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OTAs sign up to CMA principles, but hotel chains ‘need more time’

13 September 2019 by
OTAs sign up to CMA principles, but hotel chains ‘need more time’

The Competition and Markets Authority (CMA) has secured changes from the majority of hotel booking sites operating in the UK to prevent customers from being misled.

However, six of the largest hotel groups including Accor, InterContinental Hotels Group (IHG), Hilton, Marriott International, Radisson Hotel Group and Wyndham Hotels and Resorts have requested more time for ‘technical reasons’.

A total of 25 sites, including TripAdvisor, Airbnb and Google, have agreed to change how they display information where needed and have signed up to the CMA’s sector-wide principles. This includes not giving a false impression of a room’s popularity and displaying the full cost of a room upfront. Most have already made the necessary changes.

But the CMA said the hotel firms, although signed up to make the changes, have requested more time “to introduce specific technical updates so that UK customers are always shown the full cost of a room upfront when searching for hotels abroad”. It said it will be “closely monitoring to ensure that these firms make the required changes in a timely manner”.

A deadline of 1 September was set more than six months ago for sites to comply with guidelines including disclosing the effect of payments on search results as well as misleading presentation of prices and popularity and availability statements. Companies that don't meet these risk enforcement action by the CMA through the courts.

The new rules apply to any business offering online accommodation booking services, including online travel agents (OTAs), metasearch engines, big hotel chains and individual hotels offering online booking.

The CMA took enforcement action against six companies last year – Expedia, Booking.com, Agoda, Hotels.com, Ebookers and Trivago – over serious concerns it had around such issues as pressure selling, misleading discount claims and the effect that commission has on how hotels are ordered on sites. All six have now made the agreed changes.

However, a spokesperson for Radisson Hotel Group said: "Although this information has not been shared with us by the CMA, we believe the difference in the time needed to implement the CMA’s principles between OTAs and hotel chains to be due to the fact the OTAs and the CMA agreed in 2018 the substance of the CMA’s principles, whereas all the hotel chains were only informed of the issue of the CMA’s principles earlier this year in 2019. So, the hotel chains had in fact significantly less time to implement the CMA’s principles.

"In the case of Radisson Hotel Group, we had to launch our new online booking platform radissonhotels.com during the same period which took place in June this year. All this ended up in us requesting an extension of time until the end of this year to be able to fully implement the CMA’s principles."

The CMA said it gave the whole industry the same timeframe in which to make any necessary changes.

CMA chief executive Andrea Coscelli said: “People booking hotels online can now do so with more confidence thanks to the CMA’s action. Major websites and big hotel chains have agreed to clean up their act if they’ve been using misleading sales tactics and have signed up to sector-wide consumer law principles on how to display important information to customers.

“The CMA will now be watching to make sure that these major brands, used by millions of people in the UK every year, stay true to their word. We will take action if we find evidence that firms are breaking consumer law.”

A spokesperson for Accor said: “We welcome this action as it will ensure all hotel booking sites now operate to the same standards. With almost 4,900 hotels in 110 countries our global booking system is complex, but we are committed to implementing the technical updates to meet the CMAs new requirements as soon as possible.”

A spokesperson for Hilton said: "We focus on giving our guests the best possible experience, and that starts when they visit hilton.com to make a reservation at one of our 5,900 hotels.

"During the last six months, we have worked closely with the CMA to ensure that our booking process aligns with their principles and is transparent. We remain committed to our planned technology upgrades that will further improve the booking experience for our customers."

A statement from Marriott International said: "Marriott International appreciates the work of the Competition and Markets Authority (CMA) in addressing the wide range of experiences consumers have when booking hotel rooms online.

"Working with the CMA, Marriott has committed to update both our website and mobile app in order to provide consumers with even greater transparency into room rates and any applicable fees and/or taxes. To make these changes, we are shifting some of our digital priorities and expect to complete the work in the first half of 2020."

An IHG spokesperson said: “IHG is a global organisation and we comply with consumer protection and pricing laws in all of the countries in which we operate. We are compliant with the CMA’s 2019 principles for bookings made by UK guests for UK hotels and we continue to work with the CMA for locations outside of the UK.”

A spokesperson for Wyndham added: “We understand the CMA reached consensus with the OTAs on the principles established before approaching hotel companies such as Wyndham earlier this year. Like it has done with several other hotel companies, the CMA has agreed with Wyndham to a reasonable timeline for implementation of technology enhancements to comply with these new principles.”

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