Ticket resale platform StubHub UK is set to refund more than 50,000 customers and pay a substantial fine of £900,000, following an investigation by the Competition and Markets Authority (CMA). The regulator found that the company failed to display the full, total price of tickets upfront, instead adding mandatory charges such as delivery and service fees only at the final checkout stage.
Each affected customer is anticipated to receive approximately £10 per transaction as part of the refund process. The CMA confirmed that StubHub UK will directly contact these customers regarding their compensation. StubHub International attributed the hidden fees to an "isolated platform error," stating that its UK platform is designed to show all fees upfront and that the issue has since been identified and corrected.
The enforcement action against StubHub UK forms part of a wider CMA review into online pricing practices, specifically targeting 'drip pricing' – a method where additional, unavoidable costs are introduced later in the purchasing journey, making an initial price appear cheaper than the actual total. This practice was outlawed in the UK last year under new consumer protection legislation.
Emma Cochrane, Executive Director of Consumer Protection at the CMA, emphasised the illegality of hidden fees, stating that it is unfair to entice customers with seemingly good deals only for the true cost to emerge at checkout due to unavoidable extra charges. The CMA's investigation found that between April and December last year, some customers purchasing tickets for events via StubHub UK encountered these undisclosed mandatory costs.
StubHub UK admitted to breaching consumer law, which resulted in a 40% reduction of its financial penalty. The company has also confirmed that it has taken steps to rectify the conduct. This move by the CMA comes after similar action was taken against the owner of AA and BSM driving schools in March, which were ordered to refund over 80,000 learners for not disclosing the total price of lessons upfront.
Under the new Digital Markets, Competition and Consumers Act, the CMA now possesses enhanced powers to directly address anti-competitive behaviour and consumer law breaches without needing to go through the courts. These powers allow the regulator to order compensation for affected customers and impose fines of up to 10% of a company's global turnover, underscoring a stricter regulatory environment for businesses operating online.