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BP Business Economic Loss Claim Appeal 2015-147: Travel agency as tourism


The following is an Appeal Panel Decision issued pursuant to Section 6 of the BP Deepwater Horizon Economic & Property Damages Settlement Agreement and the Rules Governing the BP Appeals Process. Links may have been added to assist the reader. The original decision may be found here, as well as a glossary of BP Settlement terms.

Claimant is a travel agency located in Louisiana. There are two issues: (1) Claimant contends the Settlement Program erred in not designating it a Tourism Business, and (2) BP contends that the Settlement Program failed to reconcile discrepancies in bank statements and P&Ls on commission revenues.

As to the Tourism designation, BP argues that the Tourism category was created to cover businesses who cater to tourist who come to the Gulf of Mexico region, and as a travel agency located in the Gulf of Mexico region, Claimant helps people leave their communities. This is a novel argument, but not compelling. Exhibit 2 defines a tourism business one that provides services such as attracting, transporting, accommodating or catering to needs or wants of persons traveling to, or staying in, pleases outside their home community, i.e. helping them make arrangements to travel outside their home community wherever their home community is located.

Whether living elsewhere and traveling to Louisiana, or living in Louisiana and traveling elsewhere, the Claimant assist the travelers’ transportation needs. The Claimant is a member of the an association of businesses that cater to the needs of people traveling to Louisiana. The Claimant purchases travel agent and tour operators professional insurance because it functions in both capacities.

As to the commission revenues issue, comparing commission revenue (which takes into account the cost of what was sold) and cash receipts (which does not) is an apples and oranges comparison. For example, if a travel agency buys and sell a $1,000 cruise ($900 being the cost of the cruise and $100 the commission), $1,000 would be deposited in the bank, but the commission revenue would be $100 on the P&L. Thus, the Settlement Program was correct in computing the compensation amount but erred in not designating Claimant as Tourism.

Claimant’s Final Proposal is adopted.


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