JOHANNESBURG, 14 August 2024 – FEDHASA warmly welcomes the agreement between the Competition Commission and Booking.com to address price parity clauses in their contracts with accommodation providers. This is a significant win for fair competition within the tourism industry and a major relief for hotels and guesthouses across South Africa.
For too long, there were rules in place which were non-competitive, exclusionary to SME’s and detrimental to accommodation providers. Especially the price parity clauses placed undue pressure on accommodation providers, forcing them to maintain consistent pricing across all platforms, regardless of the significantly higher commissions charged by some online platforms.
The platform’s terms have, until now, disadvantaged accommodation providers by obligating them to advertise prices on their own platforms no higher than on Booking.com‘s platform, all while servicing Booking.com fees ranging from 10-25%, averaging at 15%. The commission rate varies according to one’s properties type, location and cancellation policy.
The commitment to remove both wide and narrow price parity clauses is incredibly encouraging. This levels the playing field and empowers accommodation providers to offer more competitive rates through their direct booking channels, ultimately benefitting South African consumers. Accommodation providers will now be able to offer fairer prices on their own advertising platforms, which will improve profit margins and benefit tourists.
Furthermore, FEDHASA applauds Booking.com‘s agreement to support historically disadvantaged SMEs in the tourism sector with initiatives to assist in growing their hospitality and tourism businesses. This commitment aligns with the industry’s goals of fostering inclusivity and sustainability in the hospitality market.
These changes are long overdue, and FEDHASA is confident that they will lead to greater transparency, fairer pricing, and increased opportunities for all stakeholders in the South African tourism sector. We extend our sincere thanks to the Competition Commission for facilitating these necessary changes, which will benefit the hospitality and tourism industry, SMEs of previously disadvantaged persons, and tourists alike.
***ENDS***
About FEDHASA
Founded in 1949, a restructured and transformed FEDHASA (Federated Hospitality Association of South Africa) is recognised by Government as the official representative of the hospitality industry of South Africa. With industry support, FEDHASA remains the umbrella association for hotels, restaurants, conference centres, caterers, self-catering accommodation, home hosting establishments (B&Bs and guest houses), clubs, taverns, shebeens, suppliers and trainers, consultants and service providers to the hospitality industry. For more information, visit https://fedhasa.co.za/
Issued by Big Ambitions Marketing
Kim Taylor
Email: kim@bigambitions.co.za
Tel: +27 (0)76 825 55508