Spain Fines Booking.com $446 Million For Unfair Commercial Practices
Spain’s CBNC fines Booking.com €413 million ($446 Million)
Allegedly, Booking.com forces hotels to offer their rooms at the lowest price on their platform. Moreover, this is while the travel website reserves the right to undercut those prices themselves. On top of that, disputes were subject to Dutch law and courts, placing Spanish hotels at a disadvantage.
Manipulating hotels
The CNMC investigation revealed that Booking.com had used tactics to discourage hotels from using other online travel agencies. Meanwhile, this included favoring hotels in search results based on their total Booking.com bookings. Moreover, they also prioritize hotels in loyalty programs based on their profitability for Booking.com and not necessarily for the hotels themselves.
Euro Weekly News quotes the CNMC as saying these practices limit the hotels’ ability to offer competition prices on their own websites. Moreover, they allegedly prevent other OTAS from gaining a foothold in the market. Meanwhile, it says this ultimately hurts consumers who might miss out on better deals.
Booking.com is a unit of New York-listed Booking Holdings and since 2019, has been taking advantage of its 70 percent to 90 percent market share to impose unfair conditions on hotels.
In 2022, Reuters reported that a Spanish competition watchdog had launched a probe into the travel website. At that time, the CNMC found “reasonable grounds” to believe the online travel website may have infringed Spain’s antitrust laws, including Article 102 of the Treaty on the Functioning of the European Union. That article bans companies from abusing a dominant market position.
Meanwhile, the fine breaks down to €206.62 million for each violation and sends a strong message to Booking.com and other dominant online platforms. With its ruling, CNMC aims to create a fairer marketplace where hotels can freely offer competitive rates. Moreover, it aims to give consumers access to a wider range of travel booking options.
Booking Holdings to appeal the fines
According to a spokesperson for Booking Holdings who responded by email, it intends to appeal the fines, as it strongly disagrees with the “outcome of CNMC’s investigation.” Moreover, it added that it believes the issue should be debated under the European Union’s Digital Markets Act rules.
Meanwhile, the CNMC said the group can appeal the fines in the Spanish high court. The group can appeal the fines in Spain’s high court, CNMC said. Furthermore, the proceedings stemmed from two complaints filed by the Spanish Association of Hotel Managers (AEDH) and the Madrid Hotel Business Association back in 2021. Meanwhile, the proceedings send out a strong message to all online platforms.
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