OFT says online hotel deals broke law

31 July 2012

expediaTrouble is afoot in paradise as two online travel agents and a hotel group could be breaking the law by limiting price competition on room sales, according to the OFT. Booking.com and Expedia did separate deals with Intercontinental Hotels Group (IHG) and the regulator's initial findings suggest that these agreements infringed competition law.

Expedia think otherwise, saying: "Expedia remains committed to ensuring that it provides consumers with the widest possible choice of travel options at competitive prices and will seek to safeguard its ability to continue to do so in relation to the current regulatory process."

IHG meanwhile, have noted that arrangements with online booking agents were "compliant with competition laws and consistent with the long-standing approach of the global hotel industry".

This investigation kicked off in September 2010 after Skoosh.com complained that it was being pressured to maintain a standard price rather than share its commission with customers, and findings from the OFT suggest that certain agreements could indeed, limit price competition and create barriers.

OFT added: "We want people to benefit fully from being able to shop around online and get a better deal from discounters that are prepared to share their commission with customers. The OFT's provisional view is that Booking.com, Expedia and InterContinental Hotels Group have infringed competition law. However, these are the OFT's provisional findings only. All parties will now have a full opportunity to respond."

TOPICS:   Travel   Consumer Advice

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