A legal analysis and improvements of force majéure clause in package holiday contracts: between travel agents and holidaymakers / Ahmad Afiq Hasan

Package holiday contract is projected into an uncertain future where even the best laid plans can go awry. Given the intangible nature of package holiday, and its complexity, reliance on the English doctrine of frustration of contract, in some circumstances, could be impracticable and inequitable to both outbound and inbound holidaymakers and travel agents. To secure the economic interest of both parties, industry practice is to pray in aid of the flexibility accorded by force majéure clause in the event of inevitable cancellation of package holiday and variation of terms in package holiday contracts. However, regulated force majéure clause in standard form outbound holiday contracts resulted to unfair circumstances which must be faced by both the outbound holidaymakers and travel agents in many aspects. On the other hand, inbound travel agents freely construct force majéure clause to be too broad to cover many types of events and the resulting consequences of the events are, sometimes, unfair to holidaymakers. By employing qualitative research method, the research analysed the shortcomings of the out-dated Tourism Industry (Tour Operating Business and Travel Agency Business) Regulations 1992, the Consumer Protection Act 1999, the unregulated inbound practices of force majéure clause and the proactive approaches adopted by the European Union member states, the United States, the United Kingdom, Australia, Canada, New Zealand and Hong Kong. The primary objective of the research is to propose an improved framework on the application of force majéure clause in holiday package contracts in view of the legal complications of the regulated outbound package holiday contracts and the unregulated inbound package holiday contracts. Based on the theory of good faith, the proposed framework for force majéure clause provides greater consumer protection of holidaymakers while securing sustainable travel agency business in Malaysia.