Investigations have been opened into eight companies, including ticket resellers and driving schools, by the UK’s competition regulator as part of a review of online pricing practices.
The cases are the first launched by the Competition and Markets Authority (CMA) under new consumer protection powers, and are looking at actions such as mandatory additional charges, time limited sales and automatic opt-ins.
The companies being investigated are StubHub, Viagogo, AA Driving School, BSM Driving School, Gold’s Gym, Wayfair, Appliances Direct and Marks Electrical.
The CMA is also writing to 100 businesses to outline its concern about their use of additional fees and sales tactics.
CMA chief executive Sarah Cardell said: “At a time when household budgets are under constant pressure and we’re all hunting for the best deal possible, it’s crucial that people are able to shop online with confidence, knowing that the price they see is the price they’ll pay, and any sales are genuine.”
The announcement comes after a major review which has been ongoing since April, looking at more than 400 businesses across the economy, to review whether rules on price transparency are being met.
Under the Digital Markets, Competition and Consumers Act introduced last year, the CMA has powers to tackle anti-competitive behaviour.
It can now decide if consumer laws have been broken – rather than having to go through the courts.
It can order businesses to pay compensation to affected customers, and fine companies up to 10% of global turnover.
The CMA has said it is looking into practices including pressure selling, drip pricing, and misleading countdown clocks as part of its investigations.
Drip pricing happens when shoppers are shown an initial price for an item or service on a website, only to find additional fees are revealed later in the checkout process.
The 100 companies the CMA has contacted operate in a range of sectors, including holidays (including package travel), homeware retailers, rail travel, parking and airport parking, bus and coach travel, luggage storage providers, cinemas, live event tickets, food and drink delivery companies, letter and parcel delivery, gyms and fitness, fashion, and online vouchers.
These companies have been put “on notice” and are required to ensure they are in line with pricing guidance and guidelines on unfair commercial practice in order to avoid enforcement action.
Of the eight companies, the CMA stated that it had “reached no conclusions about whether the law has been broken in any of these investigations”.
AA Driving School and BSM Driving School are brands operated as part of Automobile Association Developments Limited.
A spokesperson for both companies said: “We are comfortable that the £3 booking fee for lessons is already transparent and in line with the CMA’s rules and are more than happy to additionally notify customers earlier in the journey as well, which we have already done.”
