The online booking portal Booking.com has removed the controversial discount clauses throughout the European Economic Area (EEA) ahead of a final EU ruling. These clauses, which Booking itself describes as price parity, have previously required hotels to offer prices on the platform that are at least as low as those on their own website. This step had already been taken in Germany.
Booking justified this step by saying that it wanted to fulfil its obligations under the Digital Markets Act (DMA), which aims to promote competition in the digital market. Despite the argument that the clauses would create a more competitive environment and offer consumers uniform price advantages, Booking said in response to a request that it had decided to remove them.
The elimination of the discount clauses follows a long dispute between Booking and the hotel industry, which culminated in Germany in May 2021 with a ruling by the Federal Court of Justice. The court declared the clauses illegal after the dispute had been going through the courts since 2015 and the Federal Cartel Office was involved.
Booking’s decision came ahead of an expected EU ruling which, according to the ECJ Advocate General, will classify the best price clauses as a violation of EU competition law. A final decision by the ECJ on a claim for damages brought by more than 300 German hotels against Booking is expected in the next few months.
Booking has always defended the clauses to prevent free-riding, where customers could use the platform for information but then book directly with the hotel. However, this argument was rejected by the Federal Court of Justice, particularly in light of Booking’s dominant position with a market share of over 60 percent in the area of hotel booking portals.
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