relationship between travel agent and airline

The historical circumstances that underpinned the predominance of agents have long since passed, such that the relationship is susceptible to the claim that it no longer amounts to ‘genuine’ agency. This proposition represents a tilt in the traditional philosophy of the commercial relationship between travel agents and airlines: that as ‘agents’ the entities could not compete, and are thereby excluded from the operation of competition laws. This article considers the influences underpinning this change, analyses the High Court of Australia’s decision in Australian Competition and Consumer Commission v. Flight Centre, and provides a contemporary understanding of agency in the online world.

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Scope of Agent’s Authority in Dealings with Third Parties: Revisiting the Debate Through the Tax Prism

by Tarun Jain† Cite as: 2022 SCC OnLine Blog Exp 85

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1. Introduction

The principles governing principal-agent relationship are now firmly established and well known, so much so that the law of agency has unequivocally ingrained itself in the commercial world. The axiomatic principles emanating therefrom are pivotal to ascertain legal consequences in wide-ranging tripartite situations, overwhelmingly extending their influence to entail tax implications as well. A recent decision of the Supreme Court has revisited the consequences of agency relationship qua the transactions between agent and third parties in the context of income tax law. It addresses an interesting issue; whether an agent can claim that the transaction (or a part of it) between it and the third party is an independent transaction even if it is occasioned on account of its agency relationship with the principal? This article dissects this decision to set in context the crucial interlinkage between agency law and tax law.

2. Dispute before the Supreme Court

The dispute before the Supreme Court arose in Singapore Airlines Ltd. v. CIT 1 . The relationship between travel agents and airlines was the centre-stage of dispute before the Supreme Court. The issue arose in view of the income tax obligation of the airlines to deduct tax at source (TDS) under Section 194-H 2 on the commission payable by them to the travel agents towards booking of tickets. In view of the peculiar position of the airline industry, there was two commissions received by the travel agent, which are referred to as “standard commission” and “supplementary commission”.

The occasion for these commissions arose owing to the airline setting up a base price for sale of tickets and permitting the travel agent to sell the tickets at a higher price. The standard commission was paid by the airlines for each ticket sold by the travel agent, calculated at 7% of the ticket base price. The excess of amount collected by the travel agent from the customer (i.e. amount in excess of the base ticket price) was permitted to be retained by the travel agent in terms of the airline policy. This excess amount is referred as the supplementary commission. The transaction flow can be illustrated as under:

The airline was affecting TDS on the standard commission it paid to the travel agents. However, it was argued that supplementary commission was not subject to TDS as inter alia the supplementary commission was not paid by the airline and was the travel agents’ own income. There was a cleavage of judicial opinion amongst the High Courts as to supplementary commission being subject to TDS. The Delhi High Court 3 and Madras High Court 4 had opined against the airlines whereas the Bombay High Court 5 concluded in its favour holding that TDS was not applicable on the supplementary commission. In this background, the issue came up for consideration before the Supreme Court.

3. Decision of the Supreme Court

The Supreme Court in its decision in Singapore Airlines 6 has extensively examined the industry practice prevailing in the airline industry and the manner in which travel agents earned their remuneration. It is interesting to note that in order to delineate the legal positioning of the travel agents within the airline industry, the decision opined upon the purport of relationship set out in Section 194-H to observe that it is principally concerned with principal-agency relationship. Taking cue from the expression “acting on behalf of” in the provision, the Supreme Court concluded that the nature of the relationship envisaged in Section 194-H was “interlinked” with the law of agency as expounded in the Law of Contract . 7 Thus, to address the controversy, it was required to determine “whether the travel agents were ‘acting on behalf of’ the airlines during the process of selling flight tickets”, which question would in turn have a substantial bearing on the nature of the supplementary commission.

Dissecting the relationship, at a conceptual level, the Supreme Court found it incongruent that the airlines did “not dispute that a principal-agent relationship existed during the payment of the standard commission” and yet they contended against a principal-agent relationship for the “second part of the transaction i.e. when the tickets were sold to the customer and for which the travel agents earned certain amounts over and above the net fare set by the” airlines. To address the dichotomy, the Supreme Court took recourse to its earlier precedents delineating the distinction between principal-agent versus master-servant relationship 8 and contract of agency versus contract of sale 9 to declare that the determination of the relationship was hinged upon determining the manner in which the title to the tickets passed from the airline and reached the customers. To this end, the Supreme Court framed the following three mixed questions of law and facts which required advertence;

“From the catena of cases elaborating on the characteristics of a contract of agency, the following indicators can be used to determine whether there is some merit in the (airlines) contentions on the bifurcation of the transaction into two parts:

Firstly, whether title in the tickets, at any point, passed from the (airline) to the travel agents;

Secondly, whether the sale of the flight documents by the latter was done under the pretext of them being the property of the agents themselves, or of the airlines;

Thirdly, whether the airline or the travel agent was liable for any breaches of the terms and conditions in the tickets, and for failure to fulfil the contractual rights that accrued to the consumer who purchased them.”

In effect, therefore, as evident from the aforesaid questions, the Supreme Court applied the test of transfer of title to determine the nature of relationship between the airlines and travel agents. It is evident that the travel agent would have been acting in the capacity of principal if the title in the tickets passed from the airlines to the travel agent and thereafter from travel agent to the customers whereas the travel agent would be acting in agency capacity if the title directly pass from the airline to the customers.

Upon a perusal of the contract between the airlines and the travel agent, the Supreme Court inter alia took note of an undisputed stipulations in the agreement between the airlines and the travel agents that the travel documents “… are and remain the sole property of the carrier … until duly issued and delivered pursuant to a transaction under this agreement”, which unequivocally clinched the matter as it implied that at no stage the title in the tickets, transferred from the airlines to the travel agent and the tickets remained the property of the airline. On this premise, the Supreme Court unhesitatingly concluded that “[n]o contract of sale between two principals was ever in existence” between the airlines and the travel agent. This effectively foreclosed the contention that the travel agent was acting as a principal with the customer qua the supplementary commission.

However, the Supreme Court did not rest it conclusion only on this ground. In its decision it further went on to exemplify from other contractual stipulations that several elements of a contract of agency stood satisfied. It inter alia highlighted the following: (A) “Every action taken by the travel agents is on behalf of the air carriers and the services they provide is with express prior authorisation. The airline also indemnifies the travel agent for any shortcoming in the actual services of transportation, and any connected ancillary services, as it is the former that actually retains title over the travel documents and is responsible for the actual services provided to the final customer.” (B) “Furthermore, the airline has the responsibility to provide full and final compensation to the travel agent for the acts it carries out under the” agreement. Thus, the Supreme Court found enough substance in the agreement that the travel agent acted on behalf of the airlines at all times, rendering the airlines liable for all their acts and thereby firmly establishing the agency relationship between them on all counts without exception of the supplementary commission.

