Viagogo agrees to ‘overhaul’ its site following legal proceedings brought by the Competition and Markets Authority
One of the UK’s largest ticket re-selling sites, Viagogo, has reached a major settlement with the Competition and Markets Authority (CMA) on the eve of a widely anticipated court battle. The settlement is founded on Viagogo agreeing to a ‘comprehensive overhaul’ of its UK website.
In 2017 the CMA commenced enforcement action against four major secondary ticketing websites following formal investigations, which included a series of high-profile raids, into their consumer protection practices. As a result of the enforcement proceedings, three of four sites, StubHub, GETMEIN! and Seatwave, offered binding commitments in April 2018 to reform their business practices to address the consumer protection concerns identified by the CMA. Ticketmaster subsequently took matters further by closing its two secondary ticketing platforms, Seatwave and GETMEIN! in August.
However, the fourth of the sites under the scrutiny of the CMA, Geneva-based Viagogo, declined to offer corollary assurances to those given by the other three secondary ticketing site. Viagogo maintained its position despite receiving an unequivocal warning from the CMA stating that court proceedings would ensue from a failure to instigate meaningful reform for the benefit of consumers.
The CMA started a claim formalising allegations that Viagogo was breaching consumer law with the result that consumers were notably:
- Given misleading information about the availability and popularity of tickets;
- Not being informed of any risk that they may be turned away at the door;
- Potentially being offered tickets that a seller did not own and could not therefore provide;
- Not being told which seat in a particular venue they were being assigned;
- Experiencing difficulties in getting a refund under Viagogo’s guarantee when things went wrong; and
- Not being given the identity of the seller.
In addition to its underlying claim, the CMA applied to the court for an interim enforcement order to curtail a number of Viagogo’s illegitimate practices pending a full trial at a later date.
The evening prior to the hearing of the CMA’s interim application, final talks were held. A settlement was reached in which Viagogo agreed to a permanent and ‘comprehensive overhaul’ of its UK website. The court has now approved that settlement.
As a result of the settlement Viagogo will be required to:
- Inform purchasers of any risk that they may turned away at the door due to restrictions of promoters i.e. restrictions on re-sale;
- Publish the face value of the tickets as well as the seat number being purchased for the event;
- Fortify its consumer guarantees and improve its complaints handling procedure;
- Impose restrictions on ‘speculative selling’ where the tickets advertised may not exist;
- Provide information about who is selling the ticket, so buyers can benefit from enhanced legal rights when purchasing from a business; and
- Refrain from giving misleading information about the availability and popularity of tickets.
Viagogo will have until January 2019 to fully implement these changes. Failure to do so may result in substantial penalty fines and possibly the prosecution of senior members of staff.
The additional protection provided by this settlement will undoubtedly be welcomed by Viagogo’s users, many of whom have reportedly been subjected to considerable uncertainty regarding the pricing, nature of, and origin of tickets bought through Viagogo in the past.
As an enforcer under Part 8 of the Enterprise Act 2002, the CMA is unable to levy administrative fines but can enforce consumer protection legislation (including the Consumer Rights Act 2015) through the courts.
Given that the CMA has repeatedly proven its willingness to litigate where there have been ostensible breaches of consumer protection law, it is imperative that organisations are aware of the standards and regulations that they are legislatively bound to observe. Failure to be mindful of the regulatory framework may well result in a CMA investigation.
Should an organisation find itself subject to the scrutiny of the CMA it is critical that appropriate legal advice is sought. The above case provides a poignant example of how a business’s conduct can exacerbate regulatory problems where they might feasibly be dealt with expeditiously without the need for costly litigation or wasted management time.
This briefing is for guidance purposes only. RadcliffesLeBrasseur LLP accepts no responsibility or liability whatsoever for any action taken or not taken in relation to this note and recommends that appropriate legal advice be taken having regard to a client's own particular circumstances.