Skift Take
Booking Holdings CEO Glenn Fogel said the company would appeal the Spanish competition authority’s $530 million draft decision if it becomes permanent.
Spanish regulators levied a $530 million fine against Booking.com in the fourth quarter in a draft decision, Booking Holdings announced Thursday.
CEO Glenn Fogel said the Spanish National Markets and Competition Commission (CNMC) found that Booking.com infringed on competition law in that country.
“We could not disagree more with this draft decision and the arbitrarily large fines that they have proposed, which is completely disproportionate to the alleged conduct,” Booking Holdings CEO Glenn Fogel told financial analysts during the company’s fourth quarter earnings call Thursday.
He said the company will appeal the fine if the draft decision becomes permanent.
Booking.com is the largest online travel agency and accommodations provider in Spain and Europe.
The fine in Span comes on top of the European Union’s looming regulatory action against Booking.com based on the Digital Markets Act.
“As we have previously disclosed, we plan to file our notification for designation under the DMA soon,” Fogel said. “And we believe the main concerns raised by the Spanish authority overlap with the DMA. We will continue to work closely with these regulatory bodies to maintain consistent rules.”
A Decision Against Booking.com in the Netherlands
Booking Holdings also took a $276 million loss in the what the company described as “the Netherlands pension fund matter.” In that issue, The Hague ruled that Amsterdam-headquartered Booking.com is indeed a travel agency and therefore must participate in the PGB Pension Fund.
In prior eras, Booking.com could argue it was a technology company and not a travel agency – it facilitated guest bookings but guests generally paid for rooms at the hotel. But over the past few years, Booking.com has been collecting money for hotels through prepaid guest bookings.
In fact, during Thursday’s fourth quarter earnings call Fogel said that in 2023 about half of Booking.com’s global bookings were tied to the company’s merchant payments platform, where Booking.com is the merchant of record, and not an agent of the hotel as it was, as a rule, in years’ past.
The Fines and Penalties Adversely Impacted Earnings
Booking Holdings did not include the losses of $530 million and $276 million, totaling $1.016 billion, in its non-GAAP or adjusted EBITDA numbers for the fourth quarter and full-year 2023.
On a GAAP basis, Booking’s fourth quarter net income fell 82% to $222 million. Revenue jumped 18% to $4.8 billion.
For full-year 2023, Booking’s net income rose 40% year over year to $4.3 billion on revenue of $21.4 billion, a 25% increase.
Connected Trip Progress
For the past few years, Fogel has been pursuing a connected trip strategy where travelers would enjoy a seamless and personalized travel experience whether they booked a flight, car, hotel, short-term rental, package or attraction on Booking.com.