Solvency of Cruise Lines

[greykitty]

I don't think it would hurt to check with the credit card companies about timing for any possible dispute, especially since NCLH has indicated in SEC filings that they're putting most of their fleet into cold layup, as well as exploring all sorts of financing options.  Short term liquidity for all the cruise lines remains a question in my mind, and solvency in general remains very cloudy in my crystal ball.  

[Pcardad]

They good for a year at least now....

 

https://www.fool.com/investing/2020/04/27/norwegian-cruises-stock-rises-as-it-details-half-a.aspx

[Dolebludger]

Well, perhaps and perhaps not. Social distancing on now overcrowded NCL ships will require significant physical changes be made to those ships. Granted, we don’t know what those requirements will be exactly. But I’ll bet the “moving mob” I saw not long ago on the NCL Pearl won’t meet them. 

[JMARINER]

3 hours ago, orvil said:

..............Until then, be very glad that you paid for your cruise with an credit card.  Credit card companies hold back a portion of funds from a company and watch that company's liabilities very carefully.  When the credit card companies start putting the screws to the cruise lines, you will know the end is nigh. ...........

You statement about "credit card companies holding back a portion of fund...", from where did you get that information. It certainly isn't true for retail and I have never heard that being applied to other services including travel.  Credit card companies usually make all funds available to the seller within 3 days.

 

Also, from the information I received form my credit card company, CitiBank, I have 60 day from the initial transaction charge to my card within which to dispute a charge. Additionally, they told me on the phone that I have no benefit if my "over 60 day" charge for a future cruise is cancelled because of the cruise-line bankruptcy. My only option in that event would be to look to my purchased travel insurance for coverage.

 

J

[Dolebludger]

JMARINER,

 

I don't know whether credit cards cover goods or services not furnished due to bankruptcy, but I suspect it differs from card to card. You need to ask for a copy of your contractual documents with your card, and make sure what you were told over the phone is correct. It may or not be.

 

If that information is correct, I believe that those who have paid for goods or services that were not delivered due to bankruptcy have a very high priority claim in the bankruptcy. It has a higher priority than even secured creditors and the IRS! But it is limited to (I think) $3200 per person.

[wristband]

Dole - customers who paid cruise fare, cancelled and await refunds...if there is a Chapter & or 11 bankruptcy filing, we would be classified unsecured creditors.  Which means we are at the back of the line. 

 

Secured creditors - lenders, banks, preferred shareholders, construction companies with liens - enjoy priority over consumers seeking refunds for their cruise fare.

 

If it should occur, the bankruptcy court (a federal judge) has jurisdiction over the company's business affairs, use of remaining cash to pay creditors, and must follow the statutory scheme which prioritizes the payment of payroll, vendors and creditors.

 

FYI: Chase Bank has the same 60 day window as does Citi on filing disputed claims on credit card charges. 

 

[rallydave]

4 minutes ago, wristband said:

Dole - customers who paid cruise fare, cancelled and await refunds...if there is a Chapter & or 11 bankruptcy filing, we would be classified unsecured creditors.  Which means we are at the back of the line. 

 

Not Dole but, have to be aware that all of the ocean cruise lines are foreign to US companies so no telling should they go under where they might file their bankruptcy so strong possibility will be in a foreign court so no way to answer your questing definitely,

[RJ2002]

1 hour ago, wristband said:

 

FYI: Chase Bank has the same 60 day window as does Citi on filing disputed claims on credit card charges. 

 

 

I am not disputing your information regarding Chase, but it seems across various CC forums, interest in the topic of credit card chargebacks is growing.  Over on the Silversea forum, one person has referenced this 869 page document related to VISA's rules.  On several threads over on Silversea, it has been noted that someone has 540 days from the date the original transaction was processed for disputes where a service was not received.

 

Even though I've got plenty of time on my hands, I have NOT reviewed this 869 page tome...  LOL

 

https://usa.visa.com/dam/VCOM/download/about-visa/visa-rules-public.pdf

[JMARINER]

30 minutes ago, RJ2002 said:

 

I am not disputing your information regarding Chase, but it seems across various CC forums, interest in the topic of credit card chargebacks is growing.  Over on the Silversea forum, one person has referenced this 869 page document related to VISA's rules.  On several threads over on Silversea, it has been noted that someone has 540 days from the date the original transaction was processed for disputes where a service was not received.

 

Even though I've got plenty of time on my hands, I have NOT reviewed this 869 page tome...  LOL

 

https://usa.visa.com/dam/VCOM/download/about-visa/visa-rules-public.pdf

Well, I read most of it. The 540 day look back is mentioned on page 700. (Starts at bottom of page 699.)

 

BUT. Caveat. This is an agreement between the the Issuer VISA and the Merchant and  not between the Issuer and the cardholder.  The agreement is meant to protect VISA not the cardholder, so the dates; the look back period does not apply to the current situation. The different agreement between the issuer, VISA and the cardholders has different terms and conditions, ie 60 days  Besides in a bankruptcy situation, who is VISA going to look to to get cardholder monies back from?

