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The Office of Fair Trading expects that UK hotel prices should fall following the end of its investigation into the fixing of discounts.
The OFT investigated hotel chain Intercontinental Hotels Group (IHG) and two major online travel agents (OTAs) Expedia and Booking.com over separate agreements which restricted the level of discounts for selling room-only accommodation at hotels in the UK.
The three companies made a series of commitments to resolve this issue which have now been accepted by the OFT.
These commitments mean that other OTAs and hotels which work with these three businesses will be able to offer discounts on “headline” room-only rates as long as their customers sign up to a membership scheme or make one full-priced booking with them.
Ann Pope, senior director in the OFT's services, infrastructure and public markets group, said: “The travel industry, fuelled by the internet, has seen significant changes in recent years, and we want to ensure those changes continue to work in consumers' interests.
“That is why we are pleased to have secured this outcome which, by allowing OTAs and hotels to offer discounts, should increase competition and mean travellers across Europe can benefit from reductions on hotel accommodation throughout the UK.
“By shopping around, people can compare the different discounts offered by hotels and OTAs, and ensure they get the best deal.”
The commitments made by IHG, Expedia and Booking.com apply to bookings made by residents of the European Economic Area (which includes the 27 EU countries plus Iceland, Liechtenstein and Norway) for hotels in the UK.