December 8, 2016 #AskMeredith, Blog

Believe it or not, this is actually a pretty complicated question.  The answer is:  it depends.  Travel agents book through travel suppliers, and you need to have travel industry credentials to do that.  (Read more about that.)  The good news is that most travel agents belong to a host agency and use the host agency’s credentials, so you don’t have to worry about getting your own.

However, credentials are not the same things as a license and you may need one or more of those as well.   Whether or not you need a license to sell travel depends on where you live (or your business resides) as well as where you market and where your clients reside.  There are two types of licenses you need to be aware of:

1) Business Licenses:
Whether or not you need a business license depends on where you (or your business) reside, regardless of where your clients are.  If you aren’t sure about the rules in your state, start by contacting your state’s department of commerce.  Most likely they will have information online and a number you can call to talk to someone about state requirements.  There are resources online that will charge you a fee to do that work for you, but you can contact the state directly.  Also, check with your county and city as well because there may be business license requirements (in other words, fees you have to pay) at the local level too.  The state of Delaware requires an occupational business license that specifically pertains to travel agents.

2) Seller of Travel Licenses:
Whether or not you need a seller of travel license depends on where you (or your business) reside as well as where your clients reside (or where you are marketing to attract clients).  There are 5 states that have Seller of Travel licensing rules and you may be subject to one or all of them depending on your business.

  • Florida – Any agent who is located in Florida and/or advertises to or sells travel to a resident of the state of Florida MUST be registered with the state. Many travel agents  meet the criteria to file a Statement of Exemption under their host agency’s Seller of Travel license.  If not, you must independently obtain a Seller of Travel License.  Florida’s licensing process is probably the most complex, because it requires you to register your business in the state and obtain a bond.
  • California – Any agent who is located in California and/or advertises to or sells travel to a resident of the state of California MUST be registered with the state. Unlike Florida, most travel agents DO NOT meet the criteria to be registered under their host agency’s Seller of Travel license because California specifically precludes anyone who has an LLC or S-Corp from qualifying under the criteria.  If that is the case, you must independently obtain a Seller of Travel License.
  • Washington – Agents must be registered with the state of Washington Business Licensing Service before engaging in selling, or advertising to sell, travel services or travel-related benefits. Many travel agents meet the criteria to operate under their host agency’s Seller of Travel license.  If you do, you don’t need to file anything independently with the state.
  • Iowa: If you are based in Iowa or solicit business from Iowa residents, you must register with the secretary of state as a travel agency. Iowa does not offer an exemption for agents who are with a host agency, so you must register independently if the requirement applies.
  • Hawaii: Travel agents who reside in Hawaii or solicit business from residents of Hawaii must register with the Department of Commerce and Consumer Affairs. Like Iowa, Hawaii does not offer an exemption for travel agents who conduct business through a registered host agency so if the requirement applies, you must register on your own.

 

Once you have your bases covered with licenses, you need to take it one step further and make sure you comply with disclosure rules.  These states list specific disclosure requirements and they are different from state to state, so it makes sense to make sure that your website, client communications, etc. comply with all the relevant disclosure requirements.

Do you find this overwhelming?  If you own your own travel business, or are planning to start one, make sure you work with a host agency like Gifted Travel Network that will show you how to set up your business correctly and provide support to you as a business owner, not just as a travel agent.

By Meredith Hill