What happens if dcl goes bankrupt and we used dvc points to book?

[we"reofftoneverland]

We haven’t booked a cruise with points, but we are thinking about it. So, disney could spin off dcl and put it into bankruptcy, and I am thinking any points used to book a cruise would be lost, correct? I know most people on here will think I am nuts worrying about dcl going bankrupt but we owned GM stock because it would “never go bankrupt,” so I do think it’s a possibility. Especially now that the cdc (as of yesterday reiterating) is saying no sailings until November 2021. I anticipate they will push it back until they have destroyed the cruise industry. The cruise lines need to push back hard on the dictators at the cdc that’s for sure. But my optimism about life in general is on the downswing right now considering everything that has gone on over the last couple of months. So I am thinking don’t book with points, correct?

 

[Sandisw]

IMO, your points are returned as reservation points and you will be restricted to use by them for non DVC rooms.

When someone uses points outside DVC, the room goes with it to rent for cash to pay the cruise line. So, getting them back for DVC would not happen.

 

[Mickey of the Villages]

I think the chances of DCL going bankrupt are 0.0001% in the next 12 months. It's not a crazy thought - anything can happen. It's very very unlikely.

 

[_auroraborealis_]

Especially now that the cdc (as of yesterday reiterating) is saying no sailings until November 2021.

The Conditional Sail Order does not prohibit sailings until November 2021. It is a framework that requires various health and safety measures. Lines could be working right now to meet the requirements if they so chose.

I know most people on here will think I am nuts worrying about dcl going bankrupt but we owned GM stock because it would “never go bankrupt,” so I do think it’s a possibility.

From a bankruptcy law perspective, GM and DCL are apples and oranges. DCL is one division within the greater company, and is a part of DIS (NYSE). DCL is a small part of the overall revenues of the company, and not a huge part of the balance sheet. If DCL had to close shop tomorrow, DIS couldn't take it into bankruptcy to discharge the debts due to how it is structured within the overall corporation.

 

[Chris Ehlers]

Disney will never sell off its most profitable cash cow

 

[DVC Doctor]

I think the chances of DCL going bankrupt are 0.0001% in the next 12 months. It's not a crazy thought - anything can happen. It's very very unlikely.

I totally agree, this is not something to lose sleep over.

 

[_auroraborealis_]

It is basically legally impossible for DCL to go bankrupt and the parent company to weasel out of its financial obligations under current US code.

 

[drusba]

"Disney Cruise Lines" as named cannot file for bankruptcy because Disney Cruise Lines is simply the trade name for the cruise business that is actually owned by Magical Cruise Company, Ltd., an English corporation doing business in the US using the Disney Cruise Lines trade name. Magical Cruise Company, in turn, is owned by the Walt Disney Company,

If there were to be any bankruptcy, it would be one for the Magical Cruise Company. Moreover, as a foreign ccorporation what it might file in the US bankruptcy courts is subject to some varying rules from those applied to domestic US companies. It could possibly file a Chapter 7 (insolvency) or 11 (reorganization) bankruptcy, but could instead file in London under its bankruptcy laws and file an anciliary proceeding in the US under Chapter 15 (which acts as the mainly secondary proceeding to one taking place in another country).

In any event, under US laws,a bankruptcy could potentially result in your loss of the cruise and your loss of any points traded out for the cruise -- that trade out is considered a final transaction and DVC is not required to reimburse those points to you if the cruise line goes bankrupt and the cruises are all cancelled. The claim you have for any compensation is one to be made in the bankruptcy court. That does not mean DVC points cannot voluntarily be returned by DVC or even via an agreement or ruling in the bankruptcy court. Nevertheless, I would not be overly concerned with a bankruptcy in the near future. I would guess the probability of the cruise line going bankrupt to be lower than that of the Disney Parks and Resorts company, which has lost a lot more money than the cruise line, going bankrupt, and that probability is also very low.

 

[Evita_W]

Would the DVC trip insurance cover such an event as this? While I agree that it is unlikely to happen, these are things to think about.

 

[limace]

On the scale of things to keep you up at night, I’d let this one go. I’d be much more likely to lose sleep over the incredible waste of money involved in booking a cruise with points. Laying awake, thinking of the thousands of dollars I’d flushed away....

 

[Evita_W]

On the scale of things to keep you up at night, I’d let this one go. I’d be much more likely to lose sleep over the incredible waste of money involved in booking a cruise with points. Laying awake, thinking of the thousands of dollars I’d flushed away....

One time we were able to book a cruise where it worked out a substantially better deal to us points, about equal to half of the cash cost...not common though.

 

[Noodlez]

I have no idea about the chances of bankruptcy, but I just thought I should remind people that the CDC is only for the US. I'm a UK DVC member. I'm not sure if sharing a link would work, because from here the US links just direct to UK sites, so I assume it's vice versa. Anyway, the Disney Magic will start sailing from the UK this summer (along with Princess cruise lines and P&O). I would love to say it's because of our amazing vaccination program, but I also feel that we are the guinea pigs for the new measures!

I'll try this just in case https://disneycruise.disney.go.com/cruises-destinations/overview/uk-magic-at-sea/ but DCL will be sailing before November.

 

[Nabas]

I think the chances of DCL going bankrupt are 0.0001% in the next 12 months. It's not a crazy thought - anything can happen. It's very very unlikely.

Disney has nearly a billion dollars invested in each vessel. More invested in their facilities on Castaway Cay and Port Canaveral. Beyond the bad blood a bankruptcy would create, I can't image Disney walking away from these assets.

As you wrote, anything can happen and your 0.0001% prediction is spot on.

 

[we"reofftoneverland]

Hi all, thanks for all the input. Does anyone know if I put down a cash deposit on dcl— will they let me flip it to a point payment later?

 

[TiggerBouncy]

It is basically legally impossible for DCL to go bankrupt and the parent company to weasel out of its financial obligations under current US code.

This is not quite true.

"Disney Cruise Lines" as named cannot file for bankruptcy because Disney Cruise Lines is simply the trade name for the cruise business that is actually owned by Magical Cruise Company, Ltd., an English corporation doing business in the US using the Disney Cruise Lines trade name. Magical Cruise Company, in turn, is owned by the Walt Disney Company,

If there were to be any bankruptcy, it would be one for the Magical Cruise Company. Moreover, as a foreign corporation what it might file in the US bankruptcy courts is subject to some varying rules from those applied to domestic US companies. It could possibly file a Chapter 7 (insolvency) or 11 (reorganization) bankruptcy, but could instead file in London under its bankruptcy laws and file an anciliary proceeding in the US under Chapter 15 (which acts as the mainly secondary proceeding to one taking place in another country).

This is true. As a Limited company based in the UK, Magical Cruise Company can file under UK law. Under English Law, things are different than the US.

"As a matter of English law, a parent entity (domestic or foreign) of a limited company cannot be held liable for the debts of that subsidiary upon its insolvency unless it has contractually agreed to accept such liability.."

So if they file in the UK, they absolutely can "weasel" out of any bookings or debts.

Having said that, I do not see a world in which Disney would take the damage to their brand name by doing such a thing. First off, they are no where NEAR bankruptcy or getting rid of DCL. They love DCL. They are still proceeding with the Wish and it was one of the things that got a green light on continued capital expenditure. Second, if they DID cut off DCL, there is no way Disney would not refund booked trips. The damage to their rep would be unfathomable.