StubHub Fined £900,000 and Ordered to Refund UK Customers for Hidden Fees
The Competition and Markets Authority found the ticket reseller illegally added mandatory charges at the checkout stage, a practice known as drip pricing.
StubHub UK has been ordered by the Competition and Markets Authority (CMA) to refund over 50,000 customers and pay a £900,000 fine for failing to clearly display total prices upfront. Customers are expected to receive an average of £10 per transaction.
The CMA's investigation found that between April 6 and December 7 of the previous year, StubHub UK added mandatory costs, such as delivery and service fees, only at the final checkout stage. These fees were unavoidable, and their late introduction led to customers paying more than initially presented.
Drip pricing, the practice of introducing charges later in the buying process, was banned last year. The CMA stated that this practice is illegal and unfair, misleading customers into believing a product is cheaper than it actually is.
StubHub International, which operates the UK platform, attributed the issue to an "isolated platform error" that caused some charges to appear at checkout. The company stated that its UK platform is designed to display all fees upfront and that the issue has been promptly identified and corrected. Affected customers will automatically receive refunds.
StubHub UK admitted to breaking the law and received a 40% reduction on its financial penalty. The company has also taken steps to cease the practice.
Emma Cochrane, executive director of consumer protection at the CMA, emphasized the illegality of hidden fees and the importance of transparency in pricing. "Our message to businesses is simple: be transparent on costs or risk CMA action," she said.
This action is part of a broader review by the CMA into online pricing practices. Last year, the CMA also launched investigations into other companies, including Viagogo, AA Driving School, and Wayfair, examining practices such as pressure selling and misleading countdown clocks.
Under the Digital Markets, Competition and Consumers Act, the CMA has enhanced powers to address anti-competitive behavior. It can now order businesses to compensate affected customers and impose fines of up to 10% of global turnover without needing to go through the courts.
The CMA also noted that its investigation into Viagogo regarding its fee presentation is ongoing, with an update expected later this summer. In March, the CMA ordered the owner of AA and BSM driving schools to issue refunds to over 80,000 learners for similar failures in upfront price disclosure.