GVH slaps Booking.com with its largest-ever fine

The Hungarian Competition Authority (GVH) has imposed its largest-ever fine in a follow-up investigation for failure to comply with obligations to cease previous infringements. Booking.com, one of the world's largest online accommodation booking platforms, persisted in unlawful communication practices and disseminating urgent information that could psychologically influence consumers. As a consequence of this behaviour, GVH fined the company nearly 400 million HUF in this follow-up investigation.

In 2018, GVH initiated competition proceedings against Booking.com B.V. after finding the company engaged in unfair commercial practices. The company's advertisements prominently featured the option to cancel accommodations free of charge, albeit within a limited timeframe and at higher prices. Additionally, Booking.com psychologically influenced consumers by misleadingly stressing limited availability due to popularity, thereby potentially inducing rushed bookings. Moreover, the company failed to accurately display the SZÉP card payment option, breaching professional diligence requirements.

In response to these infringements, GVH's Competition Council levied a 2.5 billion HUF fine in April 2020 and prohibited Booking.com from using misleading information regarding "free cancellation" and urgent messages employing psychological pressure to influence consumers.

In its recent press release, GVH underscored its commitment to diligently monitor compliance with its decisions: "In all cases, GVH will meticulously uphold the obligations set forth in its decisions." Subsequent investigations revealed Booking.com had not fully adhered to these obligations. Despite scaling back and modifying its use of urgent messages, the company continued employing claims likely to psychologically influence consumers until February 26, 2024, and ceased using the "free cancellation" slogan only by April 26, 2024.

Ultimately, GVH's Competition Council imposed a fine of 382.5 million HUF on Booking.com for these infringements, marking the highest fine ever imposed in a follow-up investigation. The Council considered the company's decision to waive its right to appeal and forego a hearing, as well as its cessation of infringing behaviour during the final stages of the procedure.

The GVH's decision and the record fine imposed on Booking.com serve as a significant reminder to all businesses: strict and complete compliance with competition authorities' decisions and obligations is not only ethically imperative but also legally binding. The breaches identified by GVH underscore the importance of providing consumers with accurate information and adhering to market competition rules for sustained business success. This case highlights the value for companies in investing in proactive legal compliance measures rather than facing fines. Compliance can mitigate financial penalties, safeguard corporate reputation, and bolster consumer trust.