As regards the application of the TDS provisions on the supplementary commission, the following observations of the Supreme Court are pertinent;

Section 194-H “does not distinguish between direct and indirect payments. Both fall under Explanation ( i ) to the provision in classifying what may be called a ‘commission'”.

In this wake of the statutory scheme, “the factum of the exact source of the payment would be of no consequence to the requirement of deducting TDS. Even on an indirect payment stemming from the consumer, the (airlines) would remain liable under the IT Act. Consequently, the contention of the airlines regarding the point of origination for the amounts does not impair the applicability of Section 194-H of the IT Act”.

How the airline would appraise itself of the exact quantum of supplementary commission earned by the travel agent from the customer, so as to determine the quantum of TDS, is a question of “mechanics” which must be figured out by the airline in order to discharge its TDS obligation.

“Further, the lack of control that the airlines have over the actual fare charged by the travel agents over and above the net fare, cannot form the legal basis for the (airlines) to avoid their liability” because “an agent undoubtedly retains a sizeable level of discretion on how to achieve the desired results”. 10

For the aforesaid reasons, the Supreme Court confirmed the decision of the Delhi High Court to the effect that the airlines were obliged to apply TDS even on the supplementary commission earned by the travel agents by way of retaining the amounts directly from the customers.

4. Implications of the decision qua scope of TDS provisions

There is a clear finding by the Supreme Court linking the TDS obligation under Section 194-H to the law of agency. 11 This has substantial bearing on large number of pending disputes. It would be interesting to observe the application of this decision wherein it has been inter alia contended that there is no payment by the alleged principal, even if there is payment, it is not in the nature of the commission. An indiscriminate application of the principle 12 that Section 194-H is based on agency relationship (and other related observations in this decision) is likely to render academic all such contentions.

From another angle, the implications of the decision are far beyond Section 194-H. From a TDS perspective, the key takeaway from this decision is that it is not necessary for the TDS provisions to apply that the funds flow directly from the pay or to the receiver; the TDS obligation nonetheless continues to exist even if the flow of funds to the receiver is from third parties if the flow can be traced to the transaction which is subjected to TDS. On this account, it would be difficult to restrain the ratio of this decision as being confined to Section 194-H alone and arguably the Tax Department can be expected to stretch the proposition emanating from this case to all TDS situations.

5. Reflections on agent’s authority to act independently

Notwithstanding the fact that the decision is the context of tax law, it has wide ramifications even within the realm of the law of agency. One can contend that the decision establishes the proposition that the law of agency does not accommodate dissection of agent’s acts so as to classify some of its actions as if on principal-to-principal basis with third parties while continuing to act as an agent of the main principal. The reference by the Supreme Court to the decision in Bhopal Sugar Industries 13 and opining that there were no two principals is clearly testament to the fact that the first transaction (i.e. between the airline and the travel agent) qualifying as an agency would, as if by default, rule out the principal-to-principal status of the second transaction and the second transaction would invariably be an extension of the principal-agency relationship under the first transaction. Put differently, this decision of the Supreme Court arguably institutes the proposition that an agent cannot generally be considered as acting on a principal basis himself with third parties once his dealing with such parties are in pursuance of an agency relationship with the principal.

A lot also turns of the following observations of the Supreme Court are instructive;

47 . The fact that the travel agent has discretion to set an actual fare which is above the net fare has no effect on the nature of the relationship between the parties. A contract of agency permits an agent to carry out acts on its own volition provided it does not contravene the purpose of the agency contract and the interests of the principal. The accretion of the supplementary commission to the travel agents is an accessory to the actual principal-agent relationship under the PSA. In such a commercial arrangement, the benefit gained by an agent is incidental to and has a reasonably close nexus with the responsibilities that were entrusted to it by the principal air carrier. Such incidental benefits or actions must come under the ambit of the relationship, subject to any express limitations articulated in the contract itself or under the Contract Act.

The aforesaid observations go a long way in establishing the scope of agency itself. The fact that consideration for agency can flow from third parties directly the agent (as the supplementary commission reveals) is now firmly established. The decision also establishes that once the obligation of the principal continues qua third parties, it would be difficult to conclude that agency relationship does not exist notwithstanding the incidental aspects. Indeed, the Supreme Court referred to the provisions of the Contract Act which deal with “right of principal when agent deals, on his own account, in business of agency without principal’s consent” 14 and “principal’s right to benefit gained by agent dealing on his own account in business of agency” 15 . However, the Supreme Court found these provisions inapplicable in the factual premise as the agreement between the airline and the travel agents “does not explicitly address the issue of supplementary commission at all”. More critically, the Supreme Court observed, “an agent acting of its own account does not, in principle, alter the nature of a contract of agency and only gives rise to the consequences mentioned under Sections 215 and 216 of the Contract Act if the conditions contained within them exist”.

Taken to their logical end, this decision endorses the legal position that the fact that the agent reserves for himself sufficient latitude to determine the terms of engagement with third parties does not transform the nature of its relationship with the principal. The legal difference between the authority of an agent vis-à-vis a servant clearly expounds that agent’s dealings with third parties accommodate an agent to carry out “acts on its own volition”. A caveat does exist that such acts should “not contravene the purpose of the agency contract and the interests of the principal”. However, pragmatically, such caveat would play out only where the principal refuses to “condone” the alleged transgressions of the agent. Thus, in practical terms, the following legal position can be considered to arise from the decision:

So long as the principal accommodates/ratifies the acts of the agent, it would be difficult to conclude that the transactions of the agent with third parties are beyond the scope of agency notwithstanding that the agent has not been expressly authorised to certain ends or the fact, as in this case, that the agent has negotiated the price with the customer and retained a part of the price for itself;

Even if the principal disagrees with the acts of the agents, in view of Sections 215 and 216, at best the principal can sue the agent for share in the additional benefit of the agent (Section 216) or get the agency agreement terminated (Section 215). However, even in wake of such empowerment of the principal, there is nothing in the law which “alter the nature of a contract of agency” in situations of an agent acting of its own account.

The decision, therefore, undoubtedly establishes a wide latitude for agents to act independently within the larger framework of the agency agreement with the principal. Viewed differently, the decision categorically expounds upon the agent’s ability to deal with third parties within the larger framework of the agency relationship.

6. Conclusion

There are few contemporary decisions of the Supreme Court addressing the scope of agent’s authority qua third parties. On this count, the decision is a welcome addition on the jurisprudence as it fine tunes the legal framework to address the pragmatic commercial realities by declaring that it is wide to subsume almost all acts of the agent and dealings with third parties subject perhaps only to the larger guiding factors of ( a ) purpose of agency, and ( b ) interests of the principal, and obviously, the overarching statutory framework. This decision of the Supreme Court, albeit in the context of tax law, thus, effectively delineates the wide empowerment of an agent and the contours of the agency relationship extending to his transactions with third parties.

