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Industry body FHRAI, LocalCircles write to commerce ministry, ministry of consumer affairs to include OTAs in e commerce rules

LocalCircles said it has received lots of feedback on draft e commerce rules as well as the workings of online travel and accommodation booking sites and that as per a recent consumer survey conducted on the subject, 60% of the consumers felt conv...

, ET Bureau|
Nov 01, 2019, 09.22 AM IST
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Agencies
Ecommerce
Online travel and accommodation marketplaces are currently not included in the draft e commerce rules.
New Delhi: Apex industry body Federation of Hotel and Restaurant Associations of India (FHRAI) and LocalCircles, a social media platform that has worked with the ministry of consumer affairs in the past for gauging consumer feedback on certain issues like MRP and enforcement of weights and measures under the Legal Metrology Act have written to the commerce ministry and the ministry of consumer affairs to bring all travel and accommodation marketplaces under the e commerce rules. Online travel and accommodation marketplaces are currently not included in the draft e commerce rules.

Gurbaxish Singh Kohli, vice president of FHRAI said after writing to the commerce ministry last month, the association has been asked by the ministry to prepare a set of documents on the matter and that it is in the process of doing so while in a letter to the ministry of consumer affairs on Thursday, Local Circles wrote high convenience fee which is not disclosed to the consumers till the very end and a lack of trust at the time of cancelling bookings were key challenges for consumers in the space and that just like returns and timely refunds are critical to the product e commerce marketplaces, timely booking cancellations and refunds or standard convenience charges will help in ensuring that the consumer interest is effectively protected.

In its letter to the ministry, a copy of which ET has seen, LocalCircles said it has received lots of feedback on draft e commerce rules as well as the workings of online travel and accommodation booking sites and that as per a recent consumer survey conducted on the subject, 60% of the consumers felt convenience fee is not disclosed to the consumer till the very end and that only 33% of the consumers felt hotel reviews on online travel apps reflect the reality and are generally biased in favour of the consumer. LocalCircles has proposed that all travel and accommodation booking marketplaces and apps should be brought under the e commerce rules under the Consumer Protection Act as it will help bring all travel and accommodation marketplaces and apps to a common basic standard.

Industry insiders familiar with the developments said there is a chance that online travel agents and accommodation marketplaces might end up getting included because of sustained pressure from hoteliers against companies like Go-MMT on matters like deep discounting.

“Hoteliers have been complaining that they are getting squeezed by the big players like Go-MMT. For airlines also, sometimes the OTA offers are cheaper than what you get on airline websites but, airlines are not complaining because they are getting their money,” said the head of an OTA on condition of anonymity.

“The inclusion could be a good thing from a regulatory point of view to put some sense into businesses that businesses should not be focused on gross merchandise value alone but should also be sustainable and profitable after a point,” he added.

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