Under current legislation, tour operators must renew their ATOL licence every year to demonstrate their solvency, cash flow and adherence to Civil Aviation Authority requirements.
It is anticipated that corporate failures are likely from the last week of September, increasing costs from aviation fuel and air passenger duty as well as growing competition from online has left many businesses on the edge and has already pushed hundreds of organisations into administration.
Tour operators are not the only companies in the sector facing difficulties and scheduled airline groups are warning of their own burdens.
Today’s news comes just days after British Airways chief executive officer Keith Williams, warned the government of the added pressure it was putting on airlines and travel companies from what he labelled a “destructive tax juggernaught”.
He added: “The government is currently reviewing its air passenger duty (APD) levels for customers departing from the UK and is expected to announce the findings of the review by the end of November.
"British Airways is also calling on the government to take into account the likely financial effect of the new European Union Emissions Trading Scheme which starts in January 2012 as it reviews APD levels."