Price Transparency: CMA Draft Guidance under the DMCCA
I. Following the commencement of the consumer provisions of the Digital Markets, Competition and Consumers Act 2024 [DMCCA] on 6 April 2025, the Competition and Markets Authority [CMA] has published draft guidance on price transparency. A public consultation is open until 13 September 2025, with finalised guidance expected later in the year.
II. This follows concerns raised over the Competition and Markets Authority’s earlier guidance on unfair commercial practices [published December 2024 and finalised April 2025], which was seen as creating uncertainty around the interpretation of pricing-related provisions particularly drip pricing. In response, the Competition and Markets Authority committed to issuing standalone guidance to provide greater clarity.
Key Legal Points
III. Invitation to Purchase [ITP]: An Invitation to Purchase is any communication that includes a product and its price such as advertising, listings, and/or price tags. It does not require a direct purchase mechanism. Multiple Invitation to Purchases may occur during a consumer journey, and each must comply with the information requirements.
IV. Required Content of an ITP:
Pricing must be accurate, non-misleading, and realistically attainable.
The total price, inclusive of all mandatory fees, charges, and taxes, must be stated.
Where elements of the price cannot be calculated in advance, a clear explanation of the calculation method must be provided with equal prominence to calculable elements.
Pricing must be presented clearly, prominently, and at the appropriate stage of the transaction.
V. Mandatory vs Optional Charges:
Charges are mandatory where the product cannot be purchased without them [for illustration admin fees, delivery, local taxes, transaction fees].
Delivery fees are considered mandatory even where multiple options are offered; only the lowest-cost option needs to be shown in the headline price unless a more expensive option is chosen.
Optional charges may still require inclusion in the total price where it is reasonably foreseeable that the majority of consumers will incur them.
VI. Prohibited Practices:
Drip pricing: where additional mandatory charges are revealed only later in the process is not permitted.
Partitioned pricing: presenting prices in parts without a total is generally prohibited unless the total cannot be reasonably calculated in advance. Any pre determinable portion must still be disclosed upfront.
VII. Enforcement Considerations
Although the substantive requirements largely mirror those under the former Consumer Protection from Unfair Trading Regulations 2008, the DMCCA grants the CMA enhanced enforcement powers, including the ability to impose civil penalties of up to 10% of global turnover without recourse to court proceedings. Businesses should undertake a thorough review of their pricing structures and advertising practices to ensure full compliance with the evolving regime.
Consumer Law Update [Final]
Price Transparency: CMA Draft Guidance under the DMCCA
I. Following the commencement of the consumer provisions of the Digital Markets, Competition and Consumers Act 2024 [DMCCA] on 6 April 2025, the Competition and Markets Authority [CMA] has published draft guidance on price transparency. A public consultation is open until 13 September 2025, with finalised guidance expected later in the year.
II. This follows concerns raised over the Competition and Markets Authority’s earlier guidance on unfair commercial practices [published December 2024 and finalised April 2025], which was seen as creating uncertainty around the interpretation of pricing-related provisions particularly drip pricing. In response, the Competition and Markets Authority committed to issuing standalone guidance to provide greater clarity.
Key Legal Points
III. Invitation to Purchase [ITP]:
An Invitation to Purchase is any communication that includes a product and its price such as advertising, listings, and/or price tags. It does not require a direct purchase mechanism. Multiple Invitation to Purchases may occur during a consumer journey, and each must comply with the information requirements.
IV. Required Content of an ITP:
V. Mandatory vs Optional Charges:
VI. Prohibited Practices:
VII. Enforcement Considerations
Although the substantive requirements largely mirror those under the former Consumer Protection from Unfair Trading Regulations 2008, the DMCCA grants the CMA enhanced enforcement powers, including the ability to impose civil penalties of up to 10% of global turnover without recourse to court proceedings. Businesses should undertake a thorough review of their pricing structures and advertising practices to ensure full compliance with the evolving regime.
Clear Costs - Informed Choices - Compliant Contracts