to both travel agents and the public. It also operated a more traditional travel agent service and sold discount package holidays.

It’s gone now, right?

Yes. It closed on Friday evening. The administrations blamed a number of factors on its demise including Brexit. In a statement they suggested uncertainty in the run-up to the vote saw some customers delay booking holidays while sterling’s collapses after the fact made things worse.

How big a deal is it?

It is a pretty big deal. While the company’s business is mainly in the UK, it has an annual turnover in the Republic of around €50m and around 15,000 people are likely to be directly impacted by its closure.

How will they be impacted?

Well, it depends on the nature of the consumer's relationship with the company. Anyone who booked a package with lowcostholidays.ie and has yet to travel will most likely have to rethink their holiday plans. While confirmed airline tickets will remain valid as it has been paid for upfront by the company accommodation will not as the accommodation providers in most cases will not yet have been paid.

Consumers who have booked packages will, as a result, have a number of decisions to make. They could use the airline tickets too fly to their destination and stay in the hotel already booked. They could then pay directly for their accommodation (a second time) and then seek that money back from the Commission for Aviation Regulation (CAR). Alternatively, they could cancel the whole package and look to get the money back from the CAR.

Why is CAR involved?

Because online travel agencies operating in Ireland have to comply with the Package Holidays and Travel Trade Act 1995 and must be registered with the CAR. They also have to place a cash bond with the regulator to cover the costs of consumers in the event a travel agent goes to the wall.

All consumers are protected, so at least that’s something, right?

Well, no. Not all consumers have the same level of protection. Anyone who booked a complete package through the website will be able to get redress but those who booked accommodation only are not covered.

Oh, right. So what do they need to do?

Well, if something has been paid for using a credit or debit card and it is not delivered then consumers should immediately contact their bank and get it to start a process known as a chargeback.

Effectively this means you notify your credit card provider to refund money paid directly to lowcostholidays directly back onto your card. Time limits do apply and consumers typically have 120 days from the time that they become aware of the problem to apply for a refund.

How long should the chargeback process take?

It depends on the bank, the credit card provider and the reason for the chargeback. Given that this situation is so high profile and impacts so many people it is pretty open and shut so there should not be much toing and froing between customers and their banks.

But I am already overseas and in my accommodation?

Well, most likely you have already – or will soon be – asked to pay for the cost again. In that case you have little option but to do that and then start the chargeback process.