The aforesaid summation of the decision, in the larger context of agency law, is admittedly in addition to the ratio of the decision which is to the effect that ( i ) an agent continues to act in the capacity of the agent even if he is empowered to negotiate the price with the customer and retain a portion of it for itself; ( ii ) and all remuneration received by the agent would be subject to tax deduction by the principal even if part of the remuneration does not directly flow from the principal to the agent and is instead received by the agent by retaining a part of the amount received from the customer.

† Tarun Jain, Advocate, Supreme Court of India; LLM (Taxation), London School of Economics

1. 2022 SCC Online SC 1588 .

2. S. 194-H, Income Tax Act, 1961. The said provision inter alia obliges TDS by the payer on “any income by way of commission” wherein “commission or brokerage includes any payment received or receivable, directly or indirectly, by a person acting on behalf of another person for services rendered (not being professional services) or for any services in the course of buying or selling of goods or in relation to any transaction relating to any asset, valuable article or thing, not being securities”.

3. CIT v. Singapore Airlines Ltd. , 2009 SCC OnLine Del 823 .

4. Around the World Travel and Tours (P) Ltd. v. Union of India , 2003 SCC Online Mad 1027 .

5. CIT v. Qatar Airways , 2009 SCC Online Bom 2179 .

6. 2022 SCC Online SC 1588 .

7. Contract Act, 1872, S. 182. It states, “an ‘agent’ is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the ‘principal’.”

8. Lakshminarayan Ram Gopal and Son Ltd. v. Govt. of Hyderabad , AIR 1954 SC 364 .

9. Gordon Woodroffe and Co. (Madras) Ltd. v. Shaik M.A. Majid , AIR 1967 SC 181 : 1966 Supp SCR 1; Khedut Sahakari Ginning and Pressing Society Ltd. v. State of Gujarat , (1971) 3 SCC 480 ; Bhopal Sugar Industries Ltd. v. STO , (1977) 3 SCC 147 .

10. Relying upon Lakshminarayan Ram Gopal , AIR 1954 SC 364 and Qamar Shaffi Tyabji v. Commr., Excess Profits Tax , AIR 1960 SC 1269 : (1960) 3 SCR 546.

11. “S. 194-H is to be read with S. 182 of the Contract Act. If a relationship between two parties as culled out from their intentions as manifested in the terms of the contract between them indicate the existence of a principal-agent relationship as defined under S. 182 of the Contract Act, then the definition of “commission” under S. 194-H of the IT Act stands attracted and the requirement to deduct TDS arises.”

12. Read alongside the earlier decision of the Supreme Court in Director , Prasar Bharati v. CIT , (2018) 7 SCC 800 which is cited with approval in this decision.

13. Bhopal Sugar Industries Ltd. v. STO , (1977) 3 SCC 147 . It is relevant to note that the Supreme Court in this decision inter alia quoted with approval the following observations in Bhopal Sugar Industries decision; “A contract of agency, however, differs essentially from a contract of sale inasmuch as an agent after taking delivery of the property does not sell it as his own property but sells the same as the property of the principal and under his instructions and directions. Furthermore, since the agent is not the owner of the goods, if any loss is suffered by the agent he is to be indemnified by the principal. This is yet another dominant factor which distinguishes an agent from a buyer pure and simple.”

14. “215. Right of principal when agent deals, on his own account, in business of agency without principal’s consent. If an agent deals on his own account in the business of the agency, without first obtaining the consent of his principal and acquainting him with all material circumstances which have come to his own knowledge on the subject, the principal may repudiate the transaction, if the case shows, either that any material fact has been dishonestly concealed from him by the agent, or that the dealings of the agent have been disadvantageous to him.”

15. “216. Principal’s right to benefit gained by agent dealing on his own account in business of agency. If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account of his principal, the principal is entitled to claim from the agent any benefit which may have resulted to him from the transaction.”

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Airline Reporting Corporation and IATA Billing and Settlement Plan: How They Work

• Business ,   Travel
• 21 May, 2020
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What are BSP and ARC?

Payment workflows in bsp and arc.

In this case, BSP/ARC play the major role in a transaction

• A traveler pays an agent/OTA.
• The agent requests ticketing from a GDS.
• The GDS accesses the airline’s passenger service system for ticketing data.
• Also, the GDS sends the information about ticketing to the BSP/ARC data processing center.
• The processing center sends a billing report to an agent via BSPLink or My ARC, web interfaces that we’ll talk about below.
• The agent pays the clearing bank on a schedule (usually, once a week).
• And finally, the bank distributes money to the appropriate airlines.

This scenario doesn’t involve BSP/ARC clearing bank, but they are still involved in a transaction

• The GDS accesses an airline’s passenger service system for ticketing data.
• The GDS also sends the information about ticketing to the BSP/ARC data processing center.
• The processing center sends a billing report to an agent via BSPLink or My ARC.
• The processing center sends transaction invoicing data to the airline payment processor.
• The payment processor invoices a traveler’s card issuer and a traveler pays via agent/OTA gateway.
• And finally, the airline’s payment processor sends money to the airline.

Here’s an IATA’s visualization of the BSP in NDC

BSPLink and My ARC

• BSP Billing Statistics and reports,
• Agency Debit/Credit Memos with ability to dispute them (ADM/ACM are accounting notices that airlines send travel agents, if they believe the agent hasn’t complied with some ticket rules.),
• Refund functionality, and
• Communication tools with IATA and airlines.
• interactive agent reporting (IAR) and sales summaries,
• memo management tools,
• accreditation portal, and
• document retrieval.

IATA BSP and ARC accreditation

Iata accreditation, arc accreditation.

• ARC Accredited agency – standard accreditation for travel agents;
• ARC Verified Travel Consultant (VTC) – a non-ticketing option at ARC similar to TIDS at IATA;
• ARC Corporate Travel Department (CTD) – a ticketing option for corporate flight booking .
• Be an ARC specialist or become one by passing the ARC Specialist Qualifier Exam. Before passing it, you must complete the training to use My ARC.
• Provide an Employer ID Number and any licenses for local jurisdictions.
• Fill out an application form .
• Have a bank account for ARC operations.
• Be ready to provide a $2,300 application fee and a bond, letter of credit, or cash deposit in the amount of $20,000.
• Wait while the application is reviewed and documentation is verified. ARC will contact you for an interview. The whole verification may take as much as 90 days.
• Create a My ARC account.
• Download and complete the VTC online request.
• Pay an application fee of $195.
• You must have a bank account for ARC operations.
• Wait until ARC reviews your documentation. The verification may take up to 30 days.
• You need to be an ARC specialist .
• The organization must have an IRS Employer Identification Number (EIN).
• You must meet personnel requirements stated in Part II-8 of the Corporate Travel Department Reporting Agreement (CTDRA) .
• Be ready to provide a $3,000 application fee and a bond, letter of credit, or cash deposit in the amount of $20,000.
• Wait while the application is reviewed. ARC will contact you for an interview. The whole verification may last up to 90 days.

