When shopping online, you might have encountered a surprise fee added at checkout. If this happens to you, the Competition Bureau of Canada wants to know about it.
These undisclosed fees and surcharges, known as “drip pricing,” are now considered unlawful under the Competition Act.
Processing fees, booking fees, cleaning fees, and administrative fees are allowed to be charged if they are disclosed with the initial price offering. The Competition Act does not allow for businesses to withhold these fees until the final checkout stage, and “ambush” the customer.
In November 2023, the Bureau imposed an $825,000 fine on ticket reseller TicketNetwork for drip pricing, finding that the company misleadingly advertised prices inflated by up to 53 percent through undisclosed fees. Ticketmaster faced a $4 million penalty in 2019, and StubHub was fined $1.3 million in 2020 for similar conduct.
Recent amendments to the Competition Act explicitly label undisclosed fees and surcharges that make the initial advertised prices “unattainable” as a “harmful business practice.” Government-imposed charges like sales taxes are exempt from these rules.
If you believe you have encountered “drip pricing” while online shopping, you can reach out to us here.
