With the upcoming holiday season, many South Africans have already made their holiday bookings in advance or are looking to secure last-minute accommodation. Consumers have various rights and protections, including the crucial right to cancel certain transactions. Regarding the cancellation of holiday accommodation bookings, Section 17 of the Consumer Protection Act 68 of 2008 (CPA) serves as a pivotal legal framework, outlining the rights and responsibilities of both consumers and accommodation providers. This article aims to illuminate the legal intricacies surrounding the cancellation of holiday accommodation bookings in South Africa and why a “no refunds” cancellation policy might actually be illegal.
Section 17 of the Consumer Protection Act
Section 17 of the Consumer Protection Act is headed “Consumer’s right to cancel advance reservation, booking or order”. It provides as follows:
(1) This section does not apply to a franchise agreement, or in respect of any special-order goods.
(2) Subject to subsections (3) and (4), a consumer has the right to cancel any advance booking, reservation or order for any goods or services to be supplied.
(3) A supplier who makes a commitment or accepts a reservation to supply goods or services on a later date may–
(a) require payment of a reasonable deposit in advance; and
(b) impose a reasonable charge for cancellation of the order or reservation, subject to subsection (5).
(4) For the purposes of this section, a charge is unreasonable if it exceeds a fair amount in the circumstances, having regard to–
(a) the nature of the goods or services that were reserved or booked;
(b) the length of notice of cancellation provided by the consumer;
(c) the reasonable potential for the service provider, acting diligently, to find an alternative consumer between the time of receiving the cancellation notice and the time of the cancelled reservation; and
(d) the general practice of the relevant industry.
(5) A supplier may not impose any cancellation fee in respect of a booking, reservation or order if the consumer is unable to honour the booking, reservation or order because of the death or hospitalisation of the person for whom, or for whose benefit the booking, reservation or order was made.
In short, you may cancel any advance booking at any time, but the accommodation provider may keep a reasonable deposit and charge a reasonable cancellation fee. Section 17 does not set a fixed cancellation window or a refund deadline. What it does is cap the fee at a fair amount, and it rules out any fee at all where the booking cannot be honoured because the guest has died or been hospitalised.
What Makes a Cancellation Charge Reasonable?
The test for a booking or reservation is the one in section 17(4) itself. Applied to holiday accommodation, these factors point towards a lower charge for a guest who cancels months in advance, for a period the establishment can readily re-let, than for a guest who cancels the day before arrival in peak season. A policy that keeps the full amount regardless of how much notice was given, or of whether the room was re-let, is open to challenge as exceeding a fair amount in the circumstances, and it can never be applied to a cancellation covered by section 17(5).
Section 14 of the CPA and Regulation 5 of the Consumer Protection Act Regulations (GN R293 in Government Gazette 34180 of 1 April 2011) deal with a different situation: cancelling a fixed-term consumer agreement. Regulation 5(2) lists the factors for a reasonable cancellation charge on a fixed-term agreement, and Regulation 5(3) provides that a supplier may not impose a charge that would have the effect of negating the consumer’s right to cancel a fixed-term agreement. Those provisions do not govern an advance booking under section 17.
The Five-Day Cooling-Off Period Applies Only to Direct Marketing
The right to cancel within five business days “without reason or penalty” is found in section 16 of the CPA, not section 17, and it applies only to a transaction resulting from direct marketing. The Act defines direct marketing as approaching a person, in person or by mail or electronic communication, to promote or offer goods or services. So if a supplier approached you and the booking resulted from that approach, section 16(3) allows you to rescind by notice in writing, or another recorded manner and form, within five business days after the later of the date the agreement was concluded or the date any goods were delivered. Under section 16(4) the supplier must then return your payment within 15 business days.
