Following the €486 million fine imposed on Booking.com by Spain’s CNMC in July 2024, the European Court of Justice (ECJ) has now delivered a complementary blow to the online travel giant’s practices.
In September 2024, the ECJ issued a landmark ruling that could have profound implications for hotel distribution across the EU. The case, brought forward via a referral from the Dutch courts, scrutinised the legality of “wide parity clauses” — a central component of the CNMC’s earlier decision.The European Court of Justice (ECJ) issued a significant judgment in September 2024 that could have profound implications for the hotel distribution ecosystem across Europe. The judgment addresses the legality of so-called “wide parity clauses” imposed by Online Travel Agencies (OTAs), such as Booking.com, that prohibit hotels from offering lower prices or better availability on other platforms — including their own websites.
This ruling followed a request from the Dutch courts, which questioned whether such clauses breached Article 101 of the Treaty on the Functioning of the European Union. The ECJ concluded that wide parity clauses may indeed violate EU competition law by restricting price competition and reinforcing the dominance of major platforms.
In its judgment, the ECJ noted:
“Contractual clauses which restrict the ability of accommodation providers to offer better terms through alternative sales channels may have the object or effect of preventing, restricting or distorting competition within the internal market.”
The ECJ highlighted several harmful effects: the clauses reduce pricing freedom for hotels, deter direct bookings, stifle competition among OTAs, and ultimately lead to higher prices for consumers. These practices also make it more difficult for new
entrants to gain traction, entrenching the market power of already dominant platforms.
Craig Cooper, Managing Director of Barings Law, reflected on the decision:
“While the ECJ case differs legally from the CNMC’s findings in Spain, both outcomes point in the same direction: courts and regulators are increasingly critical of how dominant platforms manage their commercial relationships. The cumulative effect of these decisions suggests a much wider reassessment may now be underway — not only across the EU, but potentially here in the UK.”
The ruling has not only validated ongoing investigations by national competition authorities, but also given new momentum to legal teams representing affected hotels. Legal professionals across the EU are now reviewing historic contracts and commercial losses in light of the ECJ’s guidance.
In Spain, hoteliers are reportedly preparing claims in parallel with the Booking.com appeal process, positioning themselves to take action depending on how the case develops. Legal teams in the UK are following suit — exploring whether similar contracts could lead to financial redress under UK law, particularly for those subject to parity clauses between 2016 and 2024.
Additionally, lawyers are examining other restrictive platform practices identified in the ECJ case: algorithmic penalisation for offering better rates elsewhere, non-transparent ranking systems, and the imposition of high commissions that left little margin for hotels to remain competitive.
This ruling has reinforced the view that many practices once deemed standard in the industry may soon be considered unacceptable.
