German regulators order Booking.com to halt anti-competition clause

Booking.com is being ordered by a German antitrust regulator to allow hotels to offer lower prices than the online travel agency on their own websites. The regulation strikes at a parity clause in contracts between Booking.com and hotels that allow the OTA to claim it has the lowest rates available, but Germany's Federal Cartel Office said that this clause violates rules for fair competiton.

The OTA tried to appease regulators in December of last year by allowing hotels to offer lower rates on rival OTA sites, but still not their own. This was deemed to still be illegal.

"These so-called narrow best-price clauses still limit competition between existing portals as well as competition between the hotels," Andreas Mundt, the cartel office's president, said in a statement on Wednesday. "The incentive for a hotel to reduce its prices on a hotel portal is very low when it has to charge higher prices on its own website at the same time."

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Booking.com now has until Jan. 31 to do away with the clauses. Similar clauses are under investigation at Expedia, and Booking.com said in a statement that it plans to appeal the decision, but will comply with the new policy until a final ruling is made.

The company last made headlines when it challenged web developer Triptease with legal action over its installing a widget onto hotel websites to display rate comparisons across multiple sites. That case is still under investigation.

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