Government will change the online accommodation booking system in Hungary

Even though Hungary is a democratic state, PM Viktor Orbán’s Fidesz and KDNP parties enjoy a supermajority in the Hungarian parliament. Therefore, their words matter the most when problems arise. The latest issue is that Fidesz is thinking about restructuring the online accommodation booking system in Hungary. The immediate reason is the Booking.com scandal. As it is understood, a relevant bill has already been submitted to the parliament.

We have written about the scandal several times (e.g. HERE, HERE and HERE) on our site. The core problem was that the popular booking company failed to pay their Hungarian service providers for weeks. They said there was a minor mishap in their background system, but the delay brought many Hungarian accommodations to the verge of bankruptcy.

Prior to the announcement of Booking promising that the solution was on its way, Fidesz, Orbán’s party, had already launched a full-scale attack against the company. Even though they paid 98-99% of its customers, Hungary’s Economic Competition Office (GVH) urged an expedited investigation concerning payables amassed by Dutch travel agency Booking.com to Hungarian accommodation providers. The probe started after 15 August, and it is supposed to last for 30 days.

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Fidesz will turn the online booking system in Hungary upside down?

Turizmus.com, a Hungarian travel news outlet, said Fidesz announced they started negotiations on the issue with the Hungarian SME sector. They aim to prevent such adverse situations recurring in the future, Kristóf Szathmáry, an MP of the government party, told Magyar Nemzet. They are analysing the following issues:

1. Online booking companies do not have customer service offices in Hungary,
2. The general terms and conditions comprise unilateral clauses that cannot be modified by the Hungarian service providers,
3. The lack of an established authority validating such general terms and conditions,
4. Possible solutions to repel attempts to harm the interests of the Hungarian companies.
5. The possible establishment of a compensation fund.

Csaba Balázs Rigó, the head of Hungary’s Economic Competition Office, said they are monitoring the entire online accommodation booking market. They look for market distortions, biases, and abuses of dominant position. That is why they conducted on-the-spot investigations at Booking.com in Hungary and other similar online travel agencies.

In 2020, Booking got a HUF 2.5 billion (EUR 6.5 million) record fine because of aggressive sales techniques and misleading practices. GVH now investigates how the company dealt with that problem.