ARC vs IATAN

Additional options and alternatives to iata bsp and arc that agents must know.

Tour Operators Revamp Partnerships With Airlines to Drive New Business

Rashaad Jorden , Skift

February 25th, 2022 at 1:00 PM EST

Tour operators need to be attentive to their customers' travel preferences, including favorite airlines. It's possible that many such companies squandered lucrative opportunities for years by not partnering with companies their guests love.

Rashaad Jorden

Numerous tour operators are successfully using strategic partnerships with entities such as cooking schools and healthcare companies to drive business since resuming their Covid-paused trips.

But operators also believe they’ve found new ways to partner with powerful corporations several have worked with for a long time — major airlines. Of course, the relationship between airlines and tour operators is not new, but some tour operators are highlighting issues they view are important to travelers in these new marketing alliances to attract customers for a post-pandemic era.

Those partnerships, which could boost many businesses in the two sectors still struggling to hit pre-Covid metrics, are also likely to increase in years to come as tour operators look to take advantage of many travelers’ loyalty toward certain airlines.

“We saw the value in a commercial airline partnership due to the importance of having our guests arrive well-rested, well-fed and having experienced the best flight of their lives,” said Amanda Wilson, vice president of partnerships at Wilderness Safaris , adding most of her company’s guests travel more than 20 hours to participate in its trips.

Wilderness also needed to find ways to attract travelers during the pandemic, so it sought the assistance in the summer of 2020 of an airline that has received high marks in recent years in the areas of business class and catering , Qatar Airways. The partnership , which includes $350 off business or first class tickets on flights to Qatar Airways’ routes to Africa originating from the U.S., Canada and Brazil, launched in September of the following year.

In addition, for each such ticket sold, Wilderness has committed to planting 40 trees in Rwanda. Wilson said that since the launch of the alliance, Qatar Airways has sold 50 business or first class tickets on its flights to Africa.

“Wilderness and Qatar Airways believed (the relaunch of travel) could be achieved by providing a truly valuable travel incentive that also supported a shared ethos of conservation and making a positive impact,” Wilson said.

But has the partnership with Qatar Airways contributed to an overall surge in bookings for Wilderness? Wilson declined to provide any figures for bookings in 2022 compared to previous years, but said the company was experiencing a surge compared to previous years. She also credited the alliance for increasing its brand awareness with Qatar Airways’ customers.

Meanwhile, the carrier — which launched routes to Zambia and Zimbabwe at the end of 2021 and now flies to all six African destinations where Wilderness owns and operates camps — has flown more than 170,000 passengers to Africa from March 2021 to this month. That figure, a Qatar Airways spokesperson said, is a threefold increase from the previous 12-month period.

Tour operators that are considering whether to enter into partnerships with airlines are taking note of such figures. “I think the biggest benefit of an airline marketing partnership would be the new audience they would introduce to our tours,” said smarTours CEO Christine Petersen. “Airlines have very loyal customers and we would love to be able to tap into that audience.”

When asked what factors her company would consider prior to committing to a partnership with an airline, Petersen emphasized one of them would be how popular the carrier is popular with smarTours travelers. Brand loyalty toward an airline played a significant role in spearheading the Qatar Airways-Wilderness partnership — a Qatar Airways spokesperson said that its top customers’ loyalty was a major reason Wilderness executives initiated discussions about a partnership.

Petersen answered that the other critical factor for any possible partnerships with airlines is whether they already serve smarTours’ most popular destinations. One flag carrier that has benefited from the pent-up demand in its home country is Icelandair. Although its North American Communications Manager Michael Raucheisen declined to state which tour operators the airline has partnered with, he said the company is working with numerous such companies to create itineraries taking travelers to Iceland.

“Since Iceland has been growing in popularity , many tour operators are eager to add (it) to their destinations list,” Raucheisen said, adding that Icelandair’s sales teams take the lead in initiating partnership discussions with North American-based tour operators. “Tour operators are always looking to grow (their) offerings and we determine if Iceland would be a mutually beneficial product to sell.”

How else do airlines benefit from partnering with tour operators? Petersen responded that tour operators would assume much of the heavy lifting in such alliances. “Planning a trip is time consuming and a lot of work,” she said.

“Tour operators take on the logistics of additional transportation, country entry guidelines, visiting sites off-peak for fewer crowds, booking Covid-19 tests for the return flight home, among many other components of an international trip.” 

That’s heavy work, indeed. But Petersen embraces the possibility of having to assume those duties as part of an alliance with an airline, especially considering the revenue it could provide her company.

“There’s a segment of travelers who love tours and a segment who are very loyal to their air carrier of choice,” she said. “Where they intersect could be the sweet spot.”

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IT Consulting & Staffing

Travel Agent Contract: Everything You Need to Know

The ins and outs of a travel agent contract.

Traveling passion many, some, career. Travel agents play a key role in helping people plan and book their dream vacations. However, relationship travel agent clients governed contract. In blog post, delve intricacies travel agent contract why crucial parties involved.

What is a Travel Agent Contract?

A travel agent contract is a legally binding agreement between a travel agent and their client. It outlines terms conditions services provided travel agent, responsibilities client. This contract serves as a protection mechanism for both parties, ensuring that expectations are clear and disputes are minimized.

Key Components of a Travel Agent Contract

A typical travel agent contract includes the following key components:

Why a Travel Agent Contract is Essential

For both travel agents and clients, having a solid contract in place is essential for several reasons:

• Clarity: A contract ensures parties same page regarding scope services fees involved.
• Protection: It safeguards travel agent client event disputes unforeseen circumstances.
• Professionalism: A well-drafted contract shows travel agent takes business seriously committed providing quality service.

Case Study: The Importance of a Travel Agent Contract

In a study conducted by the Travel Agency Association, it was found that travel agents who utilized comprehensive contracts experienced a 30% decrease in client disputes and an 20% increase in customer satisfaction. This clearly demonstrates the positive impact of having a well-defined contract in place.

A travel agent contract is a crucial aspect of the relationship between a travel agent and their clients. It provides clarity, protection, and professionalism, ultimately leading to a smoother and more successful partnership. Both parties should take the time to review and understand the terms of the contract before signing, ensuring a mutually beneficial arrangement.

Travel Agent Contract: 10 Legal Q&A

Exclusive travel agent contract.

This Exclusive Travel Agent Contract (“Contract”) entered Effective Date between undersigned parties.

Termination

This Contract may be terminated by either party with written notice to the other party. In the event of termination, the Travel Agent shall be entitled to receive compensation for all services rendered up to the date of termination.

Governing Law

This Contract shall be governed by and construed in accordance with the laws of [State/Country], without giving effect to any choice of law or conflict of law provisions.

Entire Agreement

This Contract contains the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, whether oral or written.

