Leading OTAs Booking.com, Expedia.com and Trip.com have offered to remove clauses in existing and future agreements with accommodation providers in Hong Kong that may harm competition, according to the Competition Commission.
Currently, clauses stipulate properties must always give the three OTAs the same or better terms as offered in any other sales channels when it comes to wide price parity, wide conditions parity and room availability parity.
Wide price parity has the effect that the accommodation provider always has to give the OTA the same or better price as the prices it offers or applies across all other sales channels (including the accommodation provider’s own offline sales channels and other OTA platforms)
The Competition Commission was concerned over whether this practice prevented smaller OTA businesses from entering into or expanding within the industry, while also leaving consumers missing out on the benefits of lower and more varied room rates. Further, this practice may have been contravening ordinance rules.
Benefits will likely result in new OTA businesses able to accept lower commissions offer better rates, conditions or availability. More competition between OTAs on hotel prices will additionally benefit both the consumer and hotels.
The Competition commission will consider representations until 14 April before making a final decision on whether to accept the proposed commitments by the OTAs.