The UK competition watchdog has launched an investigation into Trainline, Virgin Atlantic and Red Driving School over hidden fees.
The Competition and Markets Authority (CMA) said some consumers could be owed compensation if it is found that the companies broke the law.
The probes are part of a wider clampdown by the regulator over misleading pricing practices, which includes instances where mandatory charges are separated from the headline price or added later in the buying process, known as ‘drip pricing’.
Shoppers could therefore face unexpected costs or have to calculate the total cost of a purchase themselves.
“Such practices can also impact competition between businesses, as a firm using drip pricing may falsely appear to be cheaper than a competitor and attract more customers,” the CMA added.
The Trainline investigation focuses on whether all mandatory fees were displayed upfront to travellers buying train and coach tickets in advance, on its app and website.
The CMA said it observed transactions with additional fees ranging from 50p to £2.79, with a £1.50 booking fee for coach journeys.
The investigation into Virgin Atlantic is looking into mandatory resort fees and local taxes for package holidays.
Red Driving School is being investigated over how a mandatory booking fee and a so-called digital fee – typically £7 per booking – were displayed for driving lessons.
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.
“Unexpected mandatory charges make this much harder, which is why the CMA initially put these firms on notice over concerns about their pricing practices and is now opening formal investigations.”
A Trainline spokesperson said: “Trainline is committed to offering customers a transparent booking experience with clear pricing and genuine value. 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.”
Shares in the Trainline tumbled by around 15 per cent to 206.1p in early trading on Wednesday.
A Virgin Atlantic Holidays spokesperson said: “We take our responsibility to customers incredibly seriously and we always want to ensure they can make an informed decision when booking a holiday with us. 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.”
Red Driving School has also been contacted for comment.
Sue Davies, head of consumer rights policy at Which?, said: “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.
“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.”