Case Based Research in Tourism, Travel, Hospitality and Events pp 379–397 Cite as

The Role of Strategic Stakeholder Groups in the Air Transport and Tourism Industries

• Bing Chan 6 &
• Sik Kwan Tai 6  
• First Online: 05 January 2022

1135 Accesses

This case study sheds light on the air transport industry and the key historical choices made by the industry strategic member groups. With this understanding, it is possible to identify strategic patterns and potential problems that could limit the implementation of new opportunities contributing to better business in the post-COVID19 era. The case study invites readers to make sense of the current state of the air transport industry and the broader business environment to help re-think the strategic direction and choices of air transport strategic member groups – to promote responsible travel and tourism. To achieve this aim, readers are asked to refer to the traditional air transport distribution channel structure and use Porter’s Five Forces model and the PESTEL framework for a more comprehensive assessment. A clear understanding of the air transport context is likely to result in a more thoughtful outline of suitable future-driven strategic choices and scenarios.

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COVID-19 – Coronavirus disease began in Wuhan, China in December 2019. World Health Organization (WHO) reported global confirmed death cases of over 880,000 as of 7 September 2020 , https://covid19.who.int/

EADS – European Aeronautics Defence and Space Company.

FAA – USA Federal Aviation Administration.

CADE – Administration Council for Economic Defense (in Portuguese, Conselho Administrativo de Defesa Econômica).

Comac – Commercial Aircraft Corporation of China, Ltd., Chinese state-owned aerospace manufacturer established in 2008.

Craic – China-Russia Commercial Aircraft International Company.

RPK – Revenue passenger kilometres.

ASK – Available seat kilometres.

PLF – Passenger load factor.

SABRE – Semi-Automated Business Research Environment, an automated system.

CMA – Competition and Markets Authority.

Acquired by affiliate of the Siris Capital Group, LLC (“Siris”) and Evergreen Coast Capital Corp.

CAB – U. S. Civil Aeronautics Board.

accounting documents – such as E-Tickets and electronic miscellaneous documents (EMDs) for ground transport and hotel nights.

ICAO – International Civil Aviation Organization.

WSG – Worldwide Slot Guideline.

References and Suggested Readings

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Air Transport Action Group. (2018, October 2). Aviation: benefits beyond borders. Aviation: Benefits Beyond Borders Regional and Group Reports . https://aviationbenefits.org/downloads/aviation-benefits-beyond-borders/ . Accessed 28 July 2020.

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Competition and Markets Authority. (2020, April 9). CMA blocks airline booking merger. Press release of the competition and markets authority . https://www.gov.uk/government/news/cma-blocks-airline-booking-merger . Accessed 31 July 2020.

C.R. (2018, July 10). Airbus and Boeing are tightening their hold on the sky. The Economist . https://www.economist.com/gulliver/2018/07/10/airbus-and-boeing-are-tightening-their-holdon-the-sky . Accessed 28 July 2020.

Dolan, K. (2013, March 13). The incredible, amazing jumbo jet that Prince Alwaleed never really bought. Forbes. https://www.forbes.com/sites/kerryadolan/2013/03/13/the-incredibleamazing-jumbo-jet-that-prince-alwaleed-never-really-bought/#2071ddac2ee9 . Accessed 27 July 2020.

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International Civil Aviation Organization. (2013). Airport competition. Working paper of the Worldwide Air Transport Conference, sixth meeting , 18–22 March 2013. https://www.icao.int/Meetings/atconf6/Documents/WorkingPapers/ATConf.6.WP.090.en.pdf . Accessed 29 July 2020.

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Pearce, J., & Robinson, R. (2014). Strategic management planning for domestic & global competition (14th ed.). McGraw-Hill.

Pearlstein, S. (2018, April 25). Boeing and Airbus, the new super duopoly. The Washington. https://www.washingtonpost.com/news/wonk/wp/2018/04/25/boeing-and-airbus-the-newsuper-duopoly/ . Accessed 27 July 2020.

Porter, M. (1979). How competitive forces shape strategy. Harvard Business Review , March–April, 137–145. https://doi.org/10.1097/00006534-199804050-00042 .

Porter, M. (2008). On competition. Harvard Business Review Book . Updated and expanded edition. http://ressources.aunege.fr/nuxeo/site/esupversions/ba0a40a7-4350-475d-a5032475adcb9925/res/porter.pdf . Accessed 27 July 2020.

Redondo, A. (2020, May 12). Severe impact from COVID-19 interrupts positive financial performance in the beginning of the year. Press release of Amadeus Corporate. https://corporate.amadeus.com/en/newsroom/covid-19-interrupts-positive-financialperformance-in-the-beginning-of-the-year . Accessed 28 July 2020.

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BNU-HKBU United International College, Zhuhai City, China

Bing Chan & Sik Kwan Tai

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Correspondence to Bing Chan .

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Department of Business Administration, University of Piraeus, Piraeus, Greece

Marianna Sigala

Strategy and Operations Discipline, Kaplan Business School, Brisbane, QLD, Australia

Anastasia Yeark

Blue Mountains International Hotel Management School, Torrens University, Sydney, NSW, Australia

Rajka Presbury

Faculty of Higher Education, William Angliss Institute, Melbourne, VIC, Australia

Marcela Fang

Wellington School of Business and Government, Victoria University of Wellington, Wellington, New Zealand

Karen A. Smith

Teaching Note

Case summary.

This case study sheds light on the air transport industry and the key historical choices made by the industry strategic member groups. The case study invites readers to make sense of the current state of the air transport industry and the broader business environment to help re-think the strategic direction and choices of air transport strategic member groups – to promote responsible travel and tourism.

Teaching and Learning Objectives

Critically assess the air transport industry and the role each strategic member group plays in the current strategic playfield 2. Apply strategic management concepts to a real case study and develop suitable future driven strategies 3. Use critical thinking and creative skills to propose supply-side strategic direction and choices, which could contribute to better post-COVID air transport playfield

Target Audience

Intended for the undergraduate and/or master-degree students on courses such as:

Teaching Approach and Strategy

The lesson should begin with an overview of the key strategic terms and concepts highlighted in this case study. For example, the meaning of “duopoly competition”. Overview of the current macro-environment and the state of the industry should be guided by the PESTEL framework and Porter’s five forces model.

When analysing the case, students should :

Draw a timeline of events or historical developments in each strategic member group category to identify trends and make contextual assumptions.

who are the major competitors in each member group category?

are the sectors entering a growth or maturing stage? (explain)

what were the key sector-specific strategic decisions or changes? (identify the causes/drivers)

what are the most common internal/external issues that a typical airline may face? (consider different times and contexts)

Provide recommendations – strategic direction and choices with a future-driven action plan; justify who should be responsible for the changes to achieve the desired outcomes.

Case study questions and sample answers :

With reference to commercial airlines, perform Porter’s Five Forces analysis for the air transport industry. Assess the highest potential threat with relevant justification.

