India’s competition regulator said on Wednesday that it had fined online hotel-booking companies MakeMyTrip Ltd Goibibo and IPO-bound hotel chain Oyo a combined $47 million for anti-competitive behaviour.
The Competition Commission of India (CCI) has been investigating the companies since 2019 following allegations by a hotel body that MakeMyTrip gave special treatment to SoftBank-backed Oyo on its platform.
The CCI has directed MakeMyTrip and Goibibo (MMT-Go) to amend their market behaviour after fining them about $27 million. Oyo was fined $20 million.
OYO and MakeMyTrip were reviewing the CCI order, the companies said in separate statements issued late on Wednesday.
“OYO believes that our business practices and conduct comply with all applicable laws and will take all necessary steps to explain our position in the appropriate forums,” the company said.
MakeMyTrip is a pure-play marketplace with no supply side leaning, a company spokesperson said. “We anticipate that the order will have a negative impact on the level of competition and growth of the ecommerce market in India.”
The Federation of Hotel and Restaurant Associations of India (FHRAI) had alleged that agreements between Oyo and Nasdaq-listed MakeMyTrip to give preferential treatment to Oyo on its platform were restricting market access to competitors such as Fab Hotels and Treebo.
“The Commission is of the view that the commercial arrangement between OYO and MMT-Go which led to the delisting of FabHotels, Treebo and the independent hotels, which were availing the services of these franchisors, was anticompetitive,” the CCI said in its order.
The FHRAI had also alleged that Oyo and MakeMyTrip were hurting competition by offering deep discounts and charging “exorbitant” fees from hotels.