France bans OTA parity clauses

The French National Assembly has become the first government to ban any rate parity clauses from contracts between accommodation providers and online travel agents.

French decision allows accommodation providers in France to set lower prices both on their online and offline direct distribution channels – including their own website – than the rates available via intermediaries, thus putting an end to mandatory rate parity clauses.

With this decision accommodation providers in France regain their entrepreneurial freedom and will be able to offer their customers any trade or tariff advantage they consider appropriate. France is thus the second country after Germany, where public authorities decide to ban rate parity clauses from OTA contracts.

“It is a real revolution that is underway for the French hotel industry and for our customers. After the decision of the Competition Authority, this vote will contribute to the establishment of a renovated contractual framework to restore conditions of a commercial relationship based on trust between hotels and booking sites in the interest of consumer,” says Roland Heguy, president of HOTREC’s French member association UMIH.

This decision together with the decisions taken by the German competition authority and court earlier, seriously question the relevance of the recent announcement of and Expedia for the alignment of their terms and conditions similar to the formal commitments of 21 April.

“The European hotel industry very much hopes that this roll-out of the restoration of the entrepreneurial freedom will not stop at the French and German borders,” concluded Susanne Kraus-Winkler, president of HOTREC.

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