Hotels permitted to undercut Booking.com

The online booking company Booking.com has been required to remove parity clauses that forbid hotels that advertise on the platform from offering lower prices on their own websites.

In the past, it was common for those making hotel reservations to check the hotel’s website to compare prices quoted on other platforms. However, the introduction of parity clauses by many of the main booking sites reduced this tactic to a minimum. 

Now, a new EU directive on Digital Markets now classes Booking.com as a “guardian” company, along with other names such as Apple, Microsoft, Meta and Amazon.  Under the directive, guardian companies are not permitted to apply parity clauses.

The parity clauses were initially introduced to guarantee Booking.com a profit margin. However, a combination of price cuts following the recession, and the guardian companies’ dominance of the market, has disadvantaged hotels.