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Austria / Constitutional Court / G44/2017 ua

Booking.com v Austria

Policy area:
Competition
Deciding Body type:
National Court/Tribunal
Deciding Body:
Constitutional Court
Type:
Decision
Decision date:
29/09/2017

Key facts of the case: 

The applicant runs an online-booking platform at booking.com. Once a room is booked, a service agreement (Vermittlungsvertrag) enters into force, the hotel guest does not have to pay any money to the platform, only the room price. At the same time there are contracts between the platform and the hotels, and for each booking, the hotel pays a certain percentage of the room price to the platform. In the contracts until end of 2016, “vertical parity clauses” were foreseen, obliging the hotels to offer the same price on the platform as on their own online-sale systems. An amendment to the unfair competition act (Unlauterer Wettbewerbsgesetz) put these clauses on the black list of dishonest practices (unlautere Geschäftspraktiken). The laws on unfair competition and the freedom to conduct business were applied in this case. The Constitutional Court referred to Articles 7 and 140 B-VG, Articles 2, 5 and 6 StGG, §§1 and 44 UWG and Z32 of the appendix to the UWG, §§7 and 17 PreisauszeichnungsG and Art 16 CFR. 

Outcome of the case: 

The Constitutional Court found that prohibiting best price clauses in contracts between booking platforms and accomodation companies (Beherbergungsunternehmen) does not violate the freedom of the right to conduct a business and the freedom of the right to inviolability of property. In addition, the Constitutional Court came to the conclusion that an interference with the freedom to the right to conduct a business is justified in view of the public interest in securing fair or free competition. In this regard, there is no inappropriate discrimination of online booking platforms compared to other travel agencies and the legislator did not exceed his legislative scope. The Constitutional Court dismissed the appelant’s application regarding the repeal of the mentioned provisions.