The EU Package Travel Directive is no longer really about package holidays. It is increasingly about who controls the customer journey

The European travel market has changed dramatically over the past two decades. Travellers, equipped with social media suggestions, AI tools to optimize itineraries, are increasingly building their own trips online, moving seamlessly between booking platforms, airlines, accommodation providers and other travel services. Yet EU travel regulation was originally designed for a much simpler world, where holidays were typically sold as pre-arranged packages by travel agents.

One of the central challenges for regulators has therefore become deceptively simple: when does a combination of travel services become a package holiday? The answer matters because package status triggers extensive rights and obligations, including organiser liability, insolvency protection, cancellation rights and refund obligations.

Directive (EU) 2015/2302 intended to modernise the rules by extending protection to a wider range of booking models and introducing the concept of linked travel arrangements. However, experience over the past several years, combined with the disruption caused by the COVID-19 pandemic and major travel company insolvencies, revealed weaknesses in the framework.

Directive (EU) 2026/1024[1] represents the EU's latest attempt to address those challenges. While much attention has focused on vouchers, refunds and insolvency protection, the broader significance of the reform lies elsewhere. It reflects a continuing regulatory trend towards addressing the realities of digital booking journeys and clarifying where legal responsibility should sit in an increasingly platform-driven travel market.

To pack(age) or not to pack(age)

The classification of a travel product is far more than a technical legal exercise. It determines whether a traveller benefits from the extensive protections available under the Package Travel Directive and whether a business assumes the role, obligations and liabilities of a package organiser. As travel booking has increasingly shifted online, answering this question has become significantly more complex. Rather than purchasing a single pre-arranged holiday, travellers now often assemble their journeys through a series of interconnected transactions completed across multiple platforms.

Where a package exists, a package organiser becomes the single entity responsible for the traveller's overall experience. The organiser must provide the prescribed pre-contractual information, conclude the package travel contract, manage cancellations and refunds, maintain insolvency protection and assist travellers when problems arise during the trip. Most importantly, the organiser is liable for the proper performance of all travel services included in the package, regardless of whether those services are delivered directly by the organiser or by third-party suppliers such as airlines, hotels or excursion providers.

The rise of online travel agencies, digital platforms and increasingly sophisticated booking journeys has blurred the distinction between packages[2], linked travel arrangements[3]and stand-alone travel services[4]. The growth in cross-offering of services on platforms that traditionally sold only one service, e.g. airline websites bundling hotels and car rental services into one package, makes the situation even more complicated. In practice, relatively minor variations in website design, booking architecture, payment processes or data-sharing mechanisms could determine whether a traveller received the full protection of the Directive or only a much more limited set of safeguards.

From a policy perspective, this increasingly appeared difficult to justify. Travellers generally perceived their holidays as a single purchase and expected a corresponding level of protection. Yet the legal classification of that purchase often depended on technical features of the booking process that were largely invisible to consumers. As digital distribution models evolved, regulators became increasingly concerned that legal protection should depend less on the formal structure of the booking journey and more on the commercial reality experienced by travellers.

The OTA dilemma

Online travel agencies (OTAs) sit at the centre of many of these debates. Their business model is built around helping travellers combine services from multiple suppliers through a single booking journey.

Traditionally, OTAs have often viewed themselves primarily as intermediaries connecting consumers with airlines, hotels, car rental providers and other travel businesses. However, as booking journeys become increasingly integrated, the distinction between facilitating a transaction and taking responsibility for it becomes less clear .

A traveller is generally not concerned about how many suppliers are involved behind the scenes. What they see is one website, one booking process and one travel experience. The legal analysis is, of course, more complex. Nevertheless, the regulatory trajectory appears clear. Regulators are increasingly interested in how a product is presented to the customer, not only in how the underlying contractual arrangements are structured.

For OTAs, this means that regulatory exposure may increasingly depend on product design decisions rather than purely contractual ones. Cross-selling strategies, click-through journeys, integrated payment processes and personalised recommendations may all become relevant when assessing whether a travel arrangement falls within the package travel regime.

The 2026 reform

It was was against this background that the EU decided to revise the Package Travel Directive. While the 2026 reform is often presented as a response to the COVID-19 pandemic and the difficulties surrounding mass cancellations, refunds and insolvencies, its objectives are considerably broader.

The reform represents an attempt to address the growing disconnect between the way travellers purchase travel services and the way those services are classified under the legal framework. As digital booking journeys became more complex, the existing rules proved increasingly difficult to apply in practice and, in some cases, produced outcomes that appeared arbitrary from a consumer perspective.

The reform therefore seeks not only to strengthen traveller protection, but also to simplify and modernise a framework that had become increasingly difficult to navigate in a digital marketplace. In doing so, it reflects a broader trend across EU consumer regulation: responsibility is gradually shifting towards businesses that shape, facilitate and influence purchasing decisions, rather than remaining limited to those that physically provide individual services.

