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BHA calls for OTA rate parity ban after French vote against

26 June 2015 by

The British Hospitality Association (BHA) has renewed its call for the EU and UK to outlaw rate parity clauses, and has supported the French government's recent vote to ban rate parity.

The statement comes after this week's news that online travel agent (OTA) Booking.com is to roll out a narrow price parity policy, and the vote this week by the French National Assembly to cancel rate parity clauses altogether, with a fine for infractions of up to €150,000 (£106,500).

Narrow rate parity prevents hotels from offering a lower public room rate on their own website, compared with the rate given to the online travel agent to sell the room.

Earlier this week, Booking.com announced it would change its rate parity clauses in Europe from 1 July this year, due to commitments to competition authorities in Sweden, Italy, and France. This means that it has, it said, "abandoned its price, availability and booking conditions" that would allow it to demand lower prices on its own site than those found on establishments' own websites.

This would increase competition between OTAs, it claimed, but critics argued that the website's "narrow" clause meant it could still charge the same or less than the price shown on clients' own sites.

The BHA said it would continue to lobby the UK and EU to support fair commercial practices, as it had when it called on the French Competition Commission in January to ban rate parity clauses.

The proposed law still has to go through the French Senate in the coming weeks.

In a statement, the BHA said: "Removing rate parity clauses will give hoteliers the freedom to promote their own deals for customers on their own websites."

Jackie Grech, legal and policy director at the British Hospitality Association, added: "Hotels are handcuffed by rate parity clauses and restricted from offering the best deals to customers on their own hotel websites. As an industry, we work with OTAs as they provide an important service to enable hotels to attract bookings that they potentially wouldn't bring in on their own…but the fees for using OTAs are significant. That's why we believe that where hotels can attract direct bookings to their own websites, they shouldn't be restricted from doing so."

On the French government's vote, Grech said: "The French legislative decision will free up the market by restoring competitive pricing to customers. The BHA commends the French Assembly for taking this move and encourages the French Senate to follow suit when they vote on this matter in two weeks' time.

"With Germany and France taking a clear stance on rate parity, we look to the EU and Competition and Markets Authority in the UK to harmonise the cross-border position."

BHA slams OTAs for ‘stifling competition' when booking hotels >>

Independent hoteliers want stricter OTA rules, says survey >>

OFT accepts price parity commitments from IHG and OTAs >>


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