The government has approved yet another round of modifications to future regulations about tour operators and travel agencies, taking effect as of 1 July.

Government decree 79 of 2018 has modified several parts of government decree 213 of 1996 and replaced an earlier set of rules included in government decree 473 of 2017.

Most of the current changes affect the current system of security deposits. Travel companies involved in different activities requiring a 12% and a 20% security deposit will have to set aside a deposit amount according to the higher 20% level.

Travel businesses will have to have a compulsory insurance in place for their passengers already at the time of signing the travel contract if the travel package includes transport.

This insurance is scheduled to cover the expenses of extended stays abroad and bringing passengers home if something goes wrong during the trip or the travel agency goes bankrupt.

But it is still not entirely clear how market players should apply these provisions on compulsory insurance in practice, according to legal expert András Salamon. He expects uncertainties may result in a series of legal procedures or lawsuits.

Under a new provision, future rules on compulsory insurance would also apply to those trips already underway as of 1 July. Previous rules only affected those travel contracts signed on or after 1 July. This change is also expected to cause problems to many market players.

Salamon expects further modifications in the future, even to the relatively new government decree 472 of 2017 on travel contracts.

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