CTC Travel Regulations & Ethical Practices 2 — Questions and Answers
Question 1: Under the EU Package Travel Directive, what must travelers receive if a significant change is made to a package before departure?
- A full refund without penalty
- The right to accept the change or withdraw with a full refund (Correct answer)
- A voucher for future travel only
- A partial refund based on the change's impact
Correct answer: The right to accept the change or withdraw with a full refund
The EU Package Travel Directive entitles travelers to accept a significant change or withdraw from the contract with a full refund.
Question 2: A travel consultant accepts a high-value cruise booking and later discovers the client qualifies for a senior discount that wasn't applied. What is the ethical course of action?
- Keep the original price since the booking is finalized
- Inform the client and apply the discount retroactively if possible (Correct answer)
- Offer the discount only on the client's next booking
- Contact the cruise line privately to absorb the difference
Correct answer: Inform the client and apply the discount retroactively if possible
Ethical practice requires informing clients of discounts they qualify for and making corrections even after booking.
Question 3: Which U.S. federal agency regulates the sale of air transportation and enforces consumer protection rules for travel agents selling airline tickets?
- Federal Trade Commission (FTC)
- Department of Transportation (DOT) (Correct answer)
- Transportation Security Administration (TSA)
- Federal Aviation Administration (FAA)
Correct answer: Department of Transportation (DOT)
The DOT regulates air transportation consumer protection rules, including those applicable to travel agents selling air tickets.
Question 4: A client asks their travel consultant to book travel to a country under a U.S. Treasury OFAC travel ban. What must the consultant do?
- Book the travel but note the restriction in writing
- Refuse the booking and explain that a special license is required (Correct answer)
- Book through a third-country carrier to avoid the restriction
- Advise the client to use a VPN and book independently
Correct answer: Refuse the booking and explain that a special license is required
OFAC sanctions prohibit travel to certain destinations without a specific license, and consultants must not facilitate illegal transactions.
Question 5: What does the term 'fiduciary duty' mean in the context of a travel consultant's relationship with a corporate client?
- The consultant must always choose the lowest-cost option
- The consultant must act in the client's best financial interest above their own (Correct answer)
- The consultant must report all expenses to the IRS
- The consultant must hold client funds in escrow
Correct answer: The consultant must act in the client's best financial interest above their own
Fiduciary duty requires a consultant to prioritize the client's financial interests, avoiding conflicts of interest.
Question 6: A travel agency receives a preferred supplier override commission. Under ethical disclosure standards, when should this be disclosed to clients?
- Only if the client specifically asks about commissions
- Never, as commissions are proprietary business information
- When it may influence the consultant's recommendation (Correct answer)
- Only when the override exceeds 15% of the booking value
Correct answer: When it may influence the consultant's recommendation
Ethical standards require disclosing financial incentives that could influence or appear to influence supplier recommendations.
Question 7: Which international agreement standardizes the liability limits for airlines in cases of passenger injury, death, or baggage loss?
- The Warsaw Pact
- The Montreal Convention (Correct answer)
- The Hague Protocol
- The Geneva Convention
Correct answer: The Montreal Convention
The Montreal Convention of 1999 is the current international treaty governing airline liability for passengers and baggage.
CTC Travel Regulations & Ethical Practices 2
Under the EU Package Travel Directive, what must travelers receive if a significant change is made to a package before departure?