More than 100 holiday companies have been told to speed up their refunds policy for coronavirus cancellations.
The Competition and Markets Authority (CMA) has received more than 17,500 complaints from people whose holidays have been hit by the virus.
In an open letter from the CMA, companies have been reminded of the 14-day refund rule for cancellations.
Travel firms say this has been an unprecedented crisis that put many of them on the brink of collapse.
By law, if a package holiday is cancelled by the provider, then a refund should be provided for the whole holiday within 14 days.
Many thousands of getaways were cancelled during lockdown, when the Foreign Office advised against all but essential travel outside of the UK.
The CMA said its investigations found that some businesses may not have been giving these legally-required refunds.
Other problems included:
- Holidaymakers only being offered a voucher for future travel, rather than a full refund
- Customers losing their deposits or being charged cancellation fees
- Companies misleading customers about their rights
- People finding it difficult to contact travel companies or to claim refunds
In the letter, CMA director Cecilia Parker Aranha said the regulator recognised the “extraordinary pressures” faced by the sector.
“Although we were sympathetic to the challenges faced in the early days of the pandemic, it is nonetheless important that businesses comply with consumer law,” she added.