Eight firms investigated over online pricing as CMA exercises new powers

Eight companies are under formal investigation by the UK Competition and Markets Authority (CMA) over concerns over online pricing tactics, marking the first major enforcement action taken by the regulator under its enhanced consumer protection powers.

The companies – StubHub, Viagogo, AA Driving School, BSM Driving School, Gold’s Gym, Wayfair, Appliances Direct and Marks Electrical – are being examined as part of a wide-ranging review into how businesses display and regulate prices online. The CMA is also writing to a further 100 companies warning them about potential breaches relating to surcharges, pressure selling and misleading sales tactics.

Sarah Cardell, chief executive of the CMA, said consumers should be able to trust that the prices they see online are real and complete.
“At a time when household budgets are under constant pressure and we are all looking for the best possible deal, it is important that people can shop online with confidence, knowing that the price they see is the price they will pay,” she said. “Any sales have to be real.”

The investigations follow a major review launched in April in which the CMA assessed price transparency practices at more than 400 companies across the economy. Regulators are particularly concerned about “drip pricing,” where customers are offered a low initial price but only face additional fees during checkout, and about the use of countdown clocks and other pressure-based sales tactics.

These cases are the first to be opened under the Digital Markets, Competition and Consumer Act, introduced last year, which gives the CMA unprecedented enforcement powers. The watchdog can now determine on its own whether consumer law has been breached – without taking cases to court – and can order companies to pay compensation or impose fines of up to 10% of global turnover.

The CMA has not yet confirmed the timeline for the investigations, but said further enforcement action is likely to be taken as the regulator continues its sector-wide review. The aforementioned companies have the right to respond, and the Capital Markets Authority has not yet determined whether any violations have occurred.