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Unavoidable hidden charges for online consumers, or ‘drip pricing’, are to be banned under new legislation that forces businesses to be upfront with their customers.
Following a consultation on consumer transparency, the Department for Commerce and Trade (DBT) said false reviews would also be added to the list of prohibited commercial practices, and businesses would have to provide clearer labeling of prices on supermarket shelves. Stated.
The measure will be considered in Parliament as part of the Digital Markets, Competition and Consumers Bill.
Drip pricing occurs when consumers are shown the initial price of a product or service and then discover additional charges during the checkout process.
According to DBT, research shows it is widely adopted and used by 54% of entertainment providers, 56% of hospitality industries, and 72% of transport and communications sectors.
We strive to ensure that the information provided to consumers is clear and not misleading in any way.
Graham Wynne, British Retail Consortium
It added that unavoidable fees cost consumers £2.2 billion each year.
Under the new rules, mandatory fees, such as movie or train ticket booking fees, must be included at the maximum price or at the beginning of the shopping process.
Optional airline fees such as seat and baggage upgrades are not subject to the measure.
Kevin Hollinrake, Minister for Enterprise, Markets and Small Business, said: “From supermarket shelves to digital baskets, modern shopping offers customers more choice than ever before. But with it comes confusion, fraud and The risk of entrapment increases and can easily cause more damage to the population than planned.
“Today’s announcement demonstrates the clear steps we are taking as a government to ensure customers can easily compare their purchases, avoid being fooled by fake reviews and avoid being burdened with hidden fees.”
DBT said it found that reviews were used by 90% of consumers and contributed to £224bn of spend in the online retail market in 2022.
The Competition and Markets Authority (CMA) has contributed new guidance to tackle fake reviews that will hold website hosts accountable for the reviews on their pages.
Meanwhile, the Price Display Order (PMO), which requires traders to display the final sales price and, where appropriate, the final unit price (e.g. price per kilogram), will also be amended.
DBT believes that the proposed changes will ensure that pricing is applied consistently, including promotions and special offers, so that consumers can easily compare products and identify which items offer the best value. He said that it will become more common.
These will be published in the spring.
Graham Wynne, assistant director of the British Retail Consortium, said: We strive to ensure that the information provided to consumers is clear and not misled in any way. ”
A CMA spokesperson said: “It’s positive that the Government is bringing forward reforms to tackle behavior that misleads shoppers or makes them pay. “This includes accepting the CMA’s recommendations on food pricing.”
“Stronger laws and tools, including giving the CMA powers to fine businesses that breach consumer law under the DMCC Bill, will strengthen the work we are already doing to protect consumers. You will.”
