The ongoing dispute between online aggregators and key industry associations has taken a new turn. The apex hospitality body, The Federation of Hotel & Restaurant Associations of India (FHRAI) has evoked new norms set by commerce ministry to curb predatory pricing of e-tailers to submit its case with the Ministry of Tourism (MoT). The body has requested the MoT for “its urgent intervention for redressal of hoteliers’ grievances” in a letter addressed to Union Minister of State for Tourism K J Alphons. In its letter, FHRAI has highlighted the plight of hotel owners who have found their sustenance difficult against “predatory pricing” and “a large-scale breach of contract.” Illegal hosting of Bed and Breakfast (B&B) and exorbitant commissions were some other major concerns outlined in the memorandum.
Commenting on the development, Gurbaxish Singh Kohli, Vice President, FHRAI & President, Hotel and Restaurant Association of Western India (HRAWI) noted that budget and mid-market hotels had faced most of the brunt of the “adverse business tactics” of online players. “The OTAs’ malpractices are affecting the hoteliers’ livelihood and business. The FHRAI has tried to resolve the issue directly with the OTAs, instead, its CEO has chosen to dismiss FHRAI’s role in the matter. It leaves us with no choice but to ask for the Government to step in and create a norm for the OTAs just as the Commerce Ministry has done for the e-tailers recently,” he said.
We had reported that, only recently, the Hotel and Restaurant Association of Odisha (HRAO) has passed a resolution banning MMT from making reservations post 15th of January next year. Hoteliers in Gujarat and Maharashtra, among others, have voiced similar concerns against the OTA business model. The ball is now in the government’s court. It will be interesting to see how the MoT responds to the demand of instilling regulation in the OTA space.