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Japan's ongoing nuclear crisis poses a unique challenge to
the country's meetings and hospitality industries. With no current indication
of a resolution to the disaster, triggered by an earthquake and tsunami that
wrecked large portions of Japan's northeast coast, or any concrete assessment
of its ultimate radiological effect, corporate buyers and executives must weigh
the area's viability as a travel and meeting destination despite the abundance
Business travel to Japan outside the areas directly affected
by the earthquake is possible and occurring. Authorities have downplayed the
risk of exposure outside a 20-kilometer evacuation zone around the reactors,
and the World Health Organization is "not advising general restrictions on
travel to Japan," though it suggests avoiding areas where disaster relief
continues. International flights, albeit a reduced number, are arriving at
Tokyo Narita International Airport. Many, though not all, hotels are open.
"The difficulty here is that it is still possible to
get to Tokyo or other areas, but is it practical?" asked Jonathan Howe,
senior and founding partner of law firm Howe & Hutton. "No, without
knowing the penumbra of the radiation factor. It's the great unknown. If I'm a
planner, for at least the next year, I'm in conversations as to what you're
going to do. I'm not sure you'll be able to convince management and people to
At insurance firm Aflac, which has significant Japanese
operations, there have been no corporate directives regarding travel to the
country. "It's not really for me to make that determination," said vice
president of travel, meetings and incentives David Nelson, adding that
employees from the United States had resumed travel to Tokyo. "We've got
about 60,000 agents in Japan and several thousand employees who we're in daily
contact with. At the same time, we have our eyes and ears open to any State
Department alerts and keep that in the back of our minds.
Regardless of the actual health risks, the radiological
situation weighs heavily on many meeting planners and attendees. "Conditions
in Japan are significantly affecting the meetings industry, because of actual
conditions on the ground and because of unfounded concerns that materially affect
people's willingness to travel to Tokyo," according to Joshua Grimes,
hospitality industry attorney and managing partner of Grimes Law Offices.
"Meeting planners need to consider their attendees and whether they would
still be willing to travel to Japan and make a determination as to whether
their meeting can realistically go forward."
Impact On Facilities,
Some hotels in Japan are closed or limited their operations.
Hospitaliy consulting and research firm STR Global's HotelNewsNow reported that several properties in Sendai, the major
city closest to the earthquake's epicenter, are not open to guests. These
include the Hotel Monterey Sendai, Hotel Monte Hermana and JAL City Sendai,
which all have stopped taking bookings as they assess necessary
rehabilitations. Starwood's Westin Sendai also closed because of a lack of
utilities in the city, though the property itself sustained no structural
Closings also have occurred outside of Sendai. The
Shangri-La Hotel Tokyo has stopped accepting guest and notes on its website
that "bookings will resume as soon as the energy supply and normal hotel
operation can and has been restored." Rooms at the Tokyo Disney Resort
complex also are closed, as is the adjacent Sheraton Grande Tokyo Bay, though
other hotels near the park are open with limited operations, according to STR
Meetings scheduled at tsunami-damaged or otherwise closed
properties could be canceled or rescheduled under contractual force majeure
clauses, but events scheduled at operating hotels in Tokyo or elsewhere outside
an evacuation zone around the damaged nuclear facilities probably don't have
the same protection, according to Grimes.
"A force majeure event is an occurrence outside the
control of the contracting parties that makes the event impossible or illegal
to hold," according to Grimes. "In this situation, no credible health
authorities have determined that people should not travel to Tokyo or any area
outside the immediate radius of the incidents."
Grimes added that potential new developments—a significant
worsening of the radiological situation that led to power or food shortages or
severely reduced air service to Tokyo—conceivably could constitute a force
Still, it isn't certain hotels outside the evacuation zone
would seek contractual damages should business seek to cancel or postpone
meetings, Howe suggested. "They'll probably work with you to cancel the
meeting and look for some future opportunities when the air clears and it's
perceived to be a safe place to go," he said. "I daresay the hotels
are going to be forgiving. They're pragmatic, and will want to do the right
thing. The question is, what is the right thing?"
Grimes noted that it's "good business … given current
conditions" for hotels to allow meeting postponements "without
liability, irrespective of contractual commitment." He added that
"this is why many event planners negotiate expanded force majeure clauses
into their contracts, so that occurrences that make it 'impractical' to go
forward with an event also allow cancellation without liability."
A Starwood Hotels and Resorts Worldwide spokesperson said
that while Tokyo occupancy is low, hotels in southern Japan currently have high
occupancy as people move southward and foreign companies relocate employees and
their families. The spokesperson also noted that Tokyo hotels "are
prepared for airborne radiation and will be able to react quickly to any
As Japan's tragedy continues to unfold, assessments of the
country's long-term viability as a meetings destination are likely premature,
at least until the full impact of the nuclear situation is understood. Until
then, though, some planners will look elsewhere.
"We certainly have proposals for Asia/Pacific, and
Japan in particular, that will assuredly be eliminated from consideration,"
BCD Meetings & Incentives president Scott Graf told Incentive, which like BTN
is a Northstar Travel Media publication. "In the short term, people
considering this part of the world will wonder, 'What if we have the same
problem as last year or two years ago?' With so many wonderful options around
the world, they may choose to look elsewhere. People will want to support the
region, but there will be some period of time when that doesn't happen. There
will have to be a very clean bill of health before clients will bring it up
Barring any worsening of the nuclear situation, however,
business travel likely will continue as long as flights continue and hotels
remain open. "Moving forward, it's just too important to cut back in
travel back and forth to Japan," Aflac's Nelson said. "In the short
term, perhaps there was a dip in travel, but in the long term it will be
business as usual."
Michael B. Baker contributed
to this report.