Ireland’s consumer watchdog has launched an investigation into a restaurant industry push for the introduction of non-refundable booking deposits to combat no-shows.
It comes after the Restaurants Association of Ireland (RAI) wrote to its members to recommend the introduction of new booking policies – and suggesting a specific amount that could be charged as a deposit.
In a statement, the Competition and Consumer Protection Commission (CCPC) said it has no issue with individual restaurants adopting the policy – but warned that the industry-wide campaign may be in breach of competition law.
It said it has been in talks with the RAI on the issue for several months and took the decision to launch the investigation after the lobby group “failed to address” its concerns.
Industry push
“Under competition law, a trade association must not attempt to co-ordinate the conduct of its members, for example, by advising, recommending or suggesting to its members the terms and conditions under which a service should be provided, or the price that should be charged,” it said.
“The CCPC’s role is to ensure that businesses have the freedom to set their own terms, and we engaged with the RAI to make them aware of their obligations under competition law.
“The nature of this engagement was to bring about compliance; however, the association has failed, to date, to address these concerns.”
For its part the RAI has insisted it has done nothing wrong.
No-shows
The association issued its call for non-refundable deposits after restaurant owners warned that the increasing number of people failing to show up for bookings is costing them money.
Dublin-based restaurateur Mary Frisby said no-shows can have a big impact on profits – especially over the holidays.
“Most restaurants would be depending on the money they take in during December to pay the bills during January when it is completely dead,” she said. “The wages and the bills.”
“Nobody can afford empty tables so, with that in mind, it is helpful to have a procedure in place.
“No-shows just don’t work for anybody and deposits are a way of ensuring that tables turn up.”
The CCPC investigation is ongoing.
