Removal of price parity clauses between online travel agent (OTA) Booking.com and contracted accommodation providers in South Africa has been lauded as a landmark decision that will help enhance price competition and drive direct online bookings.
The global booking giant which commands a more than 50% revenue share of the OTA market in South Africa this week agreed to comply with remedial actions recommended by the Competition Commission.
The actions comprise removing the wide and narrow price parity terms from all contracts with accommodation providers in South Africa and from any criterion for participation in Booking.coms incentive programmes (Genius, Preferred Partner and Preferred Plus) or other membership programmes.
A wide price parity clause is a contractual clause that requires accommodation providers on Booking.com to publish or offer prices that are no higher than any other online travel intermediation platforms.
A narrow price parity clause requires accommodation providers listing on Booking.com to publish or offer prices that are no higher than their own direct online booking channel such as its own website.
