OFT not happy with IHG's deals with online agents

Holiday Inns operator InterContinental Hotels Group (IHG) has disagreed with the findings of an Office of Fair Trading (OFT) investigation which criticised the hotel group's arrangements with two online booking agents.

In the OFT's view, the deals IHG struck with online travel agents Booking.com and Expedia in relation to "room only" accommodation broke competition rules. IHG begs to differ, saying its considers its arrangements with the online booking agents to be "compliant with competition laws and consistent with the long-standing approach of the global hotel industry."

The OFT's Statement of Objections says: "The OFT considers that the alleged infringements are, by their nature, anti-competitive in that they could limit price competition between online travel agents and increase barriers to entry and expansion for online travel agents that may seek to gain market share by offering discounts to consumers."

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IHG said it is cooperating fully with the OFT's investigation, which commenced in 2010 after the OFT received a complaint from a small online travel agent, which alleged it was being prevented by various hotel chains from offering discounted sale prices for room-only hotel accommodation.

The "Statement of Objections" covers the OFT's provisional findings only. All parties will now have the opportunity to respond to the statement before the OFT decides if competition law has in fact been infringed.

OFT chief executive Clive Maxwell said: "We want people to benefit fully from being able to shop around online and get a better deal from discounters that are prepared to share their commission with customers."

JH