Barriers of entry: high to moderate

Customers: collectively high potential force, many in numbers

“airline retailing” through personalisation, value-based marketing for direct Substantial economy of scale and capital, such as costs of start-up, airport gate and timeslot

Airliners need to purchase/lease aircraft, for example, All Nippon Airways purchased 20,787 Dreamliners worth Boeing $5 billion; management is concerned with high aircraft, fuel and labour cost factors – representing about 22% of operating costs; LCCs may have lower operational cost advantages

Pass airline and pilot government certifications

channel distribution

Indirect customers (travel agencies acting as intermediaries, wholesaler or retailer)

Suppliers: high potential force, duopoly suppliers

Boeing and Airbus – not easily replaced due to operational commonality and exclusive supplier contract; adverse economy of large-scale production (higher-skilled workforce) means unable to sell in a large number of aircraft, hence the backlogs and advance orderings

High-to-moderate depends on fuel cost or leverage

Competitive rivalries: high level competitive rivalry; full-service carriers as well as low-cost carriers – over 290 IATA airlines

Substitutes: high to moderate potential force

Transportation services can be easily replaced; e.g. high-speed trains, cars, or coaches

Use Porter’s Five Forces to assess the Global Distribution System (GDS) business environment. What is the key threat in the case of Amadeus? Explain.

A barrier to entry: high. High start-up costs, GDS takes many airline CRS seat inventory systems and distributes them via travel agents

Customers: moderate. The retail/wholesale travel agencies are the customers of GDSs; travel agencies rely on GDS for airline services, fare-pricing and ticket issuance

Suppliers: moderate. In 2010, the three GDSs collectively supplied over 500 airlines, 90,000 hotels and 30,000 car rental locations as inventories

Competitive rivalries: High potential force. Three major GDSs dominate the industry, but in future, airlines could be the direct channel

Substitutes: High-to-moderate force. For example, Lufthansa Airlines use new technology like NDC as disintermediation

Explain the meaning of oligopoly, duopoly, monopolistic-competition, and perfect market with reference to the Airbus and Boeing market structure. Do you think it is possible to promote consolidation in the aircraft manufacturer market?

Monopoly: Anti-competitive activities such as dominant position, abuse of buying power and/or attempt to monopolise so that higher price, fewer choices are available to the consumers; market share and concentration factors should be considered

Oligopoly/Duopoly: A market structure with high entry barriers, a few firms offer similar products like Airbus and Boeing that dominate the market

Further consolidation is possible after the Boeing- Embraer merger

Identify the external and internal stakeholders of a typical commercial airline. Which stakeholder has the highest legitimate power and interest? Why?

Government regulators, e.g. US DOT to determine industry competitiveness. Hence, regulators may have a higher legitimate power over other stakeholder groups.

How do you think the COVID-19 pandemic will impact short- and long-term international tourist arrivals? How would you compare the Covid-19 situation and impacts to SARS? Discuss.

This question is open for class discussion. If the COVID-19 impact has a SARS shaped profile with UNWTO forecasted a short-term decline of a 60–80% international tourist arrivals in 2020, then it’s dramatic ups and downs.

Define the term ‘operational commonality’ and describe its importance to a typical airline. What are the implications for strategic developments?

Monogamy practice in airline management

On the rise due to airline’s reliance on one airplane fleet with one aircraft manufacturer to reduce costs of pilot training and spare parts inventories (also refers to aircraft commonality)

Use the Internet to find out more about the Commercial Aircraft Corporation of China, Ltd. (Comac). Do you think Airbus’s A320 and Boeing’s B737 can compete with Comac’s aircraft? Why or why not?

Comac has the capacity to produce over 150-seat aircraft. Students may provide any other acceptable answers with justifications that relate to short- and long-term effects.

Conduct PESTEL analysis and describe the macro-environment for the air transport industry.

Airline: political: regulators – e.g. ICAO; economic: inflation and interest rates; social/environmental: employment rate, social trends, privacy and security concerns, aircraft emission, health risk; technological: aircraft innovations, online reservation, NDC influence on distribution channel

Airport legislator versus private investor (for management expertise and cost efficiency)

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Chan, B., Tai, S.K. (2022). The Role of Strategic Stakeholder Groups in the Air Transport and Tourism Industries. In: Sigala, M., Yeark, A., Presbury, R., Fang, M., Smith, K.A. (eds) Case Based Research in Tourism, Travel, Hospitality and Events. Springer, Singapore. https://doi.org/10.1007/978-981-16-4671-3_21

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The Importance of Supplier Relationships for Travel Programs

• May 25, 2022

The travel industry has transformed tremendously in the last two years. Airlines in particular have experienced an evolution of challenges and obstacles to overcome. The scope and size of the big four continue to decrease and expect to be reduced by 30-40 percent.  Their entire organizations have become smaller as well.

Results of this include:

• Increased focus on building and defending their hubs.
• Reduced (or elimination of) service to smaller markets.
• Change in focus to cleanliness from on-time performance, completion factor, and in-flight service.
• Increased flexibility as it applies to restrictive type airline tickets.
• Reduced size of sales organizations will impact TMC and corporate relationships.

As the travel industry continues to fluctuate, the relationships between travel management companies and suppliers are even more critical.

Better business travel outcomes with strong supplier relationships

It’s all about who you know, even when it comes to corporate travel solutions . As a travel agency serving business , vacation and meeting and incentive travelers , having trusted supplier relationships with our vendors has a big impact on the customer experience. Here’s how strong travel supplier relationships can benefit travelers and corporate travel programs.

A trusted travel management system

What exactly is a supplier relationship in the travel industry? It’s an ongoing, dedicated relationship between a travel agency and a vendor. Whether it’s air, cars, hotels or tour operators, supplier relationships help travelers ensure they have the best travel contracts, vendor support and so much more.

At Fox World Travel, we have a team dedicated to nurturing existing supplier relationships and forming new ones. Thanks to their knowledge of the travel industry and advanced negotiation skills, this team excels at finding the best supplier fit for corporate travel programs.

“Our unique roles help you identify the best suite of preferred vendors at the most advantageous contractual terms,” says Mike Heck , Vice President of Supplier Solutions. “We know and understand the value of these supplier relations. It’s all about the three-way partnerships our team is able to build and nurture.”

University of Chicago Travel Manager Stephen Mitleider has first-hand experience utilizing Fox as part of his travel supplier strategy. Even with more than 40 years of travel management experience, partnering with his TMC is crucial in gaining a full picture of the market before making any decisions. “Due to typical confidentiality agreements, there aren’t many sources I’m able to benchmark against to understand the true value of the contract, so this is where I rely on my relationship with my TMC to be especially strategic and valuable,” says Mitleider. “My approach is to use the expertise and fact-based advice from Fox’s supplier solutions team to get the best contract for the University of Chicago travel program. I couldn’t do that without the help of my TMC.”

Four ways supplier relationships improve business travel development

The partnerships we have built with suppliers offers many benefits to travel managers and travelers that they may not otherwise experience. From contract negotiations to traveler support, here’s why strong supplier relationships matter to your corporate travel program.

