Revolution in the Berlin hotel market: 100 hotels sue Booking.com!

Revolution in the Berlin hotel market: 100 hotels sue Booking.com!

Around 100 hotels from Berlin and just as many from Brandenburg have filed a lawsuit against the booking portal “Booking.com”. In recent weeks, these legal actions have developed into a comprehensive initiative supported by the European hotel alliance Hotrec and over 30 national hotel associations. Tobias Warnecke, Managing Director of the German Hotel Association (IHA), confirmed that many companies were taking part and explained that more than 4,000 hotels across Germany were affected, while the number rose to over 10,000 across Europe. The lawsuits are directed against the best price clauses, which for years have prohibited hotels from offering lower prices on their own websites.

A central point in this dispute is a ruling by the European Court of Justice (ECJ) from autumn 2024. The ECJ found that the best price clauses are contrary to antitrust law and thus prevent competition on the hotel market. The implications of this ruling are far-reaching, as it led to the abolition of these clauses by “Booking.com”, which was implemented in 2024 in accordance with the requirements of the EU digital markets law “Digital Markets Act”. Warnecke estimates that hotels could reclaim around 30% of the commission payments made to “Booking.com” over the years as a result of these unlawful practices.

Lawsuit and claims for damages

The hotels are seeking damages for the period from 2004 to 2024, during which they were forced to enter into price fixing, which violates antitrust law. These demands aim to compensate for the financial losses suffered as a result of the enforced fixed prices. It remains to be seen how successful the lawsuit will ultimately be, which will be heard in a Dutch court where Booking.com is headquartered. The class action filing deadline has been extended to August 29, and participation is free and risk-free for hotels.

The discussion about best price clauses is not new in Germany. The Federal Cartel Office banned HRS’s practices as early as 2013, followed by proceedings against “Booking.com” and Expedia. An important ruling by the Federal Court of Justice in 2021 declared that “Booking.com’s” best price clauses are not compatible with antitrust law. Currently, the debate about these topics is underpinned by the remarkable market share of “Booking.com”: According to Hotrec, the company had a market share of 72.3% for online hotel bookings in Germany in 2023.

Market development and reactions

Despite the legal challenges, Booking.com reported a second quarter revenue increase of 16% to $6.8 billion. Further sales growth of 7-9% and an increase in booked overnight stays of 3.5-5.5% are forecast for the third quarter. This positive development is supported, among other things, by robust demand from Asia, particularly from wealthy Chinese tourists, which partially offsets the weaker development in the USA. Around 25% of reservations now come from Asia.

The Brandenburg Hotel and Restaurant Association (Dehoga) is encouraging hotels in the region to join the lawsuit. This action could change the dynamics in the competition for direct bookings, especially given that the share of direct bookings in Germany fell by over 8% between 2013 and 2023. The lawsuit is therefore an important step on the part of the hotel industry to strengthen its market position and create fairer conditions in digital sales.

For more information on this topic, see reports from rbb24, daily news and Deutschlandfunk Nova.