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AAoA closely watching UK competition action against OTAs

UK competition regulators are looking at sales tactics of online hotel retailers

Accommodation Association of Australia CEO Richard Munro has urged the ACCC to keep a close eye on enforcement action being taken by its UK counterpart against online travel agents (OTAs).

The UK’s Competition & Markets Authority (CMA) has sought legal avenues to force online travel retailers to address a number of concerns which it believes may be misleading consumers.

Four main areas of concern make up the action, including how hotels are ranked in search results and whether that rank is influenced by commission payments and therefore puts the hotels front and centre in search results even if they’re irrelevant to a customer’s enquiry. It also felt advertised discounts were duping customers by promoting a discount based on heavily inflated “peak season” rates such as on New Year’s Eve and not its normal rack rate.

Hidden charges were also on the agenda, as were tactics of pressure selling by clouding a consumer’s judgement by claiming only one room was left available at that rate, how many people were looking at the same deal at that time or trying to rush customers into a sale by saying a sale price was about to expire.

CMV is aiming to secure binding agreements from online retailers to change their business practices or if necessary, launch legal action. In addition to those specifically being targeted, warning letters have also been sent to a variety of others who may be considering adopting similar tactics.

Munro said the AAoA was leading this “very important issue” for the betterment of its members here in Australia.

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