The Spanish National Markets and Competition Commission (CNMC) has fined online travel agent Booking.com US$530 million (R10 billion) for anti-competitive practices such as preventing local hotels from offering deals and discounts on their sites, reported surinenglish.com.
“We could not disagree more with this draft decision and the arbitrarily large fines that they have proposed, which is completely disproportionate to the alleged conduct,” Booking Holdings CEO Glenn Fogel said during the company’s Q4-2023 earnings call on February 22.
Booking Holdings CFO David Goulden called the preliminary decision in Spain “unprecedented”, reported skift.com.
According to Fogel, if the fine was sustained, the company would appeal. Furthermore, the appeal could take several years to process, added Goulden, saying that Booking.com would have to alter some business practices in Spain.
Booking.com is currently the largest online travel agency and accommodations provider in Spain and Europe.
The fine follows an investigation by the CNMC conducted in 2022 after two complaints were filed by the Spanish Association of Hotel Managers and the Madrid Hotel Business Association when they accused Booking.com of un-competitive practices.
Furthermore, it follows the EU’s looming regulatory action against Booking.com based on the Digital Markets Act (DMA), which came into effect in May 2023.
The DMA designates large digital platforms as 'gatekeepers' to ensure a fairer and more contestable digital sector and to prevent the monopolisation of online travel agencies, hotel and accommodation bookings, and metasearch engines. The European Commission considered naming Booking.com a gatekeeper. However, the decision is still contested.
“As we have previously disclosed, we plan to file our notification for designation under the DMA soon,” said Fogel. “And we believe the main concerns raised by the Spanish authority overlap with the DMA. We will continue to work closely with these regulatory bodies to maintain consistent rules.”
According to the European Commission, the DMA established obligations and prohibitions for what it deems ‘gatekeeper’ platforms, including:
- Allowing business users promoted on gatekeepers’ platforms to conclude contracts with their customers outside the gatekeeper’s platform.
- Allowing business users to access the data that they generate in their use of the gatekeeper’s platform;
- Providing companies advertising on their platform with the tools and information necessary for the advertisers and publishers to carry out independent verification of their advertisements hosted by the gatekeeper.
