Spain’s competition regulator has delivered a stinging rebuke to online travel giant Booking.com, handing down a record EUR413 million ($446.88 million) fine for abusing its dominant position in the market over the past five years.Â
Unfair business practices
The National Commission for Markets and Competition (CNMC) concluded that Booking.com’s business practices had created an unfair imbalance in its commercial relationships with Spanish hotels. By prioritizing Booking.com listings and bookings, the platform had effectively shut out competing online travel agencies from gaining a meaningful foothold.
Market dominance, consumer impact
“These practices have affected hotels located in Spain and other online travel agencies that compete with the platform. Its terms and conditions create an inequitable imbalance in the commercial relationship with hotels located in Spain,” the CNMC further stated.
Additionally, with a market share estimated between 70-90 percent in Spain – the world’s second most popular tourist destination – Booking.com’s outsized influence has come at a cost to consumers and businesses alike, the regulator argued. Travelers have been denied the full range of options, while hoteliers have had limited opportunities to promote their offerings beyond Booking.com.
Regulatory crackdown
Furthermore, the fine is a stark warning shot from Spanish authorities, who are determined to rein in anti-competitive behavior in the booming online travel sector. Booking.com, owned by U.S.-based Booking Holdings, has vowed to appeal the “unprecedented” decision, insisting it offers valuable programs to support its accommodation partners.
However, the regulatory crackdown extends beyond Spain’s borders. The European Union recently added Booking.com to its list of digital gatekeepers subject to tougher competition rules under the landmark Digital Markets Act. The goal is to foster greater choice and fairer conditions for both consumers and businesses in the online marketplace.
Read more: Global travel and tourism sector to grow by about $15 trillion over next decade: WTTC
Reshaping competitive dynamics in vacation booking
As the travel industry navigates the post-pandemic landscape, this clash between a dominant online platform and national competition authorities signals a wider reckoning for the digital economy. Moreover, the outcome could reshape the competitive dynamics – and the consumer experience – in the lucrative vacation booking business for years to come.
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