Drip pricing: what the CMA’s latest enforcement action means for your business

The Competition and Markets Authority (CMA) has opened investigations into Trainline, Virgin Atlantic and RED Driving School over concerns that mandatory fees were added during the checkout process rather than being included in headline prices — a practice known as drip pricing.

If your business sells goods or services to consumers, this matters to you. The CMA’s decision to pursue well-known consumer brands signals a step change in how pricing transparency is being policed. Mid-sized businesses that rely on online sales or booking platforms should treat this as a prompt to review their own practices now rather than wait for a regulator to come knocking.

This isn’t a problem confined to airlines and ticketing platforms. Any business that presents a price to a consumer and then adds compulsory charges later in the purchase journey could be at risk.

What is drip pricing and why does it matter?

Drip pricing occurs when a business advertises a headline price but then incrementally adds unavoidable fees — such as booking charges, service fees or administrative costs — as the customer progresses through checkout. The result is that the final price is materially higher than the one that attracted the customer in the first place.

Under the Consumer Protection from Unfair Trading Regulations 2008 and the Consumer Rights Act 2015, this can amount to a misleading commercial practice. The Digital Markets, Competition and Consumers Act 2024 (DMCCA) has significantly strengthened the CMA’s hand, granting it direct enforcement powers to impose penalties of up to 10% of global turnover for consumer law breaches without needing to go through the courts.

What this means for your business

The commercial risks are real and immediate:

• Enforcement action: the CMA can now investigate and fine businesses directly. The reputational and financial consequences of being named in an investigation can be substantial, regardless of the outcome
• Customer trust: consumers are increasingly alert to hidden charges. Drip pricing erodes confidence and drives complaints, chargebacks and negative reviews
• Competitive disadvantage: businesses that price transparently will be better placed as regulatory expectations continue to tighten.

Practical steps to consider now include:

• Auditing your pricing and checkout processes end to end, with particular attention to any fees added after the initial price is displayed
• Ensuring all mandatory charges are included in the headline price shown to consumers
• Training commercial and marketing teams on regulatory expectations around pricing transparency
• Reviewing terms and conditions for clarity and fairness.

Our commercial team regularly advises consumer-facing businesses on pricing transparency and consumer protection requirements. The CMA’s latest investigations serve as a reminder of the importance of reviewing pricing practices to ensure they meet evolving regulatory expectations.