Blog

The Office for Protection of Competition confirms CZK 8.3mn fine on Booking.com

14/11/2019

The Office for Protection of Competition has imposed a fine of CZK 8,336,000 on the company Booking.com for indulging in prohibited anti-competition practices in the field of online short-term accommodation bookings.


The Office has found that between 2009 and 2015, Booking.com entered into several prohibited vertical agreements with providers of short-term accommodation services in the Czech Republic. The Office determined that these agreements distorted competition in the online booking platform market for hotels in the Czech Republic, and potentially other EU countries. In its first-instance decision, the Office concluded that Booking.com had acted in breach of competition law by engaging in anti-competitive practices.


Booking.com, inter alia, included so-called parity clauses in its agreements with its business partners. According to these clauses, Booking.com was to receive the same or better booking conditions in terms of price, availability of rooms, and other booking conditions, than those available on the website of these accommodations, or on any other online or offline distribution channel. As a result of these restrictive clauses, none of Booking.com's competitors were able to obtain better booking conditions from the accommodation. According to the Office, by entering into such preferential agreements, Booking.com had prevented the development of competition within the market sector. The decision of the Office was based on an in-depth investigation during which hundreds of hotels were approached and interviewed.

Further, the Office rejected Booking.com's objections in appeal relating to the demarcation of the relevant market, or the proof of anti-competitive consequences. The Office described the offence as serious.


In view of other EU member states, this administrative decision is important. The Office concluded that Booking.com's conduct may potentially influence the trade among EU member states in terms of providing online booking services for short-term accommodation.