Tui Travel GC: Travel tales
6 January 2014 | By Joanne Harris
Tui Travel legal boss Mike Bowers rarely has time to relax with his company trailblazing in digital services and one-of-a-kind holidays, and a new EU travel directive in the wind
The first time Mike Bowers worked in the travel industry was before he became a lawyer. The young Bowers spent time as a holiday rep for Thomson Holidays, travelling around the Mediterranean doing his best to keep holidaymakers happy as he saved up for law school.
By chance, when Bowers graduated he found a training contract at specialist travel law boutique Mason Bond, now MB Law. His first in-house job was at charter airline Airtours, where he was part of a legal team seeing the business through significant growth and restructuring. In 2006 Bowers joined First Choice Holidays as general counsel and, when that company merged with German outfit Tui in 2007, Bowers took the role of mainstream tour operating general counsel.
Bowers’ journey through the holiday industry most recently saw him land the position of group legal director for Tui Travel. He has replaced Andrew John, who is now director of the company’s secretariat and responsible for health, safety and risk as well as compliance.
Bowers’ role involves heading a global legal team of about 100 lawyers, including a team based in the company’s Crawley head office, lawyers in the jurisdictions where Tui’s customers are to be found, and a 35-strong UK group handling customer claims. Bowers’ remit covers not only general legal issues, but also political affairs – something he has looked after for some time.
The EU is looking closely at air passengers’ rights, proposing amendments to legislation as well as a new Package Travel Directive. Bowers is leading Tui’s efforts to influence and inform policymakers in Europe and the UK.
“The environment will become more regulated, in the sense that providers of arrangements that are not currently considered package holidays will be brought into the scope of the directive,” he explains. “We think that’s a good thing because, on the whole, whether a customer’s buying a pre-packaged holiday or something someone facilitates at the point of booking, they face the same risks. If you look at it from an industry perspective, players competing in the same market should be treated the same way.”
Bowers says Tui tries to work with stakeholders and policymakers rather than confront them over issues.
“What do politicians principally care about?” he asks. “They care about voters, and therefore customers. They care about growth and jobs. If we can talk in those terms about what’s good for growth and jobs, and what’s good for customers, people start to listen.”
Sunny never sleeps
Luckily for Bowers, Tui has been reasonably good at growing in recent years. Despite worries that the recession would force people to cut back on holidays the company’s recent financial results have been fairly solid.
As Bowers observes, gesturing out of the window on a chilly November morning: “Our core market is taking North Europeans somewhere warmer.”
That growth means the company maintains a high number of high street shops in the UK and elsewhere, providing continuous real estate work for the legal team. It also means Tui is looking at its digital strategy and how to improve this side of the business – among its brands is popular website Laterooms.com.
Meanwhile, legal work is generated through Tui’s expansion into new areas.
“We’re constantly growing our product,” says Bowers. “One of our big strategic themes is a move towards more unique holidays.”
This, he explains, involves offering holidays to places or hotels that are exclusive to Tui, and can take the form of joint ventures with hotels, long-term leases or acquisitions.
“All that development requires financial commitments and the legal framework within which we take those commitments,” he adds.
Generally, Bowers says, the company tries to negotiate these agreements under English law but local law clauses are often required too.
One of Bowers’ tasks as he gets to grips with his expanded role is to streamline Tui’s use of external advisers, including those in its ‘destination’ countries – the places where most of its customers go on holiday.
“We’re in the process of getting a grip on who we use where and what we spend. We’re starting to make sure we’re using only one firm per destination market on a consistent basis,” he says.
For example, Tui has recently decided to use Dentons for Egyptian work after years of instructing several firms in the jurisdiction, and is going to turn to DLA Piper’s Turkish associate Yüksel Karkın Küçük in Istanbul.
Bowers says the fact these two firms are international is not why he chose them but rather that they provide fast and relevant advice.
“Our focus is, can we get really good service and timely, practical commonsense advice rather than theoretical academic advice that arrives two weeks after we’ve asked for it, in a really long note?” he says.
In a similar way, Bowers prefers to discuss fees at the outset of an instruction, get an indicative budget and then get regular updates on it. He is “not a fan” of fixed fees, arguing that either the client or the law firm ends up taking on unnecessary risk, although he is happy to use them for smaller matters where the outcome is predictable.
While the company is looking at its external advisers, Bowers is also making sure he is happy with the structure of his department.
“We’ve got a great team, but it probably needs reinforcement,” he says.
With all the work on his plate, Bowers may not always get the time he wants to follow Tui’s customers to the sun. But when he does, his destinations of choice are France or Greece.
“Give me a tiny Greek resort with a plane tree, a natural yoghurt and a glass of freshly squeezed orange juice,” he sighs.
Position: Group legal director
Reporting to: Andrew John, director, secretariat, health & safety and risk; William Waggott, chief financial officer
Legal capacity: 100
Head of legal and member services, ABTA
The EU’s review of the Package Travel Directive is likely to bring about the most significant change to travel company regulation for 30 years. An industry that is used to dealing with rapid innovation, creative business models and the fallout from natural and geopolitical events, has been struggling to reconcile outdated legislation with a travel market that bears little relation to that of the 1990s.
The proportion of travellers benefitting from the protections given by the directive has fallen dramatically and the European Commission has made it clear it wants that to change. The travel industry is largely supportive of that move – particularly to ensure better consistency and transparency for consumers and businesses. Travel companies want consumers to have confidence in a product that is generally paid for in advance and delivered many miles from home.
However, with such a diverse industry differences in emphasis arise – airlines will have one view; online accommodation suppliers another; and the small independent travel agent may not see the world in the same way as the global player.
And, importantly, member states need to consider how to deal with the regulatory challenges and the impact on the competitiveness of EU business when consumers are increasingly prepared to buy cross-border, both within and outside of the EU.