The Competition and Markets Authority (CMA) published new guidance on price transparency in November under the Digital Markets, Competition and Consumers Act 2024.

For travel businesses, the message is clear – if a charge is unavoidable, it should be part of the advertised price. This applies even if it is not collected by the travel agent or tour operator and is instead paid by the customer at the hotel or destination.

This is a significant shift for many travel and accommodation providers, whose pricing models have historically treated "local taxes" or "resort fees" as separate from the headline price.

The guidance applies to any business advertising prices to UK consumers. This includes agents, operators, cruise lines, OTAs and airlines. If you make the consumer facing price available, you may be liable if the headline price omits mandatory charges or otherwise misleads.

Bed banks and wholesalers can also be drawn in where their pricing feeds or content drive how prices are presented downstream, or where they make consumer facing prices available themselves.

What's changed?

So what's changed for travel businesses? Firstly, headline prices must reflect the true total cost. The CMA expects consumers to be shown the total price upfront, i.e. a fully inclusive price, including mandatory fees, taxes and charges that the consumer will necessarily have to pay.

Secondly, the CMA is explicit that local taxes, resort fees and other unavoidable charges payable on arrival or departure fall into the scope of its guidance given that in most cases, these costs are typically mandatory and reasonably calculable meaning they should be included in the advertised price, including any "from" pricing.

This applies even where the charge is paid locally rather than at the booking stage, when it is paid to a hotel or local authority rather than to the travel organiser, and/or where it is charged in a foreign currency.

If a charge cannot be reasonably calculated in advance, the non-calculable element should be displayed with equal prominence next to the headline price, together with enough information for the consumer to calculate it.

Thirdly, where part of the cost is paid later, for example, local tourist taxes at check in or check out, the CMA expects the customer to be shown a clear, consolidated total and an explanation of what is payable when. Presenting "pay-now" and "pay-later" elements in different currencies without a clear total creates obvious compliance risk.

Finally, drip pricing is prohibited. The guidance reinforces how businesses should not show an attractive headline price and then introduce mandatory charges later in the booking journey.

(Credit: Themis Advisory)

It is important to note enforcement is live. The CMA has publicly signalled price transparency is a priority and confirmed it has already started engaging with businesses on compliance, including issuing advisory letters and opening investigations in late 2025.

In our view, travel businesses should assume this will be an active enforcement area given the historic consumer sensitivity around travel pricing and the CMA’s focus on mandatory "add-on" charges.

We do not expect an extended grace period for compliance with the updated guidance, although the CMA has indicated it will proactively work with businesses to help them comply rather than seek enforcement action immediately.

Given the CMA has new powers to make decisions regarding breaches of consumer law and impose fines without court action, it is important to take proactive steps towards compliance now.

We recommend travel businesses urgently review:

• Headline prices and "from" prices, including ads, search results, brochures, email marketing and product listings to ensure local taxes, resort fees and other mandatory charges are included wherever they can be calculated;
   
• Booking flows and processes to ensure mandatory charges are not being added later in the journey, thus minimising any drip pricing risk;
   
• How "pay-later" charges, including foreign currency charges, are displayed, ensuring consumers can see a consolidated total and a clear breakdown of what is paid now versus later;
   
• Third-party channels and affiliates, where pricing presentation is often constrained, but still needs to be compliant; and
   
• Supplier information and agreements to ensure all mandatory charges are properly communicated and captured for pricing purposes.