OYO and MMT-Go fined Rs 392 crore, Competition Commission takes action
As per the CCI decision, MMT-Go and OYO have been fined Rs 223.48 crore and Rs 168.88 crore at the rate of 5% of their turnover.
Rs 392 crore fine on OYO and MMT-Go
The Competition Commission has taken strict action against the big names of the online travel and hospitality sector for taking wrong advantage of their position in the market and breaking the rules of competition. CCI Today, MakeMyTrip- GoIbibo (MMT-Go) and Oyo have been fined Rs 392 crore. These companies are accused of misusing their positions to eliminate competition. Due to which other companies and service providers have suffered losses.
Instructions to companies to change the rules
Along with imposing penalties on companies, the Competition Commission has directed them to modify their terms of agreements with hotels and chain hotels so that other platforms in the sector get full opportunities. In fact, MMT-Go is alleged to have entered into an agreement with its hotel partner on such terms that the hotel partner would in any case pay less than the rate of fare being offered on the MMT-Go platform, either by himself or through any other platform. Could not offer rooms.
CCI has asked MMT-GO to modify any such conditions regarding fares and room availability as necessary so that these hotels can do business with other online travel agencies. Along with this, CCI has also asked to remove many other exclusive conditions in the agreement. CCI has said in its decision that MMT-Go should place hotels and chain hotels on its platform in a fair and transparent manner. For this, they should improve the terms and conditions of listing on the platform as per the need.
what is the whole matter
MakeMyTrip i.e. MMT had acquired Ibibo Group Holding in the year 2017. MMT continued its hotels and travel package business under the MakeMyTrip brand name through MMT India and the Goibibo brand through Ibibo India. MMT-Go removed OYO’s competitors from its online portal in 2018. After which, in October 2019, orders for investigation were issued in this case. The job of CCI is to maintain the competition in the business. The Competition Commission oversees matters relating to agreements between companies in business that will deliberately affect the business of other companies.