Booking.com now under purview of EU's Digital Markets Act regulations
What's the story
Booking.com, a leading online travel agency, has been designated as a 'gatekeeper' under the European Union's Digital Markets Act (DMA).
This classification subjects the company to the EU's market fairness and contestability framework.
Non-compliance with these regulations could result in substantial fines, potentially amounting to 10% or even 20% of the company's revenue.
This move is anticipated to foster a more competitive and fair market environment.
Compliance deadline
Six-month window to align with DMA
Booking.com has been granted a six-month period to comply with most of the DMA's stipulations.
These include implementing Fair, Reasonable, and Non-Discriminatory (FRAND) terms and conditions for business users, and prohibiting self-preferencing.
Certain rules under the DMA, such as the necessity to inform the EU of planned acquisitions, are immediately enforceable.
Market
DMA designation expected to enhance customer choices
The European Commission expects that Booking.com's designation as a gatekeeper will improve options for holidaymakers. Margrethe Vestager, the European Commissioner for Competition, stated, "Holidaymakers will start benefiting from more choice and hotels will have more business opportunities."
Tech oversight
Joining tech giants under DMA regulations
Booking.com is the seventh company to be classified as a gatekeeper under the DMA, following Alphabet, Apple, Amazon, Meta, ByteDance, and Microsoft.
These companies were designated last September. Since then, the EU has initiated non-compliance investigations into Alphabet, Apple, and Meta's compliance proposals.
Booking.com was not included in the initial wave of designations due to the pandemic's impact on its business.
Recovery impact
Booking.com's designation follows business recovery
Booking.com anticipated its DMA designation as its business recovered from the pandemic.
The DMA requires tech giants to notify the Commission when they exceed 45 million monthly active users, and over 10,000 yearly active business users.
Booking.com met these requirements on March 1, triggering a review process by the Commission that led to its current gatekeeper status.
Company statement
Booking.com's response to DMA designation
In response to the EU's decision, a spokesperson for Booking.com stated, "We have been working with the European Commission for some time as we anticipated today's decision."
"We are reviewing their designation decision now and will continue to work constructively with them as we develop solutions to comply."
The company is committed to aligning its operations with the DMA regulations.