Booking.com Fined €413 Million by Spanish Regulators for Anti-Competitive Practices

Regulators in Spain have fined Booking.com €413.24 million for abusing its market dominance over the past five years. The Comisión Nacional de los Mercados y la Competencia (CNMC) found that the online travel agency imposed unfair conditions on Spanish hotels and restricted competition from other OTAs.

Key Allegations and Penalties

Booking.com was accused of two main abuses:
1. Imposing unfair commercial conditions on hotels using its booking services.
2. Restricting competition from other online travel agencies.

The CNMC highlighted practices such as:
– A price clause preventing hotels from offering lower rates on their own websites compared to Booking.com.
– Lack of transparency in subscription information for Booking’s Preferred, Preferred Plus, and Genius programs.
– Using the total number of reservations as a ranking criterion, encouraging hotels to rely solely on Booking.com for online bookings.

These practices, according to the CNMC, have allowed Booking.com to control between 70-90% of the Spanish hotel market since 2019.

Booking.com’s Response

Booking Holdings CEO Glenn Fogel announced the company’s intention to appeal the decision, arguing that the Digital Market Act (DMA) is a more appropriate forum for addressing these issues. Booking.com emphasized the competitive nature of the sector and the support programs offered to accommodation partners, criticizing the CNMC’s decision for its lack of consistency for consumers and hotels in Spain.

Industry Impact and Future Implications

This ruling represents a significant moment in hotel distribution, marking one of the largest fines for anti-competitive practices in the industry. Javier Delgado, managing partner and EMEA CEO for Mirai, noted that competition authorities are aiming to level the playing field between hotels and distribution platforms. The outcome of similar investigations, such as the one opened by the Italian Competition Authority, will be closely watched as the industry navigates the implications of these regulatory actions.

Behavioral Obligations and Next Steps

The CNMC has imposed several behavioral obligations on Booking.com to ensure compliance and prevent further anti-competitive practices. Booking.com has two months to file an administrative appeal against the order.

As the industry awaits how Booking.com will interpret the DMA by mid-November, the landscape of hotel distribution and competition may see significant changes, potentially reshaping the balance of power between hotels and online travel agencies.