The Commission of the European Union has prohibited the proposed acquisition of eTraveli by Booking under the EU Merger Regulation.
According to the Commission, the acquisition of eTraveli by Booking would strengthen the dominant position of the latter on the market for hotel online travel agencies (OTAs) and lead to higher costs for hotels and consumers.
For this reason, the Commission has prohibited the proposed acquisition while at the same time stressing that Booking did not offer sufficient remedies to address the concerns.
Booking’s acquisition of eTraveli would strengthen Booking’s dominant position in the online travel agencies market and likely lead to higher costs for hotels and, possibly, consumers.
Moreover, commenting on the matter, Commissioner Reynders said that Europe is a leading tourist destination, attracting millions of tourists each year, stressing that the decision of the Commission is the right one to prevent Europe’s global standing.
Commissioner Reynders further noted that there are significant negative effects of the merger, and there is also an absence of suitable remedies.
Our decision to block the merger means that European hotels and travellers will not be further limited in the options available to offer their services and book their trips.
As the Commission explains, the decision to block the acquisition of eTraveli by Booking follows an in-depth investigation, during which it was found that Booking is the dominant hotel OTA in the European Economic Area, reaching a market share of more than 60 per cent over the past ten years.
Moreover, it was found that the transaction would have allowed Booking to acquire a main customer acquisition channel as well as to expand its travel services ecosystem.
In addition to the above-mentioned, the Commission stressed that the transaction would make it harder for competing OTAs to develop a customer base that is capable of supporting a hotel OTA business.
As per Booking’s proposed remedies, the Commission said they were not adequate to the competition concerns.
In its merging proposal, Booking said that it would show flight customers a choice screen after purchasing a flight ticket. In this so-called choice screen, Booking said that it plans to display hotel offers, allowing customers to book accommodation immediately.
However, this was not seen as effective by the Commission, which said that this and other proposed remedies by Booking did not eliminate the identified competition concerns. As a result, it has been officially decided to prohibit the proposed transaction.
