The Supreme Court upheld an earlier decision by the German cartel authority that banning hotels from advertising lower prices on their own websites was “not compatible with cartel law”.
The Federal Cartel Authority had in 2015 prohibited Booking.com from continuing to apply so-called “narrow” best-price clauses in the country.
Under the clauses, hotels were obliged to always offer Booking.com their lowest room prices, maximum room capacity, and most favourable booking and cancellation conditions available on all online and offline booking channels.
Booking.com had successfully challenged the decision at a higher regional court in 2019, but the Bundeskartellamt then launched an appeal.
Andreas Mundt, president of the Bundeskartellamt, welcomed Tuesday’s ruling and said best-price clauses could “hinder competition between platforms”.
“They can work to the disadvantage of the providers — such as hoteliers in this case — and mean higher prices for consumers,” he said.
Amazon had already abandoned similar clauses for merchants on its Marketplace platform in 2013 after intervention by the cartel authority.
The regulator has also banned Booking.com rival HRS from using best-price clauses.
In other European countries, best-price clauses have been prohibited by law.
Mundt said the Supreme Court decision had “paved the way for us to take a differentiated view of such clauses depending on the industry and market position of the platform”.