Honest prices: Great Britain obliges retailers to ensure price transparency
In future, price information in the UK must include all extra charges. This is stipulated by a new law. The fight against fake reviews is also being declared.
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A new consumer protection law has come into force in the UK that prohibits companies from charging hidden fees. At the same time, the Digital Markets, Competition and Consumer Act 2024 (DMCC) empowers the state to take stronger action against fake product reviews on the internet. The law is also aimed at combating unfair contract terms, false consumer information and aggressive sales practices.
Experts refer to "drip pricing" when retailers advertise low prices and only during the purchasing process do they realize that additional mandatory fees will be added to the purchase price. Customers usually only find out at the end of a multi-stage ordering process. One example is a broadband connection for which the advertised price conceals the fact that a one-off installation fee will be added. Until now, consumers had to look closely and read the small print to avoid falling into price traps.
Where cheating takes place
A study by the UK's Department of Trade and Industry, published in September 2023, found that 46% of the 525 online and app providers surveyed used hidden fees in the purchasing process. Transportation and communication service providers were the most likely to be found to be negative (72%). On average, prices were around six percent more expensive in the end due to mandatory extra fees.
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The products and services affected included event tickets, cinema tickets, gym memberships, food deliveries, flight tickets, parcel delivery and bus tickets. According to the surveys, consumers incurred additional costs of up to 4.1 billion euros.
Push against fake reviews
The aim is also to take stronger action against market distortions caused by fake reviews. Surveys have come to the conclusion that at least 10 percent of all product reviews on e-commerce platforms are probably fake. On the other hand, 90 percent of consumers factor reviews into their purchasing decisions. E-commerce providers should be held more accountable for preventing and deleting fake reviews.
In the first twelve months after the law comes into force, the British Competition and Markets Authority (CMA) wants to focus initially on serious infringements where the legal situation is clear. Otherwise, the initial period will be used primarily for dialog to help companies understand the new regulations, according to a paper.
(mki)
