Who: The European Commission v Hertz/Avis/Europcar/Sixt/Europcar/Goldcar
Where: The European Union
When: 28 October 2014
Law stated as at: 4 December 2014
In July 2014, the European Commission sent a letter to six car rental companies requesting that they end online practices which discriminated against consumers on the basis of their country of residence.
The discriminatory practices included car rental companies rerouting the consumer automatically to a national website with higher prices once their IP address had been identified, or preventing the consumer from completing bookings online on the basis of their IP address or by increasing the price once the consumer entered their country of residence on the website.
This resulted in consumers who were going online to rent cars facing different prices depending upon where they lived in Europe. An example was a German consumer using a car rental company’s website to book a rental car in the UK. Once the consumer put in their country of residence as Germany on the website, the price of the rental car doubled.
These practices were found to breach Article 20(2) of Directive 2006/123/EC of 12 December 2006 on services in the internal market; constituting unjustified discrimination of consumers based on their nationality or residence as consumers were treated differently depending upon their country of residence.
In their letter, the Commission requested that the car rental companies confirm that they would review their practices. The response of Sixt, Enterprise and Goldcar were found to be satisfactory, but the answers of three car rental companies Europcar, Hertz and Avis were found by the Commission to be unsatisfactory. The Commission made public the letter sent to these companies and requested further follow-up from the car rental companies by 30 August 2014.
Europcar, Hertz and Avis entered into negotiations with the Commission and offered compromises that the Commission decided in October 2014 were satisfactory. The companies agreed that they would not automatically re-direct customers to a different national website on the basis of their computer IP address and that consumers would be able to start and complete an online booking on any national website of the rental company.
Why this matters:
Prices for rental cars can still be different in different countries, but consumers must no longer be charged different prices based on their country of residence. Any price differences must be “objectively justified”, according to the EU Commission.