Trainline, Virgin Atlantic and RED Driving School are being investigated by the Competition and Markets Authority over concerns that customers were not shown the total price upfront when buying train and coach tickets, package holidays and driving lessons.
The CMA announced the investigations on Wednesday and said they were at an early stage, with no conclusions yet reached on whether any of the three companies had broken consumer law. If breaches are found, the regulator said it could order the firms to pay compensation to affected customers and fine them up to 10 per cent of their global turnover.
The Trainline investigation focuses on whether all mandatory fees were displayed to travellers buying train and coach tickets in advance on the platform’s app and website. The CMA said it observed transactions with additional fees ranging from 59p to £2.79 on train bookings, and a £1.50 booking fee on coach journeys. The case against the FTSE 250 company was formally opened on 18 August, according to the regulator’s case record.
Shares in Trainline, the only listed company of the three, fell 16 per cent, or 38p, to 205p in early trading on Wednesday.
The investigation into Virgin Atlantic concerns mandatory resort fees and local taxes charged on package holidays, while RED Driving School is being examined over how a mandatory booking fee and a so-called digital fee — which the CMA put at more than £7 per booking — were displayed to customers booking driving lessons.
The investigations are being brought under the Digital Markets, Competition and Consumers Act, which strengthened the CMA’s consumer protection powers. The regulator said each of the three businesses had previously received an advisory letter as part of an earlier round of enforcement action.
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.”
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.”
Emma Cochrane, executive director for consumer protection at the CMA, said: “Clear pricing helps people compare offers confidently and choose the option that works best for them … At a time when many households are watching every pound they spend, it is important that people are not surprised by extra fees.”
She added: “The first price customers see should be the price they pay.”
Sue Davies, head of consumer rights policy at Which?, said the regulator should not hesitate to 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.”
