Whilst they may have the marketing slogan Booking.yeah Germany’s National Competition Regulator, the Bundeskartellamt says Booking.no!
Further to their January 2015 ruling that HRS’s ‘best price’ clause violated German and European competition law, the Bundeskartellamt, has today ruled that the OTA Booking.com (Deutschland GmbH, Berlin and Booking.com B.V., Amsterdam) should be prohibited from continuing to apply ‘best price’ clauses and ordered them to completely delete them from contracts and general terms and conditions by 31st of January 2016 – as far as they affect hotels in Germany.
The unfavourable conditions for hotels included obliging them to always offer the hotel booking portal their lowest prices, maximum room capacity and most favourable booking and cancellation conditions. During proceedings Booking.com had offered a modified ‘best price’ clause that allowed hotels to offer their rooms cheaper on other booking portals, but still requires that prices they display on their own websites may not be lower than Booking’s site – this was also rejected.
The full ruling can be read here, with Booking.com having the right to appeal against the Bundeskartellamt’s decision to the Düsseldorf Higher Regional Court and apply for interim relief against the immediate enforceability of the order, should they wish.
The European Impact?
Expedia is next on the Bundeskartellamt’s list, with proceedings underway against their ‘best price’ clauses. The wider impact on the European hospitality industry remains to be seen, but the Bundeskartellamt comments;
“The authority remains in close contact with the European competition authorities also conducting proceedings in this context and the European Commission and will participate in the coming year in an evaluation of different measures which the competition authorities have undertaken on the European hotel portal markets.”
Triptease, providers of price comparison tool ‘Price Check’ that allows hoteliers to show a price comparison of their rates versus OTAs were recently the centre of legal wranglings with Booking.com, with the OTA suggesting that their tool was “unlawfully accessing Booking.com’s data”.
Hotel Speak approached Charlie Osmond, Triptease’s ‘Chief Tease’ for comment on today’s Bundeskartellamt announcement;
“This is a great win for consumers as hotels now have the freedom to offer the best prices direct. Wunderbar!
The Bundeskartellamt (German Cartel Office) has made it clear that Booking.com’s contracts were anti-competitive, even the compromises that Booking put forward demonstrated no apparent benefit to the consumer.
We think there is a growing understanding among savvy travellers that hoteliers prefer direct bookers. We’re delighted that this ruling makes it possible for German hotels to incentivise direct bookings with lower prices.
We believe that Booking.com wants to restrict competition in the market. They’ve tried to prevent hotels from offering better deals direct and attempted to restrict price transparency.”