Special Report: ‘CMA’s new pricing rule is a recipe for confusion’

The Competition and Markets Authority’s new requirements on pricing are “a recipe for confusion”, but operators, agents and all other businesses selling to consumers have no option but to comply.

 

That is according to Advantage Travel Partnership chief executive Julia Lo Bue-Said, who said the CMA’s guidance issued in mid-November and its letters warning businesses of the risks of non-compliance sent out last month “hit everyone like a tonne of bricks” heading into the January peak sales period.

 

She suggested the Jet2holidays notice issued to trade partners last week had alerted many agents to the urgency of the issue (Travel Weekly, January 5).

 

Lo Bue-Said argued: “The timing and extent of the change are unhelpful. It has taken everyone by surprise.”

 

More: CMA action confirms it has travel industry in its sights

 

She noted: “A change like this is going take you away from selling, especially if you’re a smaller business. But it’s not optional. This has to be done.

 

“If you are advertising holidays, any payments in the destination must be included in the adverts and not just in the booking process. The taxes payable in resort can’t be left out.

 

“You need to be clear what has to be included, and you need to show the price the customer must pay you and also what they will have to pay in resort.”

 

So, if the taxes in resort will amount to £20 per person for the period of a holiday, the ‘total’ price should include that £20 per person, along with a note explaining that the fees will need to be paid in the local currency along with the exchange rate used to calculate the charges in sterling, and a note that the exchange rate could change.

 

More: Businesses must take action now to comply with CMA guidance

 

Lo Bue-Said suggested “it’s a recipe for confusion”, adding that “there is no experience yet” of what the CMA guidance means in practice.

 

But there is considerable work going on to try to clarify the best practice.

 

Lo Bue-Said reported “regular meetings with members, particularly larger operators” to discuss compliance and said: “We’re learning from each other. Everybody wants to do the right thing.

 

“We’re working with Abta, with bed banks and with suppliers to ensure we understand what we have to do. It’s in everybody’s interests to ensure compliance and that there are no breaches.”

 

She argued: “The industry needs to work together because some businesses will have more information. The more we can work collaboratively, the better. We can learn from one another.”

 

However, Lo Bue-Said also insisted: “From a consumer point of view, we understand this has to be done.”

 

She told Travel Weekly: “I’m confident the industry will do the right thing for consumers and do everything it can to comply.”