The UK’s Competition and Markets Authority (“CMA”) announced on 28th June 2018 that it is taking enforcement action against several hotel booking sites over potential breaches of consumer protection law. The CMA has not named the companies involved in its investigation
The CMA states in its press release ( https://www.gov.uk/government/news/cma-launches-enforcement-action-against-hotel-booking-sites) that its investigation, which began in October 2017, has identified widespread concerns, including:
- Search results: how hotels are ranked, e.g. the extent to which search results are influenced by factors that may not be relevant to the customer’s requirements, such as the amount of commission a hotel pays the site.
- Pressure selling: whether claims about how many people are looking at the same room, how many rooms may be left, or how long a price is available, create a false impression of room availability or rush customers into making a booking decision.
- Discount claims: whether the discount claims made on sites offer a fair comparison for customers. For example, the claim could be based on a higher price that was only available for a brief period or not relevant to the customer’s search criteria, such as comparing a higher weekend room rate with the weekday rate for which the customer has searched.
- Hidden charges: the extent to which sites include all costs in the price they first show customers or whether people are later faced with unexpected fees, such as taxes or booking fees.
If the CMA believes consumer laws have been breached, it can either secure legally binding commitments from those involved to change their business practices or, if necessary, take them to court to obtain an injunction to restrain them from engaging in these practices .
In addition to its enforcement activity, the CMA states it has sent warning letters to a range of sites, demanding they review their terms and practices to make sure they are fair and comply with consumer protection law. It is also referring a number of concerns around online hotel booking sites’ price guarantees and other price promises to the Advertising Standards Authority (ASA).