What’s Actually Happening: CMA’s Crackdown
- New Legal Powers Under the Digital Markets, Competition & Consumers Act (DMCCA)
- As of April 6, 2025, the CMA has stronger consumer enforcement powers under the DMCCA. (GOV.UK)
- These powers let the CMA act directly (without needing to go through lengthy court processes) to enforce consumer-protection rules. (BCLP)
- Fines for breaking the rules can be up to 10% of a company’s global turnover. (GOV.UK)
- What Practices Are Being Targeted
The CMA is focusing on three specific kinds of misleading online pricing:- Drip pricing: When companies advertise a low headline price, but mandatory fees (booking fees, admin costs, etc.) are only revealed later in the purchase process. (GOV.UK)
- Misleading countdown timers (“urgency” or “scarcity” claims): Using fake or exaggerated “sale ending soon” countdowns to pressure customers into buying. (GOV.UK)
- Automatic opt-ins for optional extras: For example, pre‑ticked boxes for insurance, installations, or added services that consumers may not realize they’re paying for. (wiggin.co.uk)
- Initial Enforcement Actions
- The CMA has launched investigations into 8 companies, across different sectors. (GOV.UK)
- Some of the targeted companies: StubHub and viagogo (ticketing), Gold’s Gym, Wayfair, Appliances Direct, Marks Electrical, AA Driving School, and BSM Driving School. (GOV.UK)
- The CMA is also sending advisory letters to 100 businesses in 14 different sectors, flagging concerns about their pricing methods. (GOV.UK)
- Guidance for Businesses
- The CMA published new guidance on price transparency to help businesses understand what they’re allowed and not allowed to do under the law. (GOV.UK)
- In its “Treating Customers Fairly” guidance, the CMA warns that businesses must not hide mandatory costs and must avoid using misleading marketing tactics. (GOV.UK)
Why the CMA Is Doing This
- Protect Consumers: With household budgets under pressure, the CMA says consumers deserve to see the real price up-front and not be misled by fake discounts or pressure tactics. (GOV.UK)
- Level Playing Field: By cracking down on deceptive pricing, the CMA wants to ensure that companies that are honest about fees can compete fairly. (GOV.UK)
- Regulatory Modernization: The new DMCCA powers give the CMA ability to act more nimbly and impose meaningful penalties on firms that misuse pricing tricks. (BCLP)
Key Risks & Potential Impacts
- For Consumers: If the CMA succeeds, shoppers should face fewer “hidden” costs, more trustworthy discounts, and less pressure to make quick buying decisions.
- For Businesses: Companies that rely on drip pricing or aggressive sales tactics may have to fundamentally change how they show prices online — or face fines and compensation orders.
- Compliance Costs: Many firms will need to audit their checkout flows, marketing language, and how “sales” are displayed.
- Reputation Risk: Investigations or enforcement could damage trust, especially for companies in sectors like ticketing or gyms where hidden fees are common.
- Long-Term Market Effects: This crackdown may push more companies toward transparent pricing models, which could benefit consumers but reduce flexibility for some business models.
Comments & Reactions
- CMA (Sarah Cardell, CEO):
“At a time when household budgets are under constant pressure … 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.” (GOV.UK)
- Legal / Compliance Experts (KPMG): They note that under the DMCCA, not only drip pricing is targeted — fake reviews are also prohibited, raising the bar for online retail compliance. (KPMG)
- Law Firms (Cleary Gottlieb): Explain that under the new regime, if mandatory fees cannot be calculated upfront, businesses must disclose how those fees will be calculated. (Cleary Gottlieb)
- Good question. Here are case‑style examples (based on real CMA investigations) + key comments that illustrate how the UK CMA’s crackdown on misleading online pricing is playing out — who they’re targeting, what the issues are, and expert / public reactions.
