Expedia, Booking.com Defend Sales Tactics After UK Clampdown -- Update
(Adds company comment, detail throughout.)
--Hotel-booking sites have defended their sales tactics after a U.K. regulatory investigation led to an agreement to clamp down on pressure-selling and potentially misleading offers.
--Expedia, Trivago and Booking.com were among the six sites investigated. Despite the agreement to limit sales practices, there was no finding that any site had breached consumer law.
--The reforms may extend further in the travel industry, as U.K. regulators write to online travel agents, metasearch engines and hotel chains over their legal compliance.
By Adam Clark
Hotel-booking site owners Expedia Group Inc. (EXPE) and Booking Holdings Inc. (BKNG) have defended their sales practices, after signing up to an agreement with U.K. regulators to curb pressure-selling tactics and improve transparency.
The U.K.'s Competition and Markets Authority announced the deal on Wednesday following a 15-month investigation into sites including Expedia, Trivago, and Booking.com.
The CMA said all the sites under investigation had agreed not to use tactics to pressure customers to book quickly, such as including sold-out hotels within search results or inflating the number of people searching for the same location. They also agreed to improve transparency over search results and discount claims.
"The CMA has taken enforcement action to bring to an end misleading sales tactics, hidden charges and other practices in the online hotel-booking market. These have been wholly unacceptable," CMA Chairman Andrew Tyrie said.
"Six websites have already given firm undertakings not to engage in these practices. They are some of the largest hotel booking sites. The CMA will now do whatever it can to ensure that the rest of the sector meets the same standards," Mr. Tyrie said.
The regulator didn't make a finding on whether any site had breached consumer law, and said not all of the companies who signed up to the agreement had engaged in all of the practices under investigation. The agreement only applies to U.K.-based websites and all changes must be made by Sept. 1.
Expedia said it was "surprised and disappointed" in the CMA's description of the pact, saying it was a collaborative effort to establish industry standards. The company, which owns brands including Hotels.com, Trivago, Orbitz and Travelocity, said it continues to believe its practices didn't breach any consumer laws.
Booking.com said it was pleased the investigation had closed without any admission of infringement on its behalf. The site said it has agreed to implement new commitments such as showing prices inclusive of all fees.
The U.K. investigation was launched in October 2017, and the CMA said at the time that 70% of consumers who shopped around for hotels were using the sites under investigation. Previously consumer body Which had questioned the way discounts offered by Expedia and Booking.com were calculated, arguing the sites used selective comparisons.
"We have repeatedly exposed sites such as these for using dodgy tactics like pressure selling, sneaky charges, dodgy deals and discount claims, so it's absolutely right that the CMA is taking strong action," Rory Boland, travel editor at Which, said.
The regulator will also write to other hotel-booking sites, including online travel agents, metasearch engines and hotel chains, setting out expectations for how they should comply with consumer-protection law.
Write to Adam Clark at email@example.com; @AdamDowJones
(END) Dow Jones Newswires
February 06, 2019 08:38 ET (13:38 GMT)Copyright (c) 2019 Dow Jones & Company, Inc.