Holiday Inn in Moscow

Moscow hotels are in the center of a scandal before the Eurovision

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Hotels in Moscow on the threshold of the final of the Eurovision contest are preparing to host an entire army of music fans. Due to the expected increase in demand for hotels in Moscow the Federal Antimonopoly Service of Russia has also tightened supervision over the activities of the hotels. As a result, FAS has indicated the hotels that have raised the prices for their rooms in the last few months. FAS staff believe that higher prices for hotel rooms in Moscow at the eve of «Eurovision» is a violation of Russian legislation.

According to the Russian service of BBC, in association with the aim of raising the prices of hotels in Moscow Antimonopoly Service suspects 5 hotels: «Budapest», «President-Hotel», «Peter I», and two hotels under the brand name of the Holiday Inn. If the hotels will be proven guilty they could face a fine of up to 15% of their annual revenues.

At the same time, some analysts believe that such a conspiracy to raise prices wasn’t planned and that the rising cost of rooms is a regular seasonal phenomenon. According to the manager of one of the major investment companies of the hotel business, such a large event like Eurovision, of course, will be in sight of hotels that want to have the maximum benefit from the tourist inflow.

Nevertheless, FAS do not believe that the Moscow's hotels acted under the law. Moreover, the service sent out requests to 50 other hotels in Moscow, some of which may also be among the suspects in the price collusion.

The consideration of the case FAS of Russia has scheduled for 14 May 2009. It is unknown whether the process could be completed by the beginning of Eurovision, which starts in Moscow on May 17. One way or another, it is believed by experts that it would be very difficult to prove the guilt of hotels that raised the prices, because the hotels have the right to raise the cost of rooms during the season, which is in a full swing.

Date: 06/05/2009