8-KOther Events

Booking Holdings Inc. 8-K Report, Corporate Update (Aug 9, 2013)

Filed August 9, 2013For Securities:BKNG

Summary

This 8-K filing from Priceline.com Incorporated (now Booking Holdings Inc.) on August 9, 2013, reports on the Office of Fair Trading's (OFT) intention to accept proposed commitments to close an investigation into online hotel booking practices. The investigation, initiated in September 2010, focused on allegations of resale price maintenance between Booking.com, Expedia, and Intercontinental Hotel Group (IHG). The OFT had alleged that agreements restricted Booking.com's ability to discount hotel room reservations. Booking.com disputed these allegations. The proposed commitments, if accepted, would resolve the investigation without any finding of infringement or admission of wrongdoing. Key aspects of the commitments include that hotels will retain the ability to set retail prices on online travel agencies (OTAs). However, OTAs like Booking.com would gain flexibility to offer discounts, but only to members of "closed user groups" who have previously booked through the OTA. The public comment period for these proposed commitments ends on September 13, 2013, after which the OFT will make a final decision.

Key Highlights

  • 1Booking.com (a subsidiary of Priceline.com Incorporated) and other major players in the online hotel booking sector are subject to an investigation by the UK's Office of Fair Trading (OFT).
  • 2The OFT is considering accepting "commitments" offered by Booking.com, Expedia, and IHG to close the investigation without a finding of infringement or admission of wrongdoing.
  • 3The investigation, opened in September 2010, primarily focused on allegations of resale price maintenance, where Booking.com was accused of being restricted from discounting hotel room reservations.
  • 4The proposed commitments allow hotels to continue setting their own retail prices on online travel companies.
  • 5Online travel companies will be permitted to offer discounts, but these discounts will be restricted to "closed user groups" of previously booked customers.
  • 6The OFT is seeking public feedback on the proposed commitments, with a comment period expiring on September 13, 2013.
  • 7Acceptance of these commitments would result in the closure of the OFT investigation and no imposition of fines.

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