(Finance) – The European Commission started athorough investigation to evaluate, in accordance with the EU merger regulation, the proposed takeover by booking of Flugo Group Holdings AB, trading under the trade name eTraveli. The EU Antitrust fears that the proposed acquisition will allow Booking to strengthen its position on the Online Travel Agency (OTA) market.
Booking and eTraveli are both active in providing OTA services, respectively focusing on OTA services by accommodation and on the OTA services of flight. Booking is also active in the metasearch services (MSS) market mainly through its platform price comparison KAYAK.
The Commission’s preliminary investigation indicates that Booking may hold a dominant position on the market for the provision of OTA accommodation services and that the operation could significantly reduce competition in this market by combining the activities of eTraveli in OTA flight services with the suite of Booking services.
Furthermore, the investigation suggests that Booking may have the ability, as well as a potential economic incentive, to adopt foreclosure strategies against rival flight OTAs of Booking, how to degrade their visibility on its KAYAK price comparison platform and prevent these companies from attracting customers to their services.
The proposed transaction was notified to the Commission on 10 October 2022. Booking decided not to submit commitments during the initial investigation to address the Commission’s preliminary concerns. The Commission now has 90 working days, until March 31, 2023, to make a decision.