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Commerce Commission clears Wotif, Expedia merger

The Commerce Commission has cleared a merger of online travel agencies Expedia and Wotif.com Holdings after assessing concerns the tie-up would lead to increased commission rates.

The antitrust regulator focused on whether the merger would make it easier for Expedia and Priceline to raise prices or reduce service quality as the only two major players in the market, it said in a statement yesterday. The commission was satisfied the merger would be unlikely to substantially lessen competition in the market, with metasearch sites such as TripAdvisor and Google Hotel Finder playing a more important role in online accommodation bookings.

"Market participants raised concerns that Wotif was an important source of bookings for some accommodation providers and that its removal from the New Zealand market may result in them paying higher commission rates to the remaining OTAs (online travel agents)," chairman Mark Berry said. "We are satisfied that the online accommodation booking industry is dynamic."

The New Zealand antitrust regulator was one of the last regulatory hurdles for the merger, which now only needs sign-off from the Supreme Court of Queensland, which will hold a hearing today. ASX-listed Wotif anticipates the merger to be implemented on Nov. 14, when its shares are transferred to Expedia.