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CHTA rejects online travel agency's commission as grossly unfair

Friday, July 19, 2019

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MIAMI, United States (CMC) — The Caribbean Hotel and Tourism Association (CHTA) has rejected an online travel agency's commission as grossly unfair and regressive.

According to the CHTA, on Wednesday an overwhelming majority of Caribbean hotels said they were reconsidering using Booking.com as a result of the new commission policy that they claim is aimed at generating additional revenue for the online giant at the expense of consumers, the region's destinations, hotels, and employees.

The CHTA has called for the immediate ending of the policy.

In a letter to Booking.com, CHTA cited “a strong negative backlash” from members, “particularly how it cuts into employee tips and gratuities”.

The association pointed to a recent survey of its 33 national hotels and tourism federation associations and hotels, which it said “revealed a belief the commission policy was 'regressive and punitive' adding to Booking.com's revenue while reducing the profitability of the Caribbean tourism industry, hotel operations, and the earnings of many of the region's employees.”

CHTA's chief executive officer and director general Frank Comito said the commissions would “directly affect travellers because some of the higher costs associated with additional payments to Booking.com will need to be shared by the travelling public, as some hotels seek to recoup losses by raising prices.

“In a region where consumer price sensitivity and high operating costs are an ongoing challenge, this presents the industry with an added predicament,” he said.

But Comito also cautioned that while the commissions would be a short-term profit for the online travel agency, it “could eventually be a significant long-term loss for the company, as 84 per cent of hotels surveyed are reconsidering using Booking.com as a result of the new policy.

CHTA said more than 60 per cent of hotels reported that the commission policy will result in changes in how they assess and/or cover these charges, which survey respondents indicated included: increasing rates; deducting the commission from the tip/gratuity amount paid to employees; no longer accepting bookings from Booking.com; or reconsidering the discounted percentage offered to Booking.com.

The region's tourism and hotel association said among the actions a number of hotels considered taking, unless the policy is removed or revised, are applying a fee surcharge to customer billings to recover the added cost and using other booking platforms.

Referring to trade media reports that certain areas of the world or major brands might be exempted from the Booking.com commission policy, the CHTA said small-medium sized hotels and some luxury properties, are already disadvantaged because of the marketing and buying power of hotel brands and major destinations.

In its communication to Booking.com, the CHTA noted that small- and medium-sized independent hotels have supported the company from its inception, stating that “those who have helped you the most stand to lose even more as this policy impacts their bottom line.

“Without further consideration and a reversal of your policy, we can only advise hotels to reassess their use of your platform and consider placing added emphasis on other booking options,” said the CHTA.


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