How Europe is fighting back against Booking.com
Shocking issues you need to know before booking your stay.
More than 10,000 hotels across Europe have united to file a massive lawsuit against Booking.com, one of the leading global online travel agencies.
The lawsuit, which spans across 30 countries, claims that the platform’s business practices, particularly its high commission rates and restrictive clauses, are harming the competitiveness of the hotel industry.
Long-standing gripes over unfair terms imposed by the platform, especially for smaller and independent establishments, sparked the action, with the hotels now seeking “legal redress to recover millions of euros in damages from unfair commissions and other anti-competitive practices”.
Booking.com continues to dominate the online travel agency market in Europe, commanding an impressive 71% market share in Europe. The platform’s dominance has grown steadily, with the company’s share increasing by 10% over the last decade, despite facing competition from other platforms like Expedia, which holds only 15% of the market.
Booking.com seems to remain the preferred choice for millions of travellers seeking accommodations; however, this “widespread influence” has led to growing concerns among hoteliers about the platform’s business practices.
While the booking site has become crucial to the survival of small independent hotels, they claim the high commission rates and restrictive clauses prevent them from offering lower prices to travellers on other platforms, or even their own websites.
Hotels are required to pay a commission of approximately 15% for each reservation made through the platform, although the rates can exceed 20% in certain cases. This commission is seen by hoteliers as excessive, especially when compared to the services provided by the platform. Hotels argue that the fees leave them with little profit margin, particularly for smaller establishments that operate on tight budgets.
The so-called parity clauses, which prevent hotels from offering lower prices on other booking platforms or their own websites, are viewed as anti-competitive, as they restrict hotel owners’ ability to set their own pricing and market their rooms more competitively. The hotels involved in the lawsuit argue that these restrictive clauses have resulted in a lack of pricing flexibility, which harms both their business operations and consumer choice.
The lawsuit is being led by the European association Hotrec and is said to be one of the largest class-action lawsuits ever in the hospitality sector.
Some of the strongest objections have come from Spain, where Booking.com holds 90% market share, with 200,000 establishments relying on it for bookings.
The lawsuit seeks compensation for the unfair commissions paid by hotels, as well as the damages caused by the restrictive terms. The plan is to file the class-action lawsuit in Amsterdam, the headquarters of Booking.com, in the coming months. If successful, experts estimate that the total damages could amount to hundreds of millions of euros.
The suit comes after the European Court of Justice (CJEU) already ruled that Booking.com’s parity clauses restrict competition after a complaint by 2,000 German hoteliers confirmed that the clauses are anti-competitive and limit market competition.
In 2024, Booking.com was fined €413 million (R8.4 billion) for using parity clauses and other unfair commercial practices, but the platform has appealed the decision, and a provisional suspension of the fine has been granted while the case is being reviewed.
The outcome of this case could have wide-reaching implications for the future of online travel agencies and their relationships with the hospitality industry.
Source: Travel and Our World
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