Ticket Reseller Faces Penalties for Lack of Price Transparency
Ticket resale platform StubHub UK has been instructed to reimburse more than 50,000 customers and incur a £900,000 penalty. This directive comes after an investigation by the Competition and Markets Authority (CMA) revealed that the company did not present the total ticket price to buyers upfront.
Each affected customer is anticipated to receive an average refund of £10 per transaction. The CMA's inquiry focused on StubHub UK's failure to include all mandatory charges, such as delivery and service fees, until the final checkout stage, creating a misleading initial price.
"Hitting customers with hidden fees is illegal. It's not fair to draw people in with what looks like a good deal, only for them to find the real price is higher when they get to the checkout due to extra charges that can't be avoided," stated Emma Cochrane, executive director of consumer protection at the CMA.
The regulator confirmed that StubHub UK would contact the impacted ticket purchasers regarding their refunds. This enforcement action against StubHub is part of a broader CMA review into online pricing strategies, specifically targeting 'drip pricing,' a practice outlawed last year. Drip pricing involves the introduction of fees and charges late in the purchasing process, giving customers the impression that a product is cheaper than its actual cost.
The CMA's findings indicated that between April 6 and December 7 of the previous year, customers purchasing tickets for concerts and sporting events via StubHub UK were subjected to unavoidable mandatory costs that were only disclosed at the final checkout. StubHub UK has acknowledged its breach of the law, which resulted in a 40% reduction in its financial penalty. The company has also committed to implementing measures to prevent such conduct in the future.
Cochrane emphasized the significance of this action, stating, "Going to a live gig or sports game is an event many people save for – and our action today means thousands of fans will get back money taken unfairly through hidden fees." She concluded with a clear warning to businesses: "Our message to businesses is simple: be transparent on costs or risk CMA action."
Source: Ticket reseller StubHub ordered to refund customers over hidden fees