Travel agency told me my hotel is overbooked, what are my rights?

Question

Since this question will probably involve some laws, I will state that I am German and I was booking via an online site which is mediating for travel agencies.

I booked a hotel on May 15 for a one week stay in Italy at Lake Garda (June 19 to 26). On May 25th I was told by the travel agency that the hotel was overbooked and offered me a new, in my opinion inadequate, one to stay in. I told them that I know that region and that the other hotel is not in question for us. I supplied them with a few alternatives, one of them being in the same town, the others in different towns (probably 15 km away).

Today, on May 29, I got a new offer from the agency for one of the hotels that I proposed, but to a higher price. It does have an additional star compared to the originally booked hotel, but it is not in the town I wanted and the town does not even have a beach. They offered me to pay 773 € for the alternative that I suggested when I explicitly said that my budget will not exceed the 653 € I initially paid.

They also offered me a hotel for no additional cost. It also has an additional star and does cost more, but it is on the complete other side of the lake! I specifically looked for a hotel on the east side and driving from Limone takes at least an hour to get to where I want to go on my holiday.

I do want to get a solution from the agency, since it is way too late now to find anything else.

What are my rights regarding compensation if I do accept any of their offers, even if I take the more expensive hotel at no additional cost? Can I somehow demand they let me stay in the (alternative and more expensive) hotel I proposed for no additional cost?

Edit November '19: I wrote a formal complaint to the travel agency stating that they could not offer me an adequate alternative booking. In a similar case, the German Federal Court ruled a compensation of up to 50% of the original booking cost in favour of the travellers. The agency took over 2 months to simply reply that I already cancelled the trip and that's it, totally disregarding my claim. I filed a complaint and they will take another look at it, probably taking another two months.

Answer 1

Unfortunately, there isn't much you can do, and this type of situation happens often with disreputable travel sites, as well as some better known ones at times. They get "great deals" because they help in filling up the hotel rooms, but sometimes their systems are not accurate, and it causes huge problems. Ive heard of similar situations with car rental companies. Always do your diligence when finding out about the company. The saying goes you get what you pay for, so keep that in mind also. Im sorry you had to deal with this, but there isn't much you can do besides leave a detailed review for the next patron.