StubHub UK fined £889,200 for drip pricing and ordered to refund customers
Quick Look
- StubHub UK has been fined £889,200 and ordered to refund over 50,000 customers for "drip pricing".
- The UK's competition watchdog found the company failed to disclose full ticket costs upfront, adding mandatory fees at the final checkout stage.
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Why It Matters
StubHub UK was fined £889,200 and ordered to refund over 50,000 customers for failing to disclose the full cost of tickets upfront, a practice known as 'drip pricing'.
Online ticket reseller StubHub UK fined over drip pricing.
StubHub UK has been fined £889,200 and ordered to refund more than 50,000 customers after the UK’s competition watchdog found it had failed to clearly disclose the full cost of tickets upfront,The Guardian reported.
StubHub is a large online marketplace that allows fans to buy and sell tickets for live sports, concerts, theater, and other entertainment events worldwide.
The Competition and Markets Authority (CMA) said StubHub added mandatory charges, including service and delivery fees, at the final stage of the checkout process rather than including them in the initial ticket price displayed to customers.
The practice, known as "drip pricing", breaches consumer protection law.
As part of the enforcement action, StubHub must refund more than £590,000 to 51,350 customers who were affected by the hidden charges.
According to the CMA, the average refund will be around £10.33 per transaction.
The watchdog's investigation found the practice occurred between April 6 and December 7 last year, when customers purchasing tickets for concerts and sporting events were shown a lower price at the start of the booking process before unavoidable fees were added at checkout.
Emma Cochrane, the CMA's Executive Director for Consumer Protection, said businesses must be transparent about costs from the outset and warned that companies risk enforcement action if they fail to do so.
The regulator said the £889,200 penalty included a 40 per cent reduction because StubHub admitted it had breached consumer law and agreed to settle the case.
The action marks the second financial penalty imposed by the CMA under new consumer enforcement powers that allow the regulator to take direct action against businesses without first going through the courts.
The authority said it has already secured more than £1.95 million in customer refunds and imposed fines exceeding £5.7 million since the new powers came into effect.
The CMA launched an investigation last year into the ticket-selling practices of eight companies, including Viagogo UK.
Open Questions
- Will other ticket resellers face similar action?
- What are the long-term implications for StubHub's business model?
