Case Booking - Tourism & Law advises: it is not yet the time to request compensation.

The CNMC's historic sanction against Booking, which has been achieved with the legal advice of Tourism & Law, marks a milestone in the defense of competition in Spain.

After the historic penalty of 413.2 million euros that the National Commission for Markets and Competition (CNMC) has imposed on Booking for abuse of dominance, a new legal framework is opening up in the market for large online intermediation of hotel distribution, according to Tourism & Law, a law firm that provided legal advice in the process to the Madrid Hotel Business Association (AEHM).

The resolution of the CNMC is based on two continuous infringements: exploitative and exclusionary abuse of dominance. It concludes that Booking, taking advantage of its leading position in the online tourist accommodation intermediation sector, imposed restrictive competition clauses on hotels, such as narrow rate parity, the obligation to accept conditions in English and the submission of disputes to the Amsterdam courts. In addition, it also sanctioned the lack of transparency in the preferential, preferential plus and genius programs, which exclusively benefited Booking.

Consequences for the hotel sector

The ruling has already brought significant changes for hotels in their dealings with Booking. As of July 1, 2024 Booking eliminated the narrow parity clause in Europe, has recognized the enforceability of clauses in Spanish and has allowed for the resolution of disputes in Spanish courts. These modifications, although justified by the need to comply with the Digital Markets Law, can only be seen as an obvious attempt to mitigate the impact of the sanction.

"According to the Antitrust Law, hotels that have suffered Booking's abusive practices would have the possibility of requesting compensation for damages, provided that these are real, demonstrable and quantifiable, and are duly individualized. This is an opportunity for the hotel establishments to compensate themselves for the damage suffered. However, if Booking finally appeals to the Audiencia Nacional to review the resolution, such a claim would have to wait until there is a definitive judicial pronouncement", points out Hortensio Santos, lawyer at Tourism & Law who has led this case.

Outreach to other associations and platforms

Although the administrative procedure as such is closed, other associations could appear as an interested party at a later date in the event that Booking appeals, as it has announced, before the Audiencia Nacional. Tourism & Law warns that "it is not yet the time to start filing claims", since it should not be forgotten that this resolution may be reviewed by the National Court, although at the same time they recognize that they are already working with many of their clients offering their advice for future claims.

And, as responsible for the legal advice of the AEHM throughout this process, Tourism & Law has the necessary expertise to support the rest of the actors in the sector once the time comes to take action. "Be that as it may, the CNMC resolution sends a clear message to other accommodation management platforms (such as Airbnb): that they must adjust their behaviors to Spanish and European competition regulations, avoiding any practice that could be considered abusive or unfair. However, our objective has already been achieved, which is the modification of the conditions that Booking applies to hotel establishments in Spain", adds Mª Paz Abad, director of Tourism & Law.

A milestone in the defense of competition

Tourism & Law has played a key role in this legal process by diagnosing the situation of the affected hotels and providing the necessary legal advice. Its work included the collection of testimonies and documentary evidence, as well as the continuous assistance to the Madrid Hotel Business Association (AEHM) throughout the procedure.

"We are really satisfied with the work carried out because the interests of the hotels have been adequately defended and included in an exemplary sanctioning resolution that, without a doubt, marks a milestone in the defense of competition in our country", adds Mª Paz Abad.

Thus, the sanction against Booking not only represents a victory for the affected hotels, but also sets an important precedent for the regulation of digital platforms in the hotel intermediation market. The most obvious proof of this is the joy with which it has been received by the hotel sector as a whole.

About Tourism & Law

It is the law firm that advises companies in the tourism sector from a deep knowledge of the current legislation. With a preventive approach, its team of legal experts offers a comprehensive service of legal advice and assistance that guarantees the peace of mind of the companies and accompanies them in their day to day. Likewise, Tourism & Law is proud to assume the task of informing about the regulations in order to contribute to build together a quality tourism sector.

Tourism & Law is a company of Grupo Atlantigo.

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