Sunday, March 15, 2015

Industry Update: Wedding banquet cancellation fees need to be fairer, more transparent: CASE

The Consumers Association of Singapore (CASE) has finally weighed in on the high (and in our opinion punitive) cancellation fees which hotels charge for cancellation of wedding banquets.
 
While CASE conceded that the conditions of cancellation are based on private agreements between the hotel and consumers, it felt that these clauses should not be arbitrary and unfair to consumers who might not emotionally be in a position to bargain. These penalties could be as high as the full cost of the contract, hitting S$50,000 for some consumers. These fees, in the opinion of CASE, was excessive when compared to the actual loss incurred from the breach of contract. "We know hotels have waiting lists, so if they've gotten a cancellation they can always replace (the booking with) another one quite easily," said CASE's executive director Seah Seng Choon. "Particularly during peak periods and at popular hotels."
 
CASE is currently in discussion with the Singapore Hotel Association to adopt fairer contract terms regarding cancellations of wedding packages. Speaking on the sidelines of World Consumer Rights Day festivities on 15 March 2015, CASE President Lim Biow Chuan said he understands that most hotels would be reluctant to share such details publicly, but added that his association will apply more pressure should hotels remain uncooperative or are unfair to consumers.
Mr Lim said: "We are going to talk to the hotels, and ask them: 'look, what's the basis for giving such high cancellation charges?' If they're unable to justify it, we're going to push the hotels to publish their cancellation rates so consumers would be able to better understand the different rates at each hotel. "Once they begin to consider the public's perception - whether they are being fair in terms of their contracts - I think most hotels would come along and work with us."
 
Over the past four years, the consumer watchdog has handled 23 cases involving cancellation of wedding banquets (2 in 2011, 8 in 2012, 6 in 2013, 7 in 2014), with over 90 per cent of cases resolved successfully. It said these consumers were able to get a partial refund or smaller penalty fees. The full results of the survey are available on the website of CASE.

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