The UK competition watchdog has launched an investigation into hotel booking websites amid concerns they could be misleading customers.
The Competition and Markets Authority (CMA) said it was concerned about the clarity, accuracy and presentation of information on sites.
The investigation was welcomed by the British Hospitality Association (BHA), which represents thousands of businesses including hotels and restaurants.
The CMA will examine areas such as search result rankings, “pressure selling”, hidden charges, and discount claims.
If it finds sites are false or misleading and breaking consumer law, the CMA could take enforcement action.
The CMA has written to companies across the whole sector asking for information about their practices and is also calling on customers and hotels to share their experiences.
The watchdog will examine practices such as how hotels are ranked after a customer has made a search – and whether this is influenced by a commission paid by the hotel.
It will also look at “pressure selling”, and whether claims about how many people are looking at the same room, how many rooms are left, and how long a price is available, may create a false impression or rush customers into making a decision.
Claims about discounts are to be reviewed to see if they offer a fair comparison, as will the issue of hidden charges such as taxes or booking fees which customers may be faced with in addition to the prices they are first shown.
CMA chief executive Andrea Coscelli said: “Around 70% of people who shopped around for hotels last year used these sites and they should all be confident they have chosen the best accommodation for their needs and are getting a good deal.
“In today’s increasingly busy world, sites like this offer real potential to help holiday-makers save time and money searching for their ideal get-away.
“To do this, sites need to give their customers information that is clear, accurate and presented in a way that enables people to choose the best deal for them.
“But we are concerned that this is not happening and that the information on sites may in fact be making it difficult for people to make the right choice.”
BHA chief executive Ufi Ibrahim said it was delighted that an investigation had been launched.
He said: “Many of our members have been concerned about the vast power of online booking agencies often charging high rates of commission, use of misleading information, pressure selling, and a lack of transparency.
“In the process guests are paying more than they should for rooms.”
The CMA expects to report back on the investigation by next spring.
Any enforcement action could include asking websites to change their practices, obtaining a court order for them to do so and eventually a significant fine.
No specific sites have been named by the CMA.
Leading operators in the sector include booking.com, Expedia, Trivago and hotels.com.
Trivago – majority owned by Expedia – said in a statement that it would “work with the CMA to explain the benefits it delivers to consumers looking for their ideal hotel”.
Expedia, which also owns hotels.com, said: “We welcome further discussion with the CMA to review how platforms provide transparency to the market increasing competition between hotels and to increase consumer benefit.”
Booking.com said it would not be commenting.