 

J

[RJ2002]

34 minutes ago, JMARINER said:

Besides in a bankruptcy situation, who is VISA going to look to to get cardholder monies back from?

 

 

Yes, that is the $10,000 question (or more).  I'd thought the same thing.

[SusieQft]

1 hour ago, RJ2002 said:

 

I am not disputing your information regarding Chase, but it seems across various CC forums, interest in the topic of credit card chargebacks is growing.  Over on the Silversea forum, one person has referenced this 869 page document related to VISA's rules.  On several threads over on Silversea, it has been noted that someone has 540 days from the date the original transaction was processed for disputes where a service was not received.

 

Even though I've got plenty of time on my hands, I have NOT reviewed this 869 page tome...  LOL

 

https://usa.visa.com/dam/VCOM/download/about-visa/visa-rules-public.pdf

Thank you for this interesting document.  (Well, it does have a few interesting tidbits in the haystack.)

 

p.689 "Invalid Disputes" --  "A Transaction in which the Cardholder cancelled the merchandise or service before the expected delivery or service date"

 

p.688, Europe only -- "For a Dispute related to non-receipt of travel services from a provider who has failed, if the services are covered by a bonding authority/insurance scheme, the Issuer must attempt to obtain reimbursement from the relevant bonding authority/insurance scheme., unless the bond or insurance scheme is insufficient. If the bond or insurance scheme is insufficient, the Issuer may use information in the public domain to initiate the Dispute."

 

p. 690 -- "A Dispute must be processed no later than either:  120 calendar days from the Transaction Processing Date  [or] 120 calendar days from the last date that the Cardholder expected to receive the merchandise or services" [Footnote]  "Not to exceed 540 calendar days from the Transaction Processing Date"

 

Assuming that JMariner is correct that this is a only contract between the issuer and the merchant, then this requirement may mean that they must complete processing of the dispute within that time frame, not that the customer has that long to file a dispute.  I did not see any date that explicitly says when the dispute must be filed (not to say it is not in there somewhere).

 

I'm sure there are other interesting tidbits, but that is what I found so far.

[flossie009]

I realise that the discussion about claiming from a credit card company is focussed on those guests resident in the USA.

 

For those in the UK, and for the interest of others, we are very fortunate to be covered by the Consumer Credit Act which makes the credit card company jointly liable for any default by the company who was due to provide the product or service:

 

http://www.theukcardsassociation.org.uk/individual/section-75-for-credit-card-purchases.asp

 

https://www.which.co.uk/consumer-rights/regulation/section-75-of-the-consumer-credit-act

 

 

[JMARINER]

2 hours ago, SusieQft said:

Assuming that JMariner is correct that this is a only contract between the issuer and the merchant, then this requirement may mean that they must complete processing of the dispute within that time frame, not that the customer has that long to file a dispute.  I did not see any date that explicitly says when the dispute must be filed (not to say it is not in there somewhere).

 

 

Page 49  states, in part; "....represents a binding contract between Visa and each Member [merchant]."

 

J

[Dolebludger]

Flossie, 

 

Yes the US is well behind the developed world in terms of consumer protection. And while we are US residents now, Canada is looking attractive it us.. 

Edited April 29, 2020 by Dolebludger

[mrlevin]

6 minutes ago, Dolebludger said:

Flossie, 

 

And while we are US residents now, Canada is looking attractive it us.. 

 

Then move.

[Dolebludger]

Because of all the confusion as to cancelation of cruises due to Corns virus and bans on cruising, one thing is clear to me. The cruise lines are waiting until the last minute to cancel, so that booked cruisers are tempted to cancel before the cruise line cancels.  If they do, the FCCs they get may well be worthless, if the line goes into bankruptcy. Or at least may be worth only about $3200. The cruise line’s delay in canceling is causing booked and fully paid guests to be involved in a problem they are not informed to deal with. Regent has cancelled all its cruises until the end of June. But the CDC has ordered them cancelled until late in July. Regent and other lines should cancel cruises as per CDC order, and not make those booked and fully  paid July cruises to“sweat it out”. We all know that there are no cruises going in as early as July, and why doesn’t Regent admit this as to all July cruises? I think Regent is trying to play “chicken” with those guests so they will take FCCs instead of a cash refund. And FCCs may be worthless, if there aren’t any future cruises. I analyze financials data a bit more harshly than others. I give NCLH a 0% chance of coming out of this without bankruptcy. If Regent cannot be somehow spun off, its FCCs will be close to worthless. So I must ask, are FCCs transferrable ? If so, I would like to buy some at a price of about 5 cents on the US dollar. But the way Regent is working now, I doubt that those FCCs are transferrable. But if they are, let me know!