1. Trusted Advisors

With more than 60 years in the travel industry , Fox World Travel has a long history of working with air, car, hotel and other travel suppliers. Fox understands the offerings of trusted suppliers and knows the client’s needs. The supplier solutions team works throughout Fox to ensure the entire team is familiar with preferred vendors. This combined knowledge of preferred vendors and company travel requirements results in the best possible corporate travel solutions.

2. Fair contracts

Fox assists customers during contract negotiations by supplying the right information to make the best vendor decisions.

“We analyze vendor trends to ensure our customers are getting the best contracts,” says Heck. “It’s a constantly evolving marketplace and it’s our job to identify the changes and how they impact our customers.”

3. Contract maintenance

Signing an agreement is just the beginning of the vendor-customer relationship. It’s important to nurture the relationship through regular communication and performance tracking. Fox provides opportunities for vendor – customer interaction through conference calls and meetings where performance is reviewed. “Regular communication and performance analysis is key to success of any new or existing program,” says Heck.

4. Travel support

With more than 100,000 domestic flights daily, disruptions occur that negatively impact the traveler experience. Fox understands the importance of the vendor relationship to support the individual traveler. “Our strong vendor relationships allow Fox to assist in speeding the service recovery process,” says Heck. “The key is knowing who to call and when to call them.” With strong vendor relationships, lines of communication are always open, giving the opportunity to discuss and improve when negative experiences occur.

Finding the right fit

“We know what’s important to your company travel program , and we will find the perfect supplier to fit those priorities,” Heck says. “We trust our vendors and know our ongoing relationships with them ultimately benefit the travel program.”

Our supplier solutions team is ready to work with you to provide proper corporate travel solutions and develop vendor relationships to drive success. It’s time to expect more.

Vice President, Supplier Solutions

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Ukraine-Russia war: Latest updates

Follow our Ukraine war live page for all the latest developments and analysis of the conflict. Listen to a Daily podcast episode on the notion of the UK putting troops on the ground in Ukraine as you scroll.

Monday 15 April 2024 18:50, UK

• The big picture: What's happening with the war as we enter a new week?
• Your questions answered: Is it too late to save Ukraine?

Good morning, and welcome to our overview of the war between Russia and Ukraine as it rolls into another week.

The big news of the weekend came from the Middle East as Iran launched a significant missile and drone attack on Israel. Volodymyr Zelenskyy condemned the attack and said Ukraine knows "very well the horror of similar attacks by Russia".

Meanwhile, a Kremlin-installed official in the southern Zaporizhzhia region said 16 people were killed in an attack on the occupied town of Tokmak, which Russia has blamed on Ukraine. Two  people were also killed in a separate shelling in the Russian-occupied Kherson region.

While our live coverage remains paused, we've zoomed out to give you the bigger picture of the war today.

The frontline

Concerns appear to be increasing that Ukraine's defences may be at risk of collapse in the face of a new Russian assault. 

Sources in numerous media outlets over the past couple of weeks have raised this fear as Ukraine is facing shortages of both manpower and ammunition, and appears outmanned and outgunned on the battlefield.

Western officials told Bloomberg the country is now at its most fragile moment since the war began. 

Ukraine's military chief said on Saturday that the battlefield situation in the east had "significantly worsened in recent days" and that Moscow had ramped up its assaults since Vladimir Putin extended his rule in the Russian presidential election.

Reports also suggest Ukraine's second-largest city, Kharkiv, could be among the targets for a renewed Russian assault. 

Kharkiv has faced intense bombardment from Russia in recent months, coming under fire from S-300 ballistic missiles and glide bombs, and was the target of repeated attacks last week. 

The city is not the most likely target of a fresh assault, media reports say, but Russian news outlets have raised the prospect. 

'Massive strikes' on energy infrastructure 

Overnight into Thursday saw a huge assault on Ukraine's energy infrastructure, with 40 missiles and 40 drones reportedly sent into the country by Russia. 

A thermal power plant just outside Kyiv was completely destroyed and went up in flames, while 200,000 residents in Kharkiv were left without power. 

Vladimir Putin later said he had been "obliged" to attack Ukraine's energy infrastructure after Kyiv conducted attacks on Russian oil refineries.

Attacks at Zaporizhzhia nuclear plant

Russia accused Ukraine of attacking the Zaporizhzhia nuclear power plant in a series of drone strikes over three days. 

The attacks at the Russian-occupied plant began on 7 April, with the roof of reactor 6 damaged. 

Ukraine has repeatedly denied involvement and said it would never target a nuclear facility, suggesting Russia was behind the attacks.

The UN's nuclear watchdog, the IAEA, has warned the "reckless" attacks "significantly increase the risk of a major nuclear accident". 

It has not said who it believes is behind the attacks. 

Civilian casualties increase sharply

The UN recorded a dramatic increase in civilian casualties in Ukraine in the last month. 

At least 57 children were killed or injured in March - double the number in February - as Russian forces stepped up their attacks. 

The UN Human Rights Monitoring Mission said it had verified at least 604 civilians killed or injured in Ukraine in March, a 20% increase from the previous month. 

"The March increase in civilian casualties was mainly due to attacks by the Russian armed forces using missiles and loitering munitions across Ukraine and increased aerial bombardments near the frontline," the Rights Office said.

It followed warnings from Volodymyr Zelenskyy that Ukraine country could run out of air defence missiles if Russia keeps up its intense bombing campaign. 

On Saturday, Uk

At least 10 people, including children, have been killed by shelling in a Russian-occupied town in Ukraine's southern Zaporizhzhia region, a local Kremlin-installed official said.

International diplomacy

In a rare meeting between a head of state and a minister, Chinese President Xi Jinping met Russian foreign minister Sergei Lavrov for talks on Monday. 

The pair met in the Chinese capital, where they pledged to strengthen communication. 

It was also a big week of diplomatic talks for the UK foreign secretary, who headed to Washington to appeal to Congress over the stalled multi-billion-dollar aid package for Ukraine. 

Lord Cameron made what was seen by some as an unusual trip to visit Donald Trump in Mar-a-Lago - likely because Republicans blocking the aid bill in the House of Representatives are aligned with Mr Trump. 

The foreign secretary was tight-lipped about what was discussed afterwards, saying the pair had "discussed a range of important geopolitical subjects". 

While live coverage of the war remains paused, here's a quick round-up of the key updates: 

• Two people were killed by Ukrainian strikes on the Russian-held parts of Kherson, the Moscow-installed regional governor said;
• Russia's defence ministry said its air defence systems destroyed 10 Ukraine-launched drones over the Krasnodar region in southern Russia and five drones over the Black Sea overnight; 
• Ukraine similarly claimed to have downed 10 Russian drones;
• The death toll in Zaporizhzhia from yesterday's attack, which Russia blames on Ukraine, rose to 16;
• President Zelenskyy condemned last night's attack by Iran on Israel.

