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Publication

Uncommitted

John Cassels
31/10/2014

Locations

United Kingdom

In the UK, the investigation into unlawful restrictive agreements in the hotel online booking sector was closed by way of commitments offered by the parties.

In the UK, the investigation into unlawful restrictive agreements in the hotel online booking sector was closed by way of commitments offered by the parties.

The investigation looked into agreements between Expedia, Booking.com and the hotel group IHG which restricted the online agents from offering discounted rates in IHG hotels and included 'most favoured customer' clauses designed to ensure that Expedia and Booking.com would not be undercut by other online agents.   The parties' commitments addressed only the restriction on offering discounted rates in IHG hotels.   They provided that Expedia and Booking.com would be allowed to offer discounted rates to members of closed groups or 'clubs'. 

Skyscanner, a price comparison site, objected to the commitments during the period of consultation and then challenged the decision of the UK's Competition and Markets Authority to accept the commitments: any discounted prices would not be available for its price comparison site, since discounted rates would only be visible to consumers once they had joined the relevant online agent's club.

This was the first appeal against a decision by the CMA to accept commitments to close an investigation and the decision was quashed, largely on procedural grounds.   In particular, the Competition Appeal Tribunal found that the CMA had failed properly to consider Skyscanner's submissions on the commitments during the consultation period. 

Companies that might be affected by cases closed via commitments are entitled to have any submissions they make during the consultation period properly considered by the CMA, regardless of whether full supporting evidence is furnished.

If you are interested in these issues, please do not hesitate to contact John Cassels at john.cassels@fieldfisher.com

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