SINGAPORE - To protect consumers from errant travel agencies, include those which close down abruptly, the Government is proposing a number of changes to the Travel Agents Act and Regulations.
Under the recommendations, those found guilty of carrying out unlicensed travel agent activities will be fined a maximum of $25,000, up from $10,000, while the maximum composition fine will be raised to $5,000 or half the maximum fine prescribed, whichever is lower.
The plan is also to give the Singapore Tourism Board (STB) more investigative powers, such as taking photographs, audio and video recordings that may serve as evidence for wrongdoing.
It may also soon be mandatory for travel agents to inform travellers about travel insurance options and keep a record of this. In 2015, a licensing condition was implemented that required travel firms to remind travellers to buy insurance coverage to guard against cases where the firms go bust after they have sold tour packages.
Travel agents will also no longer have the option to provide a banker's guarantee in place of meeting a $100,000 net worth requirement to be a licensed travel agent.
The Ministry of Trade and Industry, which issued a statement on the proposed amendments on Wednesday, said that the banker's guarantee does not provide assurance that the travel agent is financially sustainable, and does not provide any direct recourse in the event that the agency goes bust.
Senior Minister of State for Trade and Industry Ms Sim Ann said: "The majority of our travel agents are professional and conduct their businesses responsibly.
"But as the travel industry transforms and consumer expectations evolve, we need to update the regulatory framework to safeguard the interests of consumers and also ensure that the business environment allows travel agents to innovate and grow."
In the first five months of the year, Case received 195 complaints involving the travel industry.
Just last month (May 31), Misa Travel shut down abruptly after the STB revoked its travel agent licence for failing to "fulfil its obligations towards its customers". Customers were out of pocket by $28,000 for packages that had not been fulfilled.
Other than strengthening the authorities' hand to deal with errant companies, the proposed amendments are also meant to encourage innovation and reduce costs for players in the industry.
For instance, MTI is proposing a new restricted travel agent licence with a lower requirement of $50,000 in paid-up capital, for agents who sell local tours that include transport, but come without accommodation.
Companies offering tours within Singapore without "passenger-carrying conveyance" such as those offering walking or cycling tours will no longer need a travel agent licence.
Some businesses, such as home-based ones or those in shared premises may also be exempt from the requirement to display signs.
The proposed amendments are a result of 17 discussion sessions with more than 180 participants from the travel industry, such as travel agencies, the National Association of Travel Agents Singapore (Natas) and the Consumer Association of Singapore (Case).
The public consultation period starts June 21 and ends on July 12.