Case Studies & Scenarios
- Ticketing Platforms: StubHub & Viagogo
- The CMA is investigating StubHub and Viagogo over “mandatory additional charges” when consumers buy tickets — particularly whether these fees are properly included in the upfront price. (GOV.UK)
- These are classic “drip pricing” concerns: headline ticket prices may look good, but hidden or late-stage fees (service fees, booking fees) could dramatically increase the true cost. (The Guardian)
- If the CMA finds wrongdoing, these companies could face big fines (up to 10% of global turnover) and may be forced to compensate affected consumers. (GOV.UK)
- Fitness / Gym Memberships: Gold’s Gym
- Gold’s Gym is under investigation for how it advertises its membership. Specifically, the CMA is assessing whether a “joining fee” is hidden or disclosed only part-way through the sign-up process. (Wired-Gov)
- The risk: customers might sign up thinking a monthly rate is all they’ll pay, only to find a one-off upfront fee later — distorting their decision-making. (GOV.UK)
- Driving Schools: AA & BSM
- Both AA Driving School and BSM Driving School are being investigated over whether mandatory fees are clearly included in their advertised price. (GOV.UK)
- These investigations will examine whether the “total price you pay” is transparent from the start, or if there’s “drip pricing” during the booking or checkout process. (Wired-Gov)
- Retailers / Homeware: Wayfair, Marks Electrical, Appliances Direct
- Wayfair: The CMA is looking into whether its “time-limited sales” (e.g., flash sales) are genuine, or if the countdown / scarcity tactic is misleading. (GOV.UK)
- Marks Electrical: Under investigation for default “opt-in” of additional services or warranties — i.e., pre-ticked boxes that charge customers unless they explicitly opt-out. (Wired-Gov)
- Appliances Direct: The CMA is examining both “time-limited offers” and whether customers are being automatically opted in to extra services. (Wired-Gov)
- Advisory Letters to 100+ Firms Across 14 Sectors
- Beyond the 8 under formal investigation, the CMA is sending advisory letters to ~100 businesses in 14 different sectors (gyms, live events, homeware, driving schools, food delivery, etc.) highlighting concerns about hidden fees and “pressure selling” tactics. (GOV.UK)
- These letters don’t yet mean wrongdoing, but they serve as a strong warning: the CMA expects transparency and compliance with its new guidance on price presentation. (Wiggin LLP)
Key Comments & Reactions
- Sarah Cardell (CMA CEO):
“At a time when household budgets are under constant pressure … 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.” (GOV.UK)
- Wiggin LLP (Legal / Compliance Experts):
- They note this is the first enforcement wave under the CMA’s new digital‑consumer powers (via the DMCCA). (Wiggin LLP)
- They emphasize that businesses should now review their checkout flows, opt-in practices, and how they present “sale” pricing to avoid potential breaches. (Wiggin LLP)
- Music Industries Association (MIA):
- Warns its members (online musical instrument retailers) to pay attention to “delivery charges” and how they’re disclosed during purchase invitations. (Music Industries Association)
Risks & Implications (Based on These Cases)
- Consumer Trust Risk: If these investigations find violations, it could erode consumer trust in major platforms (ticketing, gyms, retail).
- Financial Risk for Businesses: Companies under investigation could face large fines (up to 10% of global turnover) and compensation orders. (GOV.UK)
- Operational / Compliance Burden: Many businesses will need to audit and possibly overhaul how they show prices, handle opt-ins, and run promotions.
- Market Impact: Clearer pricing rules could benefit “fair-dealing” businesses, but might reduce flexibility for firms that rely heavily on opt-ins, flash-sales, or hidden fees.
- Regulatory Precedent: This is the CMA’s first major set of enforcement actions under its new DMCCA powers — how these cases resolve could set the tone for future digital commerce regulation.
Bottom line: This isn’t just a symbolic move — the CMA is using its new powers seriously and has opened major investigations into prominent companies for potentially misleading pricing tactics. For consumers, it could mean more clarity and fairness; for businesses, it means a new era of transparency is mandatory.
- Ticketing Platforms: StubHub & Viagogo