More input is being sought by the Office of Fair Trading into a probe into claims that Expedia and Booking.com colluded with InterContinental Hotels Group to restrict discounts on rooms.
Views sought on solution to Expedia/Booking.com hotel prices probe
More input is being sought by the Office of Fair Trading into a probe into claims that Expedia and Booking.com colluded with InterContinental Hotels Group to restrict discounts on rooms.
The OFT today opened a consultation on commitments proposed by Amsterdam-based Booking.com, Expedia and IHG designed to address its competition concerns over the online offering of room-only bookings by online travel agents.
The three businesses under investigation propose addressing the OFT’s concerns by giving formal commitments that would relax existing restrictions.
This would enable OTAs to provide discounts on the rate at which room-only hotel accommodation bookings are offered.
Under the proposed commitments, OTAs would be free to use their commission revenue or margin to fund discounts to consumers who meet certain criteria.
The proposals follow an OFT Statement of Objections issued last summer claiming that Booking.com and Expedia each entered into separate agreements with IHG which restricted each OTA’s ability to discount the rate at which room-only bookings are offered to consumers.
The OFT limited the scope of its investigation to a small number of major companies, with a view to achieving a swift and effective outcome.
But it said today that the investigation “is likely to have wider implications as the alleged practices are potentially widespread in distribution arrangements in the industry”.
Ann Pope, senior director in the OFT’s Services, Infrastructure and Public Markets group, said: “The OFT is consulting on whether these commitments offer an immediate and effective means of injecting some meaningful price competition into the online offering of room only hotel accommodation bookings where, in our provisional view, none may exist.
“Under the proposed commitments, OTAs would be able to offer discounts off hotel room bookings to qualifying consumers.
“The OFT would now like to hear the views of all interested parties before it makes its decision on whether to accept the commitments.”
A deadline of September 13 has been set for comments to be submitted to the OFT.