While we haven't been able to bring you live updates today, we have been keeping an eye on what's been happening in the Ukraine conflict. 

Here's a quick round-up of the key updates so far: 

A Ukrainian rocket also struck a machine-building plant in Russian-occupied Luhansk in eastern Ukraine, injuring three civilians, according to Moscow-based official Vladimir Rogov.

Meanwhile, Russia has claimed to have taken a village in Ukraine's Donetsk region. 

Russia's defence ministry said the capturing of Pervomaiske had improved its tactical position on the frontline. 

Ukraine's army chief has also warned the situation on the eastern front had deteriorated in recent days, with Moscow's forces intensifying its armoured assaults. 

Colonel General Oleksandr Syrskyi said battles were still raging for control of a village west of the devastated Bakhmut - an area that has seen some of the bloodiest fighting throughout the war.

We'll be back tomorrow morning with more updates on the war in Ukraine.

Two Biden administration officials have revealed the extent of China's involvement in Russia's war on Ukraine.

The officials spoke to Reuters news agency and said China has massively increased its sales to Russia of machine tools, microelectronics and other technology to Moscow.

These items are important because Russia is using them to make tanks, aircraft, missiles and other weapons for the war.

They also said:

• About 90% of Russia's microelectronics came from China
• Nearly 70% of Russia's approximately $900m in machine tool imports in the last quarter of last year came from China
• Chinese and Russian entities have been working together to make drones in Russia
• China is helping Russia improve its satellite and other space-based capabilities for use in the war. This could increase the threat Russia poses across Europe

US President Joe Biden has previously raised concerns with Chinese President Xi Jinping about Beijing's indirect involvement in the war.

US Treasury Secretary Janet Yellen returned this week from a visit to Beijing and said she had warned China that the Biden administration was prepared to sanction Chinese banks, companies and Beijing's leadership if they helped Russia's military in the war.

She has already been given the go-ahead from Mr Biden to sanction financial institutions that help Russia's military-industrial complex.

US Secretary of State Antony Blinken is due to travel to China for talks next month.

Russia, increasingly isolated economically and diplomatically, has become more reliant on China in recent months.

One official said Chinese materials are helping Moscow undertake its "most ambitious defence expansion since the Soviet era and on a faster timeline than we believed possible early on in this conflict".

"Our view is that one of the most game-changing moves available to us at this time to support Ukraine is to persuade the PRC (China) to stop helping Russia reconstitute its military industrial base. Russia would struggle to sustain its war effort without PRC input," the official said. 

Chinese Embassy spokesperson Liu Pengyu told Reuters that Beijing has not provided weapons to any party and that it is "not a producer of or party involved in the Ukraine crisis".

"We urge the US side to refrain from disparaging and scapegoating the normal relationship between China and Russia."

If Russia defeats Ukraine it will be a "turning point in history", former UK prime minister Boris Johnson says.

Writing in the Daily Mail, he criticised Western countries for not providing Ukraine with the weapons it needs to defeat Russia.

"Every week in which we fail to do the obvious — and give the Ukrainians the weapons they need — is a week in which Putin gets closer to his disgusting ambition, to torture a European country to death.

"Every day the pressure on the Ukrainians is growing — and yet the solution is within our grasp."

Mr Johnson, who visited Ukraine a number of times during his premiership, said: "A defeat for Ukraine would usher in a new era of fear in the whole Euro-Atlantic area, as Putin continues his drive to rebuild the Soviet empire: from the Baltics to Georgia to Moldova to Central Asia to the Arctic.

"It will be a terrifying moment for the people of Taiwan and the clearest possible signal to China that the West has lost the willpower to protect democracy.

"It will be a turning point in history, the moment when the West finally loses its post-war hegemony, the moment when borders everywhere are suddenly up for grabs and aggression is seen to pay — and all because of a failure to stand up for Ukraine."

Mr Johnson warned the world is "on a knife-edge, with a real risk that Western democracies are about to be humiliated, and autocracies emboldened around the world — because of our lassitude, our pathetic refusal to do what is necessary".

He said Ukraine is so short of shells that its troops sometimes have to wait under Russian bombardment because they can't fire back.

The shortage of air defences means Kharkiv, the second-largest city, is "in danger of being turned into another Mariupol", he added.

Ukrainians were able to intercept 90% of incoming strikes, he said, but now "we are starving them, for reasons I do not understand, of the protective shields they need".

Mr Johnson called on the US Congress to approve a $60bn military aid package earmarked for Ukraine and on the Germans to supply Taurus missiles.

The West - including Britain - needs to "snap out of our sleep-walk", he said, adding: "The simplest and most cost-effective way to defend freedom is to invest now in the defence of Ukraine."

Rescue workers in Ukraine have saved five puppies from under the debris of a destroyed building.

The non-residential building was on fire in the north-eastern city of Sumy, close to the border with Russia.

A video from the State Emergency Service of Ukraine showed the firefighters cuddling the squealing puppies and rinsing them off with water.

In a post of the emergency service's Telegram channel, officials said the "little ones" were not injured.

"This rescue story reminds us of the importance of human compassion and the willingness to help everyone, regardless of the circumstances," they added.

Ex-armed forces minister James Heappey has told Sky's defence and security editor Deborah Haynes the UK should consider sending its forces to Ukraine to train troops.  

On the Sky News Daily, host Tom Cheshire talks to her and Sky's military analyst Professor Michael Clarke about the interview with Mr Heappey, who stepped down from his role last month.  

They assess the bleak situation in Ukraine and why the conflict is at a critical stage. They also discuss how prepared the UK would be if it faced a war in the near future.

A former Ukrainian secret service employee has been injured in Moscow after a device under his car exploded.

Vasily Prozorov suffered leg injuries that are not considered life threatening after the device detonated as he tried to start his car, Radio Free Europe cited Russian media as saying.

According to RFE, Mr Prozorov worked for Ukraine's SBU until 2018.

The following year, he told media in Moscow that he had collaborated with Russia "for ideological reasons" from April 2014 until he left the SBU.

These photos show the damage to a thermal power plant in Kharkiv, eastern Ukraine.

A massive missile and drone attack destroyed and damaged a number of power plants across Ukraine overnight, part of a renewed Russian campaign targeting energy infrastructure.

The Trypilska plant, which was the biggest energy supplier for the Kyiv, Cherkasy and Zhytomyr regions, was struck numerous times, destroying the transformer, turbines and generators.

Vladimir Putin said the attacks were a response to Ukrainian strikes that targeted Russian oil refineries.

In Kharkiv, there were at least 10 other strikes on energy infrastructure, resulting in damage like that seen in these photos.

Ukraine's foreign minister Dmytro Kuleba said more than 200,000 people in the region were without power.

Herman Halushchenko, its energy minister, said it was a "large scale, enormous, missile attack that affected our energy sector very badly".

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