Online hotel booking investigation update

Online hotel booking investigation update

Here’s the latest in the Competition and Markets Authority (CMA) online hotel booking investigation that has been focused on consumer law compliance.

The initial investigation was launched back in October 2017, with enforcement action taken in June 2018. It’s an important one given the breadth of the online hotel booking market, and how confusing it can be. Competition in this key sector should always be healthy, and any infringements of the law cannot go unpunished.

We’re pleased to see that the latest developments in the online hotel booking investigation has seen undertakings agreed by numerous parties involved.

Update for the online hotel booking investigation

The update for the online hotel booking investigation from last month has seen formal undertakings agreed by a number of parties involved. These undertakings are designed to ensure that there’s a change in practises that the CMA has considered to be potentially misleading for the consumers.

Some of the issues raised by the CMA included:

• False representations of a room’s popularity and availability, leading to pressure sales;
• Failures to display the full costs of a room upfront;
• Concerns as to how hotels are ranked being unclear to the consumer (including when commission is being paid);
• Avoiding the use of strategically placed “sold out” hotels in search results to pressure sell;
• Clarity over alleged discounts and the avoidance of hidden charges.

All this can obscure the decision-making process for the consumer and can lead to people being misled into not getting the best deal. It’s understood that other travel agencies, hotel groups and comparison sites will also be warned to ensure there’s a standardised approach to compliance.

Who has agreed to the undertakings in the online hotel booking investigation?

The companies who have so far agreed to formal undertakings as part of the online hotel booking investigation are said to include:

• Agoda;
• Bookingcom;
• Ebookers;
• Expedia;
• Hotels.com;
• Trivago.

The CMA confirmed that not all of the firms who have agreed to the formal undertakings were engaged in the practices they were concerned about. It’s a positive step that all have agreed to the undertakings as the CMA looks to ensure there’s fair competition and no breaches of consumer law in this lucrative market.

Speaking about the latest developments in the online hotel booking investigation, CMA chairman Andrew Tyrie said:

“The CMA has taken enforcement action to bring to an end misleading sales tactics, hidden charges and other practices in the online hotel booking market. These have been wholly unacceptable.

6 websites have already given firm undertakings not to engage in these practices. They are some of the largest hotel booking sites. The CMA will now do whatever it can to ensure that the rest of the sector meets the same standards.”