France to sue hotel sites

THE government is starting legal proceedings against potentially illegal commercial practices by online hotel booking agencies booking.com and the Expedia group.

Previously, in August, it promised to amend the law to give hotels better rights, but has now put the groups under investigation for possibly breaking French commercial law.

According to Libération, the state’s action comes after an investigation by the DGCCRF – France’s trading standards body.

It found that two clauses included in contracts may violate the hotels’ trading rights: not allowing them to sell rooms for a price lower than that stipulated on the website and forcing them to reserve the last room of otherwise fully-booked hotels for the website.

The action could force the bookings agencies to review their contracts.

France’s Commission d’examen des pratiques commerciales, which has also examined in detail the clauses in the contracts, found that without government action the country’s hotels found themselves in a legal black hole, unable to act against the firms which are based in the Netherlands and United States.

The hoteliers’ union Umih yesterday published a list of grievances against the booking sites.

Alongside the clauses already mentioned, the union said that calculating commission rates based on prices that included tax meant that rises in VAT drew extra money towards the websites.

They said that commission rates could be from 15%-17%, but for some, up to 25% of the sale.

When contacted by Libération the director of finance for Booking.com, Olivier Bisserier, said their commission was 16.1%, far from the 25% quoted by hoteliers.

He said that clauses and commission rates had remained the same since 2008 and that the group had already organised a meeting with Umih.

“We have taken this initiative. The hoteliers never asked to see us until now. They prefer to speak to us via tough letters,” he added.