Hotels

Labor to give small hotels pricing power if elected

The Australian Labor Party has pledged to remove parity-price clauses currently shackling small hotels if it wins the federal election.

Under current laws, parity-price clauses stop small hotels from offering discounts if they also advertise with large platforms like Expedia or Booking.com.

The two large platforms currently control more than 80 per cent of the Australian bookings market and collect up to 30 per cent of booking fees.

By removing parity-price clauses, small businesses will be able to set their own prices.

As reported by the Australian Associated Press, Labor’s competition spokesman, Andrew Leigh, said the clauses had been hurting local accommodation providers.

“We don’t think that that’s appropriate, to have that amount of revenue going to a multinational platform, which is effectively then saying to the hotel ‘you’re not allowed to offer a better rate on your own website’,” he said.

Similar parity-price clauses have been banned in European countries, including Germany, Italy, France, Sweden, Belgium, and Austria.

A Shorten Labor government would also direct the competition watchdog to investigate the use of such clauses across other platforms and industries.

Small Business and Family Enterprise Ombudsman Kate Carnell welcomed Labor’s proposal.

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