Can You Offer a Lower Price on Your Website Than on OTAs?

If you manage a hotel or non-hotel accommodation (such as a vacation rental or B&B), you have likely asked yourself this question dozens of times: “Can I publish a lower price on my website compared to OTAs, or do I risk penalties and sanctions?”

It is a completely understandable doubt. For years, the fear of “displeasing” online booking giants has held back many property managers from taking control of their direct channels.

In this article, we clear things up once and for all: looking directly at the laws and contracts, we give you the definitive answer and explain how to proceed in complete safety.

Airbnb and Rate Parity: what do the terms of service say?

First of all, it must be said that not all OTAs are created equal: or rather, there are platforms born as Online Travel Agencies, like Booking.com, and those born as sharing economy platforms, like Airbnb (even if distinguishing them today is practically impossible).

In Airbnb’s Terms of Service for hosts, there is no clause forcing you to offer “equal or better” prices compared to your website or other channels.

In fact, Section 4.1 explicitly states:

“As a Host […] you are in control of how you host: you set your price, availability, and rules for each Listing.”

Therefore, Airbnb does not monitor at all whether your property’s price is lower on your website, on Booking, or anywhere else, and it applies no penalties if you sell for less elsewhere.

Booking.com and the “Rate and Condition Parity” clause

The story changes slightly for traditional OTAs, such as Booking.com. In fact, in Booking.com’s contract, which we all accept (more or less consciously), clause 2.2.1 states:

“The Accommodation Provider guarantees Booking.com ‘Rate and Condition Parity’, meaning equal or better rates for the same Accommodation Provider, room type, dates, bed type, number of guests, same (or better) included and additional services (e.g., free breakfast, Wi-Fi, early check-in / late check-out), and same (or better) restrictions and policies, such as booking modifications and cancellation policy, compared to those made available by the Accommodation Provider.”

This is the so-called “Rate Parity.” Put simply, accommodation properties that have a website or promote themselves through other channels were not allowed to offer more advantageous rates than those listed on Booking.com.

The legal turning point in Italy: the 2017 Competition Law

But here comes the good news. In Italy, as far back as 2017, the Market and Competition Law came into force ( Legge n. 124/2017, Articolo 1, Comma 166 ) which explicitly reads:

“Any agreement by which a tourism-accommodation business undertakes not to offer end customers—by any means or instrument—prices, terms, and any other conditions that are more favorable than those offered by the same business through third parties shall be null and void, regardless of the law governing the contract.”

What does this mean? That any clause in Booking.com, Expedia, or other OTA contracts requiring an Italian property not to offer lower prices on its own website (or other channels) was outlawed under national law.

The European context: the Digital Markets Act and clause 2.2.6

Not only that. In 2022, the European Union passed the Digital Markets Act (DMA), a law created to make markets in the digital sector fairer and more contestable. The DMA establishes objective criteria to identify so-called “Gatekeepers”—entities that control access to the market.

In May 2024, the EU officially designated Booking.com as a Gatekeeper, requiring the holding company to adapt its contract within six months.

That is why in November 2024, Booking had to add a new clause to its General Terms and Conditions—point 2.2.6—which reads:

“Points 2.2.1 and 2.2.2 DO NOT APPLY to accommodations located in No Parity Countries,” which refers to all countries in the European Union.

The definitive answer: is it legal to sell for less on your own website?

The definitive answer is YES: if you operate in the European Union, as of November 2024, all accommodation properties can legally offer more advantageous rates on their own website or other channels compared to OTAs.

Beyond the Contract: The Obstacle of Booking.com’s Algorithms

But beware: Just because the law and the contract allow you to list a lower price on your website, does that mean you can do so with zero consequences?

Booking.com, like other OTAs, uses complex algorithms to index listings, measuring performance and constantly monitoring prices across the web. If these algorithms detect that a room costs less on your website than on Booking, they could penalize your property’s visibility in search results (and we can never know the exact impact of these penalties with complete certainty).

Fortunately, the European Union protects us from this risk. With the entry into force of the Digital Markets Act, the EU has the power to monitor Gatekeepers’ algorithms. If the EU were to discover that Booking inserted lines of code saying “if the price on Hotel X’s website is lower, lower its ranking by 20 positions,” Booking would risk fines of up to 10% (and up to 20% in cases of repeated infringement) of its global annual turnover (we are talking about billions of euros).

However, there is a completely legitimate mechanism at play: the drop in Conversion Rate. How does it work?

• A user searches for a hotel on Booking, looks at photos, and reads the room description.
• The user searches for your hotel on Google, finds your direct website, and books directly.
• Booking registered a view (Look), but did not get the booking (Book) and its corresponding commission.

If this behavior happens frequently, your conversion rate on the platform drops.

This happens because Booking’s algorithm is designed to display at the top the properties that guarantee the highest financial return per click. Consequently, a listing that converts less traffic will naturally lose positions in search result pages.

This drop in visibility is completely legitimate because it is not a penalty for your lower price, but a simple statistical consequence: your listing on Booking is converting less traffic into revenue for the platform.

How to manage a direct pricing strategy intelligently

Understanding these mechanisms allows you to stay ahead of the game. Remember that securing a zero-commission direct booking more than compensates for a minor drop in OTA visibility.

However, to build your direct channel sustainably without giving up the exposure provided by OTAs, the best approach is to implement these strategic levers:

1. Instead of lowering the public price visibly on your website, keep rates aligned and apply a discount (e.g., 10%) via a promo code unlocked at checkout or reserved for newsletter subscribers. This way, you convert the user without negatively impacting public price-comparison metrics.
2. Beat OTAs on value at the same public price. Offer direct bookers free perks that Booking cannot match, such as a welcome drink, late check-out, or free parking.
3. Leverage Booking.com as an advertising showcase (Billboard Effect) during low-demand periods to attract new guests, and push hard for direct bookings during peak demand periods when you don’t need intermediaries to fill your property.

Boost Your Direct Bookings with Destinalytics

Increasing your direct profit margin requires a perfect balance between legal strategy, price positioning, and website optimization.

At Destinalytics, we help hotels and alternative accommodation providers build a solid, measurable, and data-driven direct channel.