Aggregators penalised, Hospitality wins

Competition Commission of India (CCI) recently levied penalties of `392 crore on MMT-Go and Oyo after finding them in contravention of the law. Federation of Hotel & Restaurant Associations of India (FHRAI) terms the order a big win for the hospitality industry against the dominance of aggregators.

TT Bureau

Based on complaints filed by India’s apex hospitality association, the Federation of Hotel & Restaurant Associations of India (FHRAI), in 2019 against Oyo and MMT-Go, the Competition Commission of India (CCI) found the aggregators to be in contravention of the law and has imposed a penalty of `223.48 crore on MMT-Go and `168.88 crore on Oyo. The aggregators were found to be indulging in predatory pricing, charging exorbitant and unfair commissions, misrepresentation of information and levying service fees arbitrarily. Welcoming the order, FHRAI termed it one of the biggest wins for the hospitality industry against the dominance of the aggregators. The association stated that the case will also serve as an eye-opener for investors and the regulatory bodies regarding unethical conduct of Oyo, which is planning go public.

“This is by far one of the biggest wins for the hospitality industry against the dominance of the aggregators. We see this as a major verdict that will go a long way in disciplining the OTAs and saving the hospitality industry. The actions of Go-MMT and Oyo have individually as well as collectively caused immense damage to local hotels across all segments. Oyo is responsible for the systemic depredation of the budget segment hotel business and its market as a means to achieve a notional billion-dollar valuation, which is a serious cause of concern for the hospitality ecosystem of the country. We need to create a level playing field for the sustenance and growth of the industry which in the recent past witnessed the dilution of fundamental business ethics,” says Pradeep Shetty, Executive Committee Member, FHRAI.

Illustratively, for properties listed on MMT-Go but sold out on the said portal by virtue of exhaustion of quota allocated to MMT-Go, may specify ‘sold out on MMT-Go portal’; similarly, properties continuing to be appearing on MMT-Go portal, despite termination or expiry of listing arrangement should be removed from the portals and in the interregnum with a ‘not available on MMT-Go portal’ specification.

The commission has directed MMT-Go to weed out anti-competitive practices and to implement the directions of the CCI in its true import and spirit. MMT-Go is further directed to submit a compliance report, on an affidavit, with regard to the aforesaid directions within 60 days of the receipt of the order.

HRAWI convention a success

The Hotel & Restaurant Association of Western India’s (HRAWI) 19th Regional Convention held in Nashik recently saw great participation from stakeholders. Shetty says, “The convention offered hoteliers and restaurateurs an opportunity to express and share experiences from the days of the pandemic
induced lockdowns.