Optional airline fees excluded from government clampdown on drip pricing

Optional fees such as airline seats and luggage upgrades for flights will not be included in a new government clampdown on so-called drip-pricing.

The exemption was disclosed as the Department for Business and Trade (DBT) unveiled plans to introduce new laws covering hidden fees, fake reviews and shop labelling.

Mandatory fees must be included in the headline price at the start of the shopping process, including booking fees for cinemas and train tickets under the proposals.

Government research suggests that drip pricing is widespread and occurs in more than half of providers in the entertainment (54%) and hospitality (56%) industries, and almost three quarters across the transport and communication (72%) sectors.

But the DBT said: “Optional fees such as airline seat and luggage upgrades for flights will not be included in these measures.”

No further explanation was given for airlines being excluded from the proposals, which follow a consultation into consumer transparency and as part of the Digital Markets, Competition and Consumer Bill.

However, the DBT will officially add fake reviews to a list of banned business practices, outlaw dripped fees “that are unavoidable for consumers” and ensure that businesses provide clearer labelling for prices on supermarket shelves.  

The business department said: “Sneaky hidden fees, or dripped prices that are unavoidable will be banned. 

“Drip pricing occurs when consumers are shown an initial price for a good or service while additional fees are revealed (or ‘dripped’) later in the checkout process.”

Consumer body Which? has been campaigning against drip-pricing across a range of business sectors. 

In a policy research paper issued in October, Which? said: “In some cases, dripped fees are for optional services that are applied depending on the choices that consumers make to suit their needs (such as extra luggage or additional legroom when selecting a flight). These practices need to be dealt with in different ways. 

“However, the overriding principle that sits across all of these practices is the need for much greater transparency at the beginning of the buying process.”

The DBT said: “Working with the Competition and Markets Authority, new guidance will be created in the coming months to tackle fake reviews which will be added to the list of banned practices, with website hosts held accountable for reviews on their pages.

“The Price Marking Order (PMO), a piece of retained EU law, will also be reformed now we have taken back control of our laws.

“The PMO requires traders to display the final selling price and, where appropriate the final unit price of products in a clear way. The EU’s PMO laws were last updated 20 years ago and no longer reflect modern shopping habits.”

Enterprise, markets and small business minister Kevin Hollinrake said: “From supermarket shelves to digital baskets – modern day shopping provides customers with more choice than ever before. But with that, comes the increased risk of confusion, scams and traps that can easily cost the public more than they had planned.

“Today’s announcement demonstrates the clear steps we’re taking as a government to ensure customers can compare purchases with ease, aren’t duped by fake reviews, and have the sting of hidden fees taken away.”

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