The DMCC Act and consumer protection: Misleading pricing and drip pricing

It is a well-established principle of consumer law that the failure to give consumers information they need to make an informed transactional decision in relation to a product may be misleading and unfair. 

However, most people will have, at least once in their life had the burning urge to scream after having spent a fair amount of time carefully selecting the products they want only to proceed to the checkout to find that what they have to pay is greater than what was advertised. 

The The Digital Markets, Competition, and Consumers Act 2024 (DMCC) looks to tackle this in two ways. 

1. It confirms that the omission of material information from any communication (such as a product listing or social media ad) which provides information about the characteristics of a product and its price, which entices or appears to entice the consumer to purchase the product or make another transactional decision in relation to the product (i.e. an invitation to purchase) is an unfair practice irrespective of whether it is likely to impact a consumer’s transactional decision. For this purpose information will also be considered omitted if it is provided in an unclear or untimely way – including if it is in small print, faint coloured font or via separate click through windows.
2. It bans 'drip pricing', which is the practice of layering additional charges which the consumer cannot avoid onto the headline price during the checkout process. 

Under the new rules traders must display both the headline price for a product and any additional mandatory charges (such as delivery fees or taxes) within the invitation to purchase. 

If the whole or any of part of the total price cannot be reasonably calculated in advance then the invitation to purchase must clearly set out how the price will be calculated. 

Information about the additional mandatory charges (or how they are calculated) must be given as much prominence as the headline price.

Any charges which are genuinely optional – for example enhanced delivery or gift wrapping – can be indicated separately from the headline price and do not need to be given the same prominence as it. 

Action for retailers

Traders should review their websites and the way in which they display information about product prices and any additional mandatory charges carefully to ensure that these are clearly communicated to consumers at the point they decide whether or not a product should be put in their basket (e.g. on the product page) and not after they have already made the decision to buy it and have started the checkout process.

Particular care should be given as to how and with what prominence the information about the additional mandatory charges is given. For example, if delivery charges will apply, information about these charges should be clearly set out near the headline price. For example 'Standard delivery: £x' above or below the product price. If there is a lot of information to be given about delivery options, this could be included in a pop up window accessed by clicking a 'delivery charges' link next to the product price. It is not, however, sufficient to bury details of the delivery charges in a link at the bottom of a product page and expect the consumer to go hunting for this information.