On October 1, China officially announced a new tourism law, impacting on travel agencies in the country and banning the zero or negative fare tours. This is a very positive step as travel agents can no longer sell tours at or below costs and attract travellers through cheap prices and then during the tour forcing them to purchase goods and provide tips for the travel agents. The new law is also expected to lead to a boom in online travel services in China (Hotelmarketing 2013).
IMPACT ON TRAVEL AGENCIES
The impact of the new law is highly visible to travel agents in China. Less people are booking tours than in the previous years, causing dissatisfaction of travel agents. Package tours are an essential part of travel agencies' profits and after package tour prices having increased dramatically, due to the previously hidden costs being added, less travellers have booked a package tour. To show the impact of the law, a package tour to Thailand is now priced at 6,800 yuan from previously being priced at 3,800 yuan. This price almost doubled and revealed the dramatic impact of tips and real pricing for the tours. With these significantly higher prices, less travellers can afford the package tours now, leading to less bookings.
However, there is also good news, as travel agencies are working on pricing package tours correctly, including all tips and prices for services. This ensures that the package price paid by travellers actually contains all costs and there are no more hidden costs to pay once the tour is starting.
LAW ADDRESSES PROBLEMS
China’s new tourism law also addresses other issues such as unfair competition, price hikes and also limiting congestion in scenic spots in the country. This is an essential step also with regards to keeping travellers in the country happy. Another very interesting addition provided by the law is that traveller’s rights are also mentioned in terms of giving them the right to “know, choose, receive aid and be respected during their travels” but the law is also advising travellers to behave when travelling.
This is a move that is long overdue, ensuring that travellers’ rights are protected and the tourism industry as a whole can further develop. China’s authority is aiming to build the tourism sector into a pillar industry, having undergone dramatic changes in the past already.
FIRST TOURISM LAW
This first tourism law will ensure that illegal practices amongst travel agencies and other stakeholders in the tourism industry will be eliminated which gives more room for other companies to develop and grow. With prices being increased by travel agents, now displaying all previously hidden costs, online travel is also expected to boom as prices are better comparable and travellers have the choice to either book travel through a traditional travel agent or online. China’s tourism law can be considered a first step towards helping the country’s tourism industry which will hopefully lead to growth and other changes to the tourism sector.
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