Trivago is facing allegations from The Australian Competition and Consumer Commission (ACCC) over misleading advertising and impartial price comparisons.
The ACCC is alleging Trivago television ads suggest it is offering objective price comparisons, but the consumer group says advertisers are prioritised by the listing fee paid by the hotel. Prices are highlighted in such a way to look like the cheapest hotel, when in many cases they are not.
ACCC chair Rod Sims tells My Business consumers may form the incorrect impression of the best prices.
"Trivago based its rankings on the highest cost per click it would receive from its advertisers."
The consumer group also alleges price comparisons are fake and often pit a standard room against a luxury room, meaning consumers will most likely pay more than needed.
Trivago has responded to the allegations, saying it is "disappointed by the action of ACCC".
In April, Trivago stopped airing price comparison ads, after they had aired more than 400,000 times.