In December 2025, the EU Council and Parliament reached a political agreement on the most significant reform to the Package Travel Directive since its 2015 adoption. For operations teams managing supplier networks across Europe, the changes are not cosmetic. They rewrite the financial and legal rules your contracts are built on.
The problem
The current Package Travel Directive (Directive (EU) 2015/2302) has been in force since 2018. It established organiser liability, insolvency protection requirements, and information duties for packaged travel. But enforcement has been uneven across member states, and the directive did not anticipate the scale of operator collapses seen between 2019 and 2025.
The European Commission proposed a reform in November 2023, citing consumer losses from the Thomas Cook (2019) and FTI Touristik (2024) insolvencies. The political agreement reached in December 2025 between the Council and Parliament sets the framework that member states must transpose into national law.
The 25% prepayment cap
Under the reform, organisers will be limited to collecting no more than 25% of the total package price as a prepayment, unless the organiser can demonstrate that upstream supplier costs require a higher amount. This changes the cash flow dynamics for operators who currently collect full payment at booking. For DMCs receiving prepayments from organisers, expect downstream pressure on payment terms.
Expanded organiser liability
The reform clarifies and expands the organiser's liability for performance failures across the entire supply chain. If a hotel fails to deliver the contracted room category, or a transport provider cancels without adequate notice, the organiser bears the liability to the traveller regardless of the organiser's contractual position with the supplier. This makes supplier vetting and contract management a direct liability issue, not just an operational preference.
The 4% turnover fine ceiling
Member states will be required to establish penalty frameworks for non-compliance, with a proposed ceiling of 4% of the organiser's annual turnover. This mirrors the structure of GDPR penalties and signals the EU's intent to make enforcement meaningful. The exact penalty structures will vary by member state during transposition.
What to do now
Review every active organiser contract for prepayment terms that may conflict with the 25% cap once transposed. Map your supplier agreements against the expanded liability provisions to identify where a supplier performance failure would leave you exposed. Begin tracking the transposition timeline in each EU member state where you operate. The directive gives member states until approximately late 2028 to transpose, but some will move faster.