The same policy direction can be seen in other recent EU legislation. The Digital Services Act[5], for example, imposes graduated obligations on online platforms based on their intermediary role and influence within the digital ecosystem. Similarly, the Omnibus Directive[6] expanded transparency requirements for online marketplaces, recognising that the entity presenting and facilitating a transaction may have a significant impact on consumer decision-making. The travel sector is now experiencing a comparable regulatory shift, with the revised Directive placing greater emphasis on the commercial reality of the booking process and less on technical distinctions that may be invisible to travellers.

The end of linked travel arrangements

Perhaps the most significant structural reform is the removal of linked travel arrangements as a separate regulatory category.

The LTA concept was originally introduced to bridge the gap between package holidays and stand-alone travel services. In practice, however, it generated uncertainty for both consumers and businesses. The distinction often depended on technical details that were difficult for travellers to understand and burdensome for operators to apply correctly.

The 2026 reform abolishes LTAs as a distinct category[7]. At the same time, it clarifies and broadens certain package travel concepts, meaning that some booking journeys which previously fell within the LTA framework may now be treated as packages. The objective is therefore not simply deregulation, but simplification and greater legal certainty.

For travel businesses, this may require a reassessment of existing booking flows and customer journeys, particularly where current models were designed around the assumption that LTA status would apply.

What about vouchers

A longside consumer-facing protections, the reform also addresses the financial relationships that underpin the travel industry. Policymakers sought to strike a balance between protecting travellers and recognising the liquidity constraints faced by organisers and suppliers, particularly during large-scale market disruptions.

The 2026 reform substantially strengthens the protection of travellers who accept vouchers instead of cash refunds. Vouchers may only be issued with the traveller's express consent, unused vouchers must be automatically refunded, and organisers are required to ensure that outstanding voucher obligations are covered by insolvency protection. 

These measures reflect an increasingly visible theme throughout the reform: consumer protection must remain effective, but it should not be achieved through mechanisms that undermine the financial resilience of travel operators themselves.

Insolvency protection

The 2026 reform places greater emphasis on insolvency protection, reflecting lessons learned from both the COVID-19 pandemic and the collapse of major travel companies. Organisers remain required to maintain insolvency protection covering travellers' payments and, where applicable, repatriation. However, the revised rules go further by extending protection to certain outstanding refund claims and unredeemed vouchers. As a result, travellers should be better protected if an organiser becomes insolvent, while travel businesses may face increased scrutiny regarding the adequacy of their guarantee arrangements and financial safeguards.

Don't ignore the complaint

A new procedural obligation requires organisers to acknowledge receipt of traveller complaints within seven days and provide a reasoned response within 60 days.

Although seemingly administrative, the practical implications should not be underestimated. Many operators will need to implement more structured complaint-handling systems, establish internal escalation processes and ensure sufficient recordkeeping to demonstrate compliance with statutory deadlines.

For businesses that historically managed complaints on a more informal basis, the new requirement represents a significant governance and compliance development rather than simply an additional consumer right.

What starts as a booking may end as a regulatory issue 

For travel businesses, the most important aspect of the reform may not be vouchers, insolvency protection or complaint deadlines. Rather, it is the growing emphasis on how travel products are designed, marketed and sold.

The original Directive was largely concerned with traditional package holidays. The 2026 reform is increasingly focused on digital booking journeys. Businesses operating online platforms, dynamic packaging models or multi-provider booking environments should expect greater regulatory scrutiny of how consumers are guided through the purchasing process and how travel products are presented.

This reflects a broader regulatory shift across EU consumer law. Commercial influence and customer experience are becoming increasingly important in determining legal responsibility. Businesses that shape a traveller's purchasing decision may face greater regulatory obligations even where they do not directly perform the underlying travel services.

This regulatory direction is consistent with broader developments in EU law. The Digital Services Act, the AI Act[8] and the revised Consumer Rights Directive all reflect an increased focus on the obligations of entities that mediate or shape consumer decision-making, irrespective of whether they are the ultimate service provider.

A due diligence question hiding in plain sight

The reform also raises interesting questions for investors and acquirers in the travel sector.

Travel businesses are traditionally reviewed through the lens of contracts, licences, regulatory approvals and customer terms. However, the design of the booking journey itself may increasingly become a due diligence topic. A business may have perfectly drafted contracts while its digital customer journey creates package travel obligations that have not been fully recognised.

For buyers, this means that legal due diligence may need to look beyond contractual arrangements and examine how travel services are combined, promoted and sold in practice. Potential exposure may arise not only from what the documentation says, but also from what customers actually experience during the booking process.