Section 16 does not apply where section 44 of the Electronic Communications and Transactions Act 25 of 2002 (ECT Act) applies. Section 44 gives a seven-day cooling-off right for many online purchases, but section 42(2)(j) of the ECT Act excludes it for “the provision of accommodation, transport, catering or leisure services” where the supplier undertakes to provide them on a specific date or within a specific period. A dated holiday booking made online therefore does not carry the ECT Act’s seven-day right, and its cancellation is governed by section 17 of the CPA.
NCC Guidance on Reasonable Cancellation Penalties
On 22 June 2023, the National Consumer Commission (NCC) issued Explanatory Note 4 of 2023, which explains when a cancellation penalty may or may not be imposed, by interpreting section 17 read with sections 19 and 21 of the CPA. The note makes two points:
- Where the decision to cancel rests solely with the consumer and nothing on the supplier’s part contributed to it, the supplier may charge a cancellation penalty, but it must not be unreasonable as measured by section 17(4).
- Where the supplier tenders to provide the services at a location, on a date or at a time other than as agreed, section 19(6)(c) allows the consumer to cancel without penalty. Read with section 21(9), the consumer is then entitled to recover the full amount paid, with interest from the date on which it was paid.
Summary of Consumer’s Rights
- Right to cancel: You may cancel any advance booking or reservation (section 17(2)). There is no fixed window within which you must do so.
- Deposits and cancellation fees: The accommodation provider may require a reasonable deposit and impose a reasonable cancellation charge (section 17(3)), judged by the nature of the booking, how much notice you gave, the provider’s ability to re-let, and general industry practice (section 17(4)).
- Death or hospitalisation: No cancellation fee may be charged if the booking cannot be honoured because of the death or hospitalisation of the person for whom it was made (section 17(5)).
- Changes by the provider: If the provider offers a different date, time or venue from the one agreed, you may cancel without penalty and recover what you paid, with interest (sections 19(6)(c) and 21(9)).
- Cooling-off: A five-business-day cooling-off right, with a refund within 15 business days, applies only if the booking resulted from direct marketing (section 16).
- Notice: Section 17 does not prescribe a form of notice, but cancelling in writing gives you a record of when you cancelled, which matters because the length of notice affects what charge is reasonable.
Understanding section 17, and how it differs from the cooling-off right in section 16, is crucial for both consumers and accommodation providers, as these provisions delineate the conditions for cancellation and ensure that any associated penalties or charges remain reasonable.
By understanding these provisions, both consumers and accommodation providers can navigate cancellations in a manner that is legally sound and fair. It is crucial for consumers to be aware of their rights, including how much notice they give and whether a cooling-off right applies, to make informed decisions and protect their interests when cancelling holiday accommodation bookings. Accommodation providers, in turn, must ensure compliance with the law to maintain transparency and uphold consumer rights in the realm of holiday reservations.
If you are unsure about your rights under the Consumer Protection Act, or if an accommodation provider is refusing to honour a cancellation, it may be worth seeking legal advice. For disputes that escalate beyond negotiation, understanding how a letter of demand works can be a useful first step before pursuing formal legal action through the civil court process.
Updated/Reviewed 24 March 2026 — Added reference to NCC Explanatory Note 4 of 2023 on reasonable cancellation penalties; added internal links to related articles. No legislative changes to Section 17 of the CPA since publication.
Updated 29 September 2026 – Corrected the statement of section 17 of the Consumer Protection Act: the provision previously quoted as section 17, a five-business-day cancellation right with a 15-day refund, is an inaccurate paraphrase of section 16, which applies only to bookings resulting from direct marketing; section 17 lets the consumer cancel any advance booking but allows a reasonable deposit and a reasonable cancellation charge judged by the section 17(4) factors, and bars any fee on death or hospitalisation. Removed a list of factors attributed to “Regulation 5(3)” that does not appear in the CPA Regulations (Regulation 5 governs fixed-term agreements under section 14), corrected the description of NCC Explanatory Note 4 of 2023 to what it actually says about sections 17, 19(6) and 21(9), and added that section 42(2)(j) of the ECT Act excludes dated accommodation bookings from the seven-day online cooling-off right.
