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Lastminute lays into railways over unfair competition
French fight it out

By Philippe Astor

Published: Thursday 27 May 2004

The French arm of online travel agent lastminute.com has accused France's national railway company, the SNCF, of stepping outside its public service remit by selling travel and flight offers from American partner Expedia on its webpage. The company is so riled by the move it's taking the SNCF to court on unfair competition charges.

Lastminute.com's French operation is accusing the SNCF of abusing its dominant position with its travel site voyages-SNCF.com and distorting competition in the market by "mixing public service and capitalist practices".

The company believes that by directing surfers who have come to buy tickets on the train site to commercial deals on organised trips and flights by its partner Expedia – the US online travel agent that holds 49.9 per cent of its site – the SNCF is helping a private firm to profit unduly from the clout of a public service.

The DG of Lastminute France, Pierre Paperon, will register the unfair competition complaint with France's competition council in the next two weeks.

Voyages-SNCF declined to comment.

Paperon is accusing Voyages-SNCF.com of not sticking to its original mission statement of providing a public service and selling train tickets.

"The growth of the SNCF site has been around 90 per cent while the members of ACSEL (France's ecommerce association) have managed 60 per cent and travel agents' sites 40 per cent, which got our attention. And we realised that an enormous email database was being compiled in an abnormal way," he said.

In fact, from moment their first ticket purchase was validate, the Voyages-SNCF users were automatically subscribed to its newsletter, "which is nothing to do with trains. It's just about trips and flights", the CEO said.

He said he decided to act "before it was too late, because Voyages-SNCF.com is weighing down on the sector more and more heavily and is threatening both other online companies and traditional travel agents". Lastminute.fr hopes to clearly differentiate the sale of train tickets and the other commercial activities of the site that don't come within the remit of the SNCF's public service mission.

The French arm of Lastminute isn't doing too badly itself. Its turnover should be between €210m and €230m in the 2003/2004 financial year, which ends 30 September, compared to €170m the year before – but the DG believes that in this case, prevention is better than cure.

Philippe Astor writes for ZDNet France