Edited April 29, 2020 by Dolebludger

[scuba diver]

Interesting reading:

 

 

http://archive.fast-edgar.com//20200427/AA2ZOG2CZ22EWZZ2222T2ZE8FS49ZZ22NA22/

 

[Pcardad]

Stock prices have been rising the last few days since that release came out...I don't think many professionals are considering bankruptcy as a likelihood. The potential for profit from a private equity investor is too high. Or, like Carnival, they can raise $6B though the sale of bonds...moving them out of the woods. NCLH has about 12 months worth of cash right now at current burn rate...and that's a year in which to raise money. It will take them a couple of years to pull out of this but the people at US Trust and JP Morgan that I have spoken to are confident they will.

[cruiseluv]

2 hours ago, mrlevin said:

 

Then move.

Yes, and dont come back to USA for medical treatments

Edited April 29, 2020 by cruiseluv

[cruiseluv]

2 hours ago, Dolebludger said:

Because of all the confusion as to cancelation of cruises due to Corns virus and bans on cruising, one thing is clear to me. The cruise lines are waiting until the last minute to cancel, so that booked cruisers are tempted to cancel before the cruise line cancels.  If they do, the FCCs they get may well be worthless, if the line goes into bankruptcy. Or at least may be worth only about $3200. The cruise line’s delay in canceling is causing booked and fully paid guests to be involved in a problem they are not informed to deal with. Regent has cancelled all its cruises until the end of June. But the CDC has ordered them cancelled until late in July. Regent and other lines should cancel cruises as per CDC order, and not make those booked and fully  paid July cruises to“sweat it out”. We all know that there are no cruises going in as early as July, and why doesn’t Regent admit this as to all July cruises? I think Regent is trying to play “chicken” with those guests so they will take FCCs instead of a cash refund. And FCCs may be worthless, if there aren’t any future cruises. I analyze financials data a bit more harshly than others. I give NCLH a 0% chance of coming out of this without bankruptcy. If Regent cannot be somehow spun off, its FCCs will be close to worthless. So I must ask, are FCCs transferrable ? If so, I would like to buy some at a price of about 5 cents on the US dollar. But the way Regent is working now, I doubt that those FCCs are transferrable. But if they are, let me know!

Why let you know?? From what you've said you have no cruises booked on Regent, actually , you havent booked anything on Regent for a long time. 

 

 

[fizzy]

7 hours ago, cruiseluv said:

Why let you know?? From what you've said you have no cruises booked on Regent, actually , you havent booked anything on Regent for a long time. 

 

 

Actually, giving up U.S citizenship will finally work out well for Dolebludger re. Regent travel. No more dealing with domestic airline issues and the hordes.

[orvil]

JMariner,

 

To answer your question, I was involved with an airline bankruptcy.  It's been a few years, but as I recollect the credit card companies were first in line in a Chapter 11 because they were vitally necessary to a successful reorganization.  They will be protected before anyone else.  This is why you want to use a credit card and not a debit card, check or cash when you book travel.  It moves you out of the unsecured creditor class and into the 600 pound gorilla class.   Using the credit card provides you with the collective protection of a large, influential corporation in the case of default.

 

I know from personal experience that AmEx will put the screws to a merchant with gusto and never look back.  Visa/MC is not quite as aggressive but still formidable.

 

I used Visa to book my trip.  I mailed the dispute letter yesterday and referenced the fact that none of the customers who cancelled in the month and a half prior to me have received their requested refunds as evidence of bad dealings and failure to process in a timely manner.  I'll keep you advised of any developments, good or bad.  I still want to cruise.  I'm just standing up for myself.

[Dolebludger]

My last Regent cruise was only three years ago. It was a great one, but it was expensive. Not the sort of thing I do several times a year!  And we were looking at another one when the pandemic hit. In no way have we deserted Regent. We just hope Regent doesn’t desert us!

[Wendy The Wanderer]

9 hours ago, cruiseluv said:

Why let you know?? From what you've said you have no cruises booked on Regent, actually , you havent booked anything on Regent for a long time. 

 

 

7 minutes ago, Dolebludger said:

My last Regent cruise was only three years ago. It was a great one, but it was expensive. Not the sort of thing I do several times a year!  And we were looking at another one when the pandemic hit. In no way have we deserted Regent. We just hope Regent doesn’t desert us!

 

Cruiseluv, let's not start attacking people here because they haven't done any cruising for a while, okay?  Richard's been around the cruise scene for a long time.  And we haven't cruised Regent since 2017, nor cruised at all since 2018.

[Dolebludger]

One thing I posted about bankruptcy a good number of posts above is that consumers who paid for goods and services but did not receive them had a super priority up to $2500. I know as I was a bankruptcy attorney a few decades back. I don’t know if this is still the case, as my info is far from current.  If somebody on this board is a current bankruptcy attorney, pleas let us all know if this is still the case. It might be helpful to some.