European OTAs declare Lufthansa GDS surcharge ‘manifestly illegal’

European OTAs declare Lufthansa GDS surcharge ‘manifestly illegal’

Eight leading European online travel agents (OTAs) have writtern to Lufthansa claiming the airline’s proposed GDS fee is “manifestly illegal” and a direct attack on the OTA business model.

The OTAs include, eDreams ODIGEO, e-Travel, Etraveli, Travelgenio, Travelplanet24, Travix and Unister Travel.

The move comes after the European Association of Travel Agents and Tour Operators (Ectaa) made a formal complaint to the European Commission.

Ectaa also believes it has a case against Lufthansa of abuse of its dominant position for levying the fee on routes such as Brussels-Frankfurt, Brussels-Zurich and Frankfurt-Zurich.

Ectaa president Lars Thykier, managing director of the Association of Danish Travel Agents and Tour Operators, said: “I’m quite sure we can find evidence of market dominance.”

The OTAs’ letter to Lufthansa states: The Lufthansa surcharge is manifestly illegal. The surcharge breaches the non-discrimination rules that apply to a parent carrier under the CRS Code of Conduct and also constitutes an infringement of EU competition law and equivalent provisions under national competition laws.

“Apart from the abusive nature of the practice, there are indications of a price fixing conspiracy among the airlines to impose a surcharge on OTAs. The surcharge also amounts to a breach of national commercial agency laws and unfair trade practices laws.”

The OTA group calls for the immediate abandonment of the surcharge, adding: “The surcharge which will be applied by the Lufthansa Group airlines will have a significant negative impact on consumers and the industry as a whole as it will limit choice, increase prices, reduce fare transparency and restrict agents in their ability to serve their customers.

“Lufthansa Airlines, when combined with its subsidiaries, is the largest airline in Europe, both in terms of overall passengers carried and fleet size. As such, the actions of Lufthansa have a very significant impact on the industry and consumers.

“The OTAs involved in this initiative jointly sell at least 25 million flight tickets per annum online, of which, they estimate, approximately four million Lufthansa Group tickets.

“The Lufthansa plan is a deliberate attempt to drive traffic direct to Lufthansa’s own website and channels and ignores the substantial benefits provided by OTAs which provide customers with transparent and comprehensive information of available flight offers beyond what is found on any one individual airline’s website.”

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