Exactly Who Owns YOUR Travel Biz?

Just before Christmas, we reported that it seemed YTB was changing their name to CTB. We reviewed the document and all we can say (in the immortal words of Rick Ricketts---Wow!, Just Wow!) As I mentioned before, if you are interested to see the 49 page documement that replaced the 6 page one, please send me an email.

To any of the YTB Affiliates, RTAs, or soon to come "Travel Agents" reading this blog, I suggest that you take this document to your attorney and get advice. One thing you need to know is that YTB reserved the right to change the terms (at their whim) when you originally signed up. By continuing to participate in the program, you are essentially agreeing to the new terms. Please get some professional advice, it will be the best $100 you ever spend.

With a 49 page document, you can imagine that there are a lot of issues. I will discuss (by page) the ones that seem the most critical to me.

• Page 7. CODE OF ETHICS. While they say that the founders of YTBTN have strong convictions, it does not seem to flow outward to the TSOs. There are still all sorts of questionable behavior and promotion going on. I feel that YTBTN does not care, until it becomes an issue.
• Page 9. Section 1.4 DELAYS. This is a frightening section as it allows YTBTN to default on any payments owed to the TSO for any number of reasons. Notably, government decrees or orders.
• Page 10. Section 2.1REQUIREMENTS TO BECOME AN AFFILIATE. It states to become a "Travel Agent" you must complete, enroll, and pay for ALL E-Campus modules. Currently there is no timeline for when all the modules will be available. Is YTB certifying people as "Travel Agents" when they complete only those available?
• Page 11. Section 2.4 GENERAL RESPONSIBILITIES OF A TRAVEL SITE OWNER. Section "b" prevents you from engaging any supplier in a dispute. Honestly, this is what agents do for their clients. Section "c" prevents you from advertising any trips online.
• Page 12. Section 2.6 TALENT RELEASE. I am not sure I woudl be willing to give YTBTN "lifetime" rights to my images, thoughts, and statements.
• Page 13, Section 3.2 ADVERTISING. This section precludes a TSO from using any promotional materials that were not produced by YTB. It further clarifies it that TSOs are not allowed to produce their own literature, ads, sales aids, promo materials, or internet web pages.
• Page 14. Section 3.3 INTERNET WEBSITES AND E-MAIL COMMUNICATIONS. This section says that the ONLY internet web page that you can use is the replicated site provided by YTBTN. TSOs are not allowed to design any other web site that that uses the YTB name, logos or promotes YTB either directly or indirectly.
• Page 15. Section 3.5. BLOGS, CHAT ROOMS, SOCIAL NETWORKS, ONLINE AUCTIONS, and OTHER ONLINE FORUMS. This prevents you from utilizing any blogs (Doug are you listening?), chat rooms, or essentially ANY internet means to to "market, sell, advertise, promote, or discuss YTBTN's products or services. Say goodbye to commenting on this blog by name, signatures on forums, the YTB room in WAHM, the YTB Family Ning Forum, all blogs and essentially all websites owned by TSOs that mention YTB.
  
• Page 15. Section 3.6 DOMAIN NAMES AND E-MAIL ADDRESSES. Gone are the days of having YTB featured in any of your email addresses or domains.
• Page 19. Section 3.16 CONFLICTS OF INTEREST NON-SOLICITATION. TSOs are not allowed to recruit other people from YTB or their customers into any other MLM company. Further, you are not allowed to recruit or solicit anyone in YTB or their customers for a year after you leave. This might actually make you an employee. Does not sound too independent to me.
• Page 20. Section 3.16 CONFLICTS OF INTEREST NON-SOLICITATION. You are not allowed to sell any competing products. With the addition of the lotions and potions and so forth, it seems that YTB is competing everywhere. And then there is the crazy (section "c") requirement about talking about other network marketing opportunities within 2 hours or 5 miles of any YTBTN event.
• Page 20. Section 3.18 GOVERNMENTAL APPROVAL OR ENDORSEMENT. Well, it is apparent that the California Attorney General is not endorsing YTB any time soon, but how may recruiting meetings have taken place where they say that YTB is legitimate and has been approved and been registered with "the Attorney General in all 50 states"?
• Page 21. Section 3.20 INCOME TAXES. Well, with the average TSO earning $139 a year in income, I suspect YTBTN saves a lot of money on printing these 1099s.
• Page 21, Section 3.21 INDEPENDENT CONTRACTOR STATUS. From a lot of the other rules in this document, it seems that you are not that independent at all. I also find it interesting that they state you are not buying a franchise or a business opportunity. What is the opening line of every YTB presentation--we offer two separate "business opportunities"?
• Page 21. Section 3.22 TRAVEL SITE OWNER'S NAME. You cannot advertise that you are part of YTB in the phone book nor are you allowed to answer the phone like you are part of YTB. Hopefully, little Timmy will not answer a ringing phone, "Hello, YTB Travel"
  
