Online travel booking startup Nustay has filed a complaint with the European Union’s antitrust regulator, the European Commission, accusing Expedia Group and Booking Holdings of breaching the region’s competition rules.
The Danish company has claimed that its bigger rivals are trying to “kill off” the startup, as well as punish hotels that appear on its site. Nustay argued that Expedia and Booking are also trying to maintain “artificially high price levels” for hotel rooms (which will keep their commissions high) by preventing Nustay from offering lower prices.
Nustay added that both Expedia and Booking downgraded hotels in their search rankings if a hotel’s prices were lower on a competing website, which has led those properties to pressure Nustay to raise prices so they wouldn’t lose more business on the other sites.
“We really have the possibility to give a better product to the consumers at a lower price, but we are seeing a tremendous effort from Expedia and [Booking] to kill us before we even get a chance to get a foothold, “ said Nustay CEO Mathias Lundoe Nielsen in an interview, according to Bloomberg.
The company filed the complaint to try to get fair terms, and “show how big of a problem it actually is,” he noted.
In one email exchange between a European hotel and Nustay, for example, the owner said, “We have been contacted by both of our partners, Expedia and [Booking]; they both have asked us to contact the ones that are not in line with the prices we communicate.”
Another hotel explained in a separate email, “I am being penalized by [Booking] and Expedia because you are selling bedrooms at my properties cheaper than they are able to.”
In addition, Lundoe Nielsen revealed that Expedia directly urged Nustay to raise its prices on Google Search — right before it terminated a partnership with the company. Booking, Expedia and the European Commission didn’t immediately respond to a request for comment.