BEIJING (BLOOMBERG) – China has drafted sweeping regulations targeting online travel agencies and platforms based in the country after a deadly boating accident involving Chinese tourists in Thailand fuelled claims of lax oversight, according to a person familiar with the matter.
The regulation by China’s Ministry of Culture and Tourism would mandate that online travel providers improve rescue and emergency plans, better vet and manage their on-ground service providers, purchase liability insurance, and protect clients’ personal information, said the person, who asked not to be identified discussing internal policy deliberations.
It would represent Beijing’s first concerted attempt to monitor online tourism outfits, which have proliferated as Chinese tourists fan out across the globe.
While storefront travel agencies are forced to purchase liability insurance under current law, those regulations don’t extend to online platforms. Some web providers don’t hold a government-issued operating license or liability insurance, the person said.
The move to regulate the sector comes as Beijing battles to overcome a consumer confidence crisis triggered by scandals in its drug industry. Millions of Chinese tourists are expected to hit the road in the coming days as the country begins an annual “Golden Week” break to mark its National Day holiday on Oct 1.
The ministry did not immediately reply to a faxed request for comment on Friday (Sept 28).
Before the regulation can be implemented, Chinese law stipulates that it must solicit opinions from the public. The person said this would happen soon, without specifying a date.
A boat carrying Chinese tourists capsized off Phuket in July, leaving 47 dead and drawing harsh criticism in China over the lack of accountability for internet operators. The Beijing News reported that 121 of the 127 Chinese citizens involved in the accident had booked their trips via online tour platforms.
Shortly after the accident, the ministry issued an urgent notice requiring local authorities to carry out emergency investigations of online travel platforms, and call off any tour products found to be substandard.
A Thai government minister blamed the incident on Chinese tour operators who had failed to respect Thailand’s safety laws, Reuters reported. Chinese media outlets bashed online platforms for failing to put safety mechanisms in place.
China will be one of the world’s fastest growing online-travel markets over the next decade, according to Bloomberg Intelligence. The major players in its web tourism industry include Ctrip.com International Ltd., Tuniu Corp., and Alibaba Group Holding Ltd.’s travel service, Fliggy.
The country’s outbound tourism expenditure swelled to US$261 billion (S$357 billion) in 2016 – about one-fifth of the global market – 11 times the amount spent a decade earlier, according to the United Nations World Tourism Organisation.