In practice, this means that deal teams conducting legal due diligence on travel-sector targets may need to supplement traditional contract and licence reviews with assessments of the target’s digital booking architecture, including UX/UI flows, data-transfer mechanisms between service providers, and the presentation logic applied to cross-sell and upsell offers. A gap analysis measuring the target’s current booking model against the revised package definition may reveal latent compliance exposure that is not apparent from the contractual documentation alone.

What happens when AI becomes the travel agent?

The next challenge may come from AI-driven travel planning[9].

More travellers are beginning to use AI tools to identify destinations, compare travel options and assemble personalised itineraries. As these tools become increasingly integrated into booking processes, new questions are likely to emerge. In certain cases, travellers may also use agentic AI to automatically purchase and make bookings on their behalf when certain conditions are fulfilled (e.g. if a discount is launched). If an AI assistant combines flights, accommodation and other services into a single recommendation, who is responsible for the resulting travel product? Does the technology merely facilitate the booking, or does it play a role similar to a traditional organiser? 

The current reform does not answer these questions directly. However, it may already indicate the regulatory trajectory. The EU AI Act, which classifies AI systems by risk level and imposes obligations on deployers, could interact with travel regulation where AI tools play a substantive role in assembling or recommending travel packages. If recent regulatory developments are any indication, policymakers are likely to pay increasing attention to who shapes the traveller's decision-making process, regardless of whether that influence comes from a human travel agent, an online platform or an AI-powered assistant.

The real regulatory question may no longer be who signs the contracts, but who designs the booking journey. If an AI assistant selects, combines and presents travel services in a way that effectively creates the holiday package, regulators may be less interested in whether the "organiser" is human, digital platform or algorithm, and more interested in identifying the trader behind the system that shaped the traveller's purchasing decision.

The real destination: legal certainty

The evolution of the Package Travel Directive mirrors the evolution of the travel industry itself. What began as legislation designed for traditional package holidays has gradually adapted to a marketplace increasingly dominated by digital platforms, dynamic booking tools and interconnected travel services.

The 2026 reform does more than address lessons learned from COVID-19 or major insolvency events. It represents another step in the EU's effort to align travel regulation with the realities of modern booking behaviour. The abolition of linked travel arrangements, strengthened voucher protections, enhanced insolvency safeguards and new complaint-handling requirements are all part of a broader attempt to reduce legal uncertainty while maintaining a high level of consumer protection.

For travel businesses, investors and advisers, the key message is clear. Compliance will increasingly depend not only on the services being sold, but also on how those services are combined, presented and delivered through digital channels. The legal boundaries between platforms, organisers and service providers continue to evolve, and businesses operating in the travel sector should ensure that their commercial models evolve accordingly.

This change in focus may ultimately be the most important aspect of the reform. The future of travel regulation is unlikely to be defined by traditional travel agencies. Instead, it will increasingly be shaped by digital platforms and the customer journeys they create.
 

[1] Directive (EU) 2026/1024 was formally adopted on 29 April 2026, entered into force on 28 May 2026, and must be transposed by Member States by September 2028. The new rules are therefore likely to start affecting the market in practice from 2028-2029 onwards.

[2] A package exists where at least two different types of travel services (such as transport, accommodation, car rental or, where it accounts for at least 25% of the value of the combination, another tourist service) are combined for the purpose of the same trip or holiday and either (a) sold or offered as a single travel product (Article 3(2)(a) of Directive 2015/2302, as amended), or (b) combined through specified click-through or data-transfer booking arrangements (Article 3(2)(b)). Package status triggers the full protection regime, including organiser liability for performance, cancellation rights and insolvency protection.

[3] A linked travel arrangement exists where a traveller purchases at least two different travel services for the same trip through separate contracts with different providers, and a trader facilitates the purchase of the additional service in a targeted manner, no later than 24 hours after the confirmation of the first booking (Article 3(5) of Directive 2015/2302). LTAs receive more limited protection than packages—principally insolvency protection and pre-contractual information requirements — and, notably, do not trigger organiser liability for the performance of individual travel services. Note that under the 2026 reform, LTAs are abolished; the above description reflects the position under Directive 2015/2302 prior to amendment.

[4] A stand-alone travel service is a single travel service purchased on its own, such as a flight, hotel accommodation or car rental booked independently, without meeting the conditions for a package or an LTA. Such services do not benefit from the specific protection regime of the Package Travel Directive and are instead subject to general consumer protection rules and sector-specific legislation.

[5] Regulation (EU) 2022/2065

[6]  Directive (EU) 2019/2161

[7] According to the European Commission, the LTA category created legal uncertainty and practical difficulties in distinguishing between packages, LTAs and stand-alone travel services, particularly in digital booking environments.

[8] Regulation (EU) 2024/1689

[9] The Package Travel Directive and the 2026 reform do not specifically address AI-based travel assistants. The observations in this section reflect potential future regulatory questions arising from increasingly automated booking journeys.