Nancy Shukri: Regulatory mechanism being studied for online travel agents

KUALA LUMPUR: A study on the need for a regulatory mechanism for online travel agents (OTA) is being carried out to ensure better quality of service for consumers, the Dewan Rakyat was told.

Tourism, Arts and Culture Minister Datuk Seri Nancy Shukri said, however, any decision will take into account the views of all parties, from travel booking platforms to accommodation providers.

"We are studying the need to introduce a new regulation mechanism in this sector of the tourism industry.

"This regulation will not only ensure accommodations are of good quality, it can also encourage cooperation between the Tourism, Arts and Culture Ministry (Motac) and stakeholders to continue improving the industry.

"This study will surely look into the issue of commissions charged by OTA companies," she said in reply to Abdul Latiff Abdul Rahman (PAS-Kuala Krai) who asked if Motac was looking to introduce a ceiling commission rate on accommodations provided by OTA.

Currently, the rate is between 12% and 18% of each room’s booking price.

She also pointed out the need to be objective in evaluating such matters because many factors had to be considered in deciding on a policy.

This included market forces, the development of digitalisation, and creating a business environment conducive to companies to continue operating in Malaysia, she said.

She added that such matters do not fall under Motac's jurisdiction alone, but also involve other ministries such as Housing and Local Government, as well as Domestic Trade and Consumer Affairs.

Asked about Motac’s intention to fully regulate accommodations listed under private company Airbnb, Nancy said the multi-ministry effort was still fine-tuning the processes at this stage and it was still within the purview of the Housing and Local Government Ministry.

“At this point, Motac has yet to register Airbnb (as)... registered premises for accommodation,” she said.