• Page 23. Section 3.24 CONFIDENTIALITY. This is the most frightening page in the document for any one that is interested in selling travel. It specifically states that your customer information is the "exclusive property" of YTBTN. So, you work hard and find customers and YTBTN takes them from you and then owns them. Of course clients will do what they want, but EVERY other legitimate host has a provision that states that the clients belong to the agent. But you can be sure that if you leave, YTBTN will be marketing to your clients very heavily.
  
• Page 26. Section 4.8 SALE, TRANSFER OR ASSIGNMENT OF TSO'S BUSINESS. While the concept of someone actually selling this "business" is amusing in an of itself (I mean why would you not just buy a new one on sale for $250?), there is a clause to protect the upline at all costs. Also notable is the the clause that requires the purchaser to assume "all" obligations. I am not sure how YTBTN can legally require that a buyer assume all obligations. Most business sales are typically asset only transactions; liabilities remain with the seller.
• Page 30. Section 5.2 NON-DISPARAGEMENT. This says you are allowed to talk nice of YTBTN, but if you discover something that you disagree with, they will not address it at all. You are simply not allowed to voice any concern if they feel it is negative.
• Page 31. Section 5.4 VENDOR CONFIDENTIALITY/COMMUNICATIONS. You are no longer allowed to divulge the commission levels paid by vendors. So much for every recruitment presentation along with the examples.
• Page 32. Section 6.1 TRAVEL SALES. Customers must not be abandoned under any circumstances. (Unless they are in Atlanta and then that is ok because someone will step in). But my question is if YTBTN is serious about this, perhaps they ought to offer a method to contact the TSO on the websites. If you look at any site, there is still no way to contact the TSO and the minimal help offered still suggests to call the supplier directly for issues.
• Page 33. Section 7.1 BONUS AND COMMISSION QUALIFICATIONS. If you are not in COMPLETE compliance with all 49 pages of this document, YTBTN can elect to not pay you commissions or bonuses owed.
• Page 33. Section 7.2 ADJUSTMENTS TO BONUSES AND COMMISSIONS. This says that if the client cancels travel and the client is entitled to a refund, no commission will be paid. As any travel professional knows there are several instances where a client receives a refund and the commission is still paid.
• Page 34. Section 7.6 REPORTS. Apparently the big SAP program is not all that. Any reports not really guaranteed to be accurate. So if your client cancels and you do it through the Back Office, there is a possibility it might never make it.
• Page 36. Section 9.1 DISCIPLINARY SANCTIONS. This is a pretty extensive list and it seems they left out water boarding.
• Page 40. Section 10.2 SALES TAXES. I suspect (hope) this is a mistake, but this says YTBTN collects sales taxes on ALL transactions and remits them to the proper states. Well, many (if not most) states do not assess sales tax on travel. If YTBTN is collecting it, where is it going?
• Page 41. Section 11.1 EFFECT OF CANCELLATION. While most legitimate hosts will work with an independent contractor, YTBTN has refused to transfer any bookings. This further emphasizes that the clients do indeed belong to YTBTN.