UK Competition Watchdog Targets Online Pricing Practices
In This Article
HIGHLIGHTS
- The UK's Competition and Markets Authority (CMA) is investigating eight companies, including StubHub and Viagogo, over online pricing practices.
- The investigations focus on issues like drip pricing and pressure selling, using new consumer protection powers.
- The CMA has contacted 100 businesses across various sectors to address concerns about additional fees and sales tactics.
- The CMA can now impose fines up to 10% of global turnover and order compensation without court proceedings.
- Updates on these investigations are expected by March next year.
The UK's Competition and Markets Authority (CMA) has launched investigations into eight companies, including ticket resellers StubHub and Viagogo, as part of a crackdown on misleading online pricing practices. This marks the first use of the CMA's enhanced consumer protection powers, which aim to address issues such as drip pricing and pressure selling.
Investigations and Concerns
The CMA's investigations target companies across various sectors, including AA Driving School, BSM Driving School, Gold's Gym, Wayfair, Appliances Direct, and Marks Electrical. These firms are scrutinized for practices that may mislead consumers, such as hidden fees and misleading countdown timers. The CMA's chief executive, Sarah Cardell, emphasized the importance of price transparency, stating, "It's crucial that people are able to shop online with confidence, knowing that the price they see is the price they'll pay."
Broader Industry Impact
Beyond the eight companies under investigation, the CMA has reached out to 100 businesses across 14 sectors, urging them to review their pricing practices. These sectors range from travel and homeware to food delivery and fashion. The CMA's actions follow a comprehensive review of over 400 businesses since April, assessing compliance with price transparency rules.
New Powers and Potential Penalties
Under the Digital Markets, Competition and Consumers Act, the CMA can now determine if consumer laws have been violated without court intervention. This allows the regulator to impose fines of up to 10% of a company's global turnover and mandate compensation for affected consumers. Rocio Concha, director of policy and advocacy at consumer group Which?, praised the CMA's proactive stance, stating, "It’s encouraging that the regulator is taking this action."
WHAT THIS MIGHT MEAN
The CMA's investigations could lead to significant changes in how companies present prices online, potentially setting a precedent for stricter enforcement of consumer protection laws. If the CMA finds violations, affected companies may face substantial fines and be required to compensate consumers, which could deter similar practices industry-wide. As updates are expected by March, businesses will likely reassess their pricing strategies to align with the CMA's guidelines, potentially leading to more transparent and consumer-friendly practices in the UK market.
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UK Competition Watchdog Targets Online Pricing Practices
In This Article
Daniel Rivera| Published HIGHLIGHTS
- The UK's Competition and Markets Authority (CMA) is investigating eight companies, including StubHub and Viagogo, over online pricing practices.
- The investigations focus on issues like drip pricing and pressure selling, using new consumer protection powers.
- The CMA has contacted 100 businesses across various sectors to address concerns about additional fees and sales tactics.
- The CMA can now impose fines up to 10% of global turnover and order compensation without court proceedings.
- Updates on these investigations are expected by March next year.
The UK's Competition and Markets Authority (CMA) has launched investigations into eight companies, including ticket resellers StubHub and Viagogo, as part of a crackdown on misleading online pricing practices. This marks the first use of the CMA's enhanced consumer protection powers, which aim to address issues such as drip pricing and pressure selling.
Investigations and Concerns
The CMA's investigations target companies across various sectors, including AA Driving School, BSM Driving School, Gold's Gym, Wayfair, Appliances Direct, and Marks Electrical. These firms are scrutinized for practices that may mislead consumers, such as hidden fees and misleading countdown timers. The CMA's chief executive, Sarah Cardell, emphasized the importance of price transparency, stating, "It's crucial that people are able to shop online with confidence, knowing that the price they see is the price they'll pay."
Broader Industry Impact
Beyond the eight companies under investigation, the CMA has reached out to 100 businesses across 14 sectors, urging them to review their pricing practices. These sectors range from travel and homeware to food delivery and fashion. The CMA's actions follow a comprehensive review of over 400 businesses since April, assessing compliance with price transparency rules.
New Powers and Potential Penalties
Under the Digital Markets, Competition and Consumers Act, the CMA can now determine if consumer laws have been violated without court intervention. This allows the regulator to impose fines of up to 10% of a company's global turnover and mandate compensation for affected consumers. Rocio Concha, director of policy and advocacy at consumer group Which?, praised the CMA's proactive stance, stating, "It’s encouraging that the regulator is taking this action."
WHAT THIS MIGHT MEAN
The CMA's investigations could lead to significant changes in how companies present prices online, potentially setting a precedent for stricter enforcement of consumer protection laws. If the CMA finds violations, affected companies may face substantial fines and be required to compensate consumers, which could deter similar practices industry-wide. As updates are expected by March, businesses will likely reassess their pricing strategies to align with the CMA's guidelines, potentially leading to more transparent and consumer-friendly practices in the UK market.
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