The Competition and Markets Authority has opened drip pricing investigations into Trainline, Virgin Atlantic and RED Driving School, saying that “the first price customers see should be the price they pay”, under powers that let it fine a business that breaks consumer law up to 10 per cent of its global turnover and order it to compensate customers.
The regulator announced the investigations on 19 August. It described the cases as being at an early stage and said it had not yet reached any conclusion on whether the three companies had broken the law. The Trainline case, formally opened on 18 August according to the CMA’s case record, concerns whether all mandatory fees were shown to travellers buying train and coach tickets in advance on its app and website. The CMA said it had observed additional fees of between 59p and £2.79 on train bookings and a £1.50 booking fee on coach journeys. Information gathering is scheduled to run until January 2027.
The Virgin Atlantic investigation concerns mandatory resort fees and local taxes on package holidays, which the CMA said can add hundreds of pounds to the cost of a holiday. At RED Driving School, the regulator is looking at how a mandatory booking fee and a “digital” fee of more than £7 per booking were displayed to learners booking lessons.
What the regulator expects from businesses
The CMA is using powers it gained under the Digital Markets, Competition and Consumers Act. All three firms were sent advisory letters during the CMA’s first consumer protection drive under those powers. The letters “put the businesses on notice and remind them of their obligations under consumer law”, the regulator said.
The CMA said its Clear Pricing campaign, launched in February, gives businesses a three-step checklist: “Show the total price up front”, “Include all mandatory charges” and “If you can’t give a total yet, is it clear how customers can work it out?” The regulator said driving schools AA and BSM and the ticketing site StubHub UK “have already received fines and will refund customers after being investigated over their use of drip pricing”.
Emma Cochrane, the CMA’s executive director for consumer protection, said: “At a time when many households are watching every pound they spend, it is important that people are not surprised by extra fees when booking train and coach tickets, holidays or driving lessons. Clear pricing helps people compare offers confidently and choose the option that works best for them.”
She added: “Unexpected mandatory charges make this much harder, which is why the CMA initially put these firms on notice over concerns about their pricing practices and is now opening formal investigations. The first price customers see should be the price they pay.”
A Trainline spokesman said: “We’ve proactively engaged with the CMA over several months and we are taking proactive steps to enhance how certain fees are presented to our customers. We will continue engaging with the CMA to address their questions.”
Trainline, the only one of the three with a stock market listing, saw its shares fall 16 per cent, or 38p, to 205p in early trading on 19 August.
A Virgin Atlantic Holidays spokesman said: “Mandatory fees are indicated at multiple stages throughout the booking journey. We are reviewing the points raised by the CMA carefully and will co-operate fully with its investigation.”
Sue Davies, who heads consumer rights policy at Which?, said the regulator should act if breaches were established. “The CMA shouldn’t hesitate to use its new consumer enforcement powers to fine any firms that have broken the rules, especially after each firm has already received a warning advisory letter,” she said.
“Following comments made by the prime minister last week that unfair pricing practices have no place in our economy, this move sends a clear message to other businesses to follow the rules.”
