Booking.com face €500 million fine in Spain for “fair practice” violations

Online accommodation booking platform, Booking.com, is preparing to contest a historic fine imposed by the Spanish regulators for violations of fair practice. Booking Holdings announced on Thursday, that the company intends to challenge the sanction from the CNMC (National Markets and Competition Commission) that carries a fine of $530 million.

Having completed its investigation in 2022, the CNMC found Booking Holdings guilty of engaging in anti-competitive practices, paving the way for a substantial fine.

Booking Holdings expressed disappointment with the CNMC’s draft decision, strongly disagreeing with its findings, saying the intend to lodge an appeal if it becomes final. The Netherlands-based company, which dominates the global online hotel accommodation sector, operates as a subsidiary of the US Booking Holdings group.

Their Chief Financial Officer, David Goulden, characterised the preliminary decision in Spain as “unprecedented”, and the CEO of Booking Holdings, Glenn Foge, reiterated the company’s stance on appealing the fine if the draft decision becomes permanent.

Meanwhile, Goulden added that the appeals process could take several years, necessitating changes to some of Booking.com’s business practices in Spain during this time.

The fine imposed in Spain adds to the regulatory challenges facing Booking.com, including imminent action by the European Union under the Digital Markets Act (DMA). As the largest online accommodation provider in Spain and Europe, Booking.com’s importance in the travel industry remains paramount.

Booking Holdings also suffered a $276 million loss related to what the company described as the “Dutch pension fund issue.” In this case, an appeals court in The Hague confirmed Booking.com’s status as a travel agency, forcing the registration of employees in a pension fund across the Amsterdam-based travel industry.

According to a report by Booking Holdings, Booking’s fourth-quarter net profit fell 82% to $222 million, while revenue rose 18% to $4.8 billion.

Despite the setbacks encountered in the latter part of the year, Booking ended 2023 on a relatively positive note, with a 40% year-over-year increase in net profit to $4.3 billion on revenue of $21.4 billion, reflecting an increase of 25%.