Regulatory and Legal Affairs

💾 Booking.com, identified as a gatekeeper under the DMA, faces issues with hotels over pricing and data sharing. HOTREC and IHA express the need for transparent discussions and adherence to new obligations. With over 70% market share, Booking.com's dominance is highlighted in HOTREC's 2022 study, an updated version due in June 2024. HOTREC and European Commission have released statements regarding the situation.

🚬️ On 18 September 2024, HOTREC responded to the European Commission’s revised recommendation on smoke-free environments. The organization supports the aim to shield EU citizens from second-hand smoke, but questions the impact of extending smoke-free areas to hospitality venues’ outdoor spaces. HOTREC calls for a thorough evaluation of the potential social and economic effects on tourism and hospitality sectors before implementing such a ban.

🚨 Jeremy Frost and Patrick Wadsted of Frost Group Limited were appointed as liquidators for Viral Ventures UK after a winding up petition by a creditor. Viral Ventures UK owes over £400,000 and has ceased trading, impacting its 77 staff and over 2,500 clients with prepaid events. Karen’s Diner, part of Viral Ventures, retracted UK expansion after closing all but its London Angel site. They planned a summer pop-up tour from June to September. Clients with deposits for future events should contact credit card providers for potential refunds.

🏡 HOTREC, representing European hospitality, announces its move to a new office at Square de Meeûs 23, Brussels, in the EU quarter, near the European Parliament. Roberta Metsola (EPP, Malta) remains the President of the European Parliament after MPs gather in Strasbourg for the plenary session. The July newsletter mentions the upcoming collaboration on key EU policies affecting tourism and hospitality, and includes an interview on the Hungarian Presidency. Activities will resume in September after a summer break.

📝 The EU Packaging and Packaging Waste Regulation (PPWR) deal approved by EU ambassadors raises HOTREC's concerns about the balance between environmental goals and industry needs. The Digital Markets Act's (DMA) implementation is key as there are issues with Google's search visibility for direct suppliers, paralleled by Booking.com's impending gatekeeper status designation. Labour shortages in the hospitality industry prompt the EU to present an action plan on Labour and Skills, while the EU Talent Pool proposal seeks to improve labour mobility. Meanwhile, HOTREC prepares for its General Assembly in Budapest on April 24-26, 2024.

💰 The 80/20 labor rule was abolished by the Fifth Circuit Court of Appeals this month, branded “arbitrary and capricious.” Originally enacted under Obama, rescinded by Trump, and revisited with clarifications under Biden, the rule restricted employers to pay a subminimum wage ($2.13 per hour) for tip-earning tasks. A tipped employee exceeding 20% of their workweek on non-tip tasks, or 30 consecutive minutes, couldn't receive a tip credit. Businesses now revert to the baseline tip credit rule unless state law dictates otherwise. Labor law changes over administrations cause operational complexities for business owners. Six states have their own 80/20 rules. The Department of Labor is unlikely to reintroduce the same rule but may seek other methods to regulate tipped employee pay following legal precedents set by Loper Bright Enterprises v. Raimondo and the overruling of Chevron deference.

🚫 The Dutch DPA found Uber in violation of GDPR by transferring European drivers' sensitive data to US servers for over 2 years without adequate transfer tools, post-EU-US Privacy Shield invalidation in 2020. Uber, with a €34.5 billion turnover in 2023, faces fines up to 4% of its annual turnover. This case follows 170+ French drivers' complaints via LDH to the French DPA, leading to an investigation by the Dutch DPA—Uber's European HQ. Uber has been fined twice before by the Dutch DPA: €600,000 in 2018 and €10 million in 2023.

🍴 Nourish Scotland, a food policy NGO, proposes a 'national restaurant service' to tackle health inequality, food insecurity, and climate change in the UK. Their upcoming report "Public diners: the idea whose time has come" advocates for state-subsidized eateries offering quality, ethically sourced food. Citing poor diets as a leading cause of preventable ill health, Nourish Scotland draws inspiration from the 2,000+ wartime British Restaurants established by Winston Churchill in 1940. Dr. Christian Reynolds supports the initiative, highlighting positive health, economic, and sustainability outcomes.

🏨 Marriott recently licensed the Sonder brand for its long-stay property portfolio. Sonder, a tech-led long-stay brand, experienced IPO difficulties but saw its share price double after announcing a strategic agreement with Marriott and securing $143 million in new funding. The partnership enhances Sonder's appeal to real estate owners by combining its product with Marriott's distribution network. This move signals a potential shift towards hotels becoming more consumer-focused brands.

🚂 Amtrak to restore Gulf Coast route connecting Mississippi, Alabama, and Louisiana, halted since Hurricane Katrina in 2005. Mobile City Council approved $3 million funding, part of the total $178.4 million budget, including federal grant and state contributions. Service will include twice-daily trips, stopping in four Mississippi cities, with hopes to launch by February 2025, ahead of Super Bowl LIX and Mardi Gras in New Orleans.