ACM: advertised prices in travel industry must be clearer

The Netherlands Authority for Consumers and Markets (ACM) today launched a consumer information campaign as well as several special initiatives to increase price transparency in the travel industry. With these efforts, ACM wishes to put an end to unclear prices in the travel industry such as prices of airline tickets, holiday homes, and organized tours. ACM wants all advertised prices to include all unavoidable costs, and that consumers can select optional services themselves by ‘opting in.’ Consumers must be able to book the trip or accommodation for the advertised price. These rules are already in effect, but are still too often ignored by the industry. That is why ACM, supported by trade organizations, will be enforcing compliance with the rules in the next few months, and, if necessary, will force companies to comply. Anita Vegter, member of the Board of ACM, adds: ´It is time that the travel industry stops using unclear prices. It is an undesirable situation for both consumers and the industry itself. If clear prices are used, a level playing field for businesses is created, thereby enabling consumers to make better comparisons and better choices.´

Rules for clearer prices

In order to make it easier for the travel industry to adopt clearer prices, ACM summarized the rules in five points:

1. The price in the advertisement is the price at which the booking can be made.
2. All unavoidable costs are included in the advertised price.
3. All variable, unavoidable costs are listed directly with the advertised price.
4. Optional products and services are clearly mentioned at the beginning of the booking process with their prices.
5. The checkboxes for these optional products and services cannot be ticked in advance.

These five points have been deduced from the rules that govern the clear indication of prices such as the Dutch Unfair Commercial Practices Act, the EU´s Aviation Directive, and the Advertising Code for Travel Offers. For today’s launched initiatives, ACM consulted with relevant trade organizations. ACM has consulted them because its oversight builds on the private foundation laid by trade organizations and the Dutch Advertising Code Authority. They, too, support the initiative to bring about clearer prices in the travel industry, and have indicated they will incorporate the abovementioned points into the Advertising Code for Travel Offers.

It must be clear to consumers at the start of the booking process what the booking’s total price will be, including all unavoidable costs. The variable unavoidable costs should be clearly mentioned with the advertised price from the start as well. Other additional costs can only be added if consumers themselves choose to purchase optional services or products, and only if they select these themselves. These costs must be mentioned clearly at the start of the booking process. Consumers will then immediately be able to see what the total amount will be, and they will not be surprised by extra costs that have been added during the booking process. This issue was named a priority in the Agenda of the Netherlands Consumer Authority, and is now a priority of ACM.

Consumer information campaign

In order to educate consumers on what clear prices in the travel industry look like, and how to compare them, ACM today launched a consumer information campaign through its consumer information portal ConsuWijzer. The lowest advertised price is not necessarily always the best offer. Exactly what the best offer is depends on the optional extras that consumers may want to add to their bookings. For example, with airline tickets, the costs for checking luggage or checking in online may differ considerably. That is why consumers can find more information on ConsuWijzer.nl, where they will also find an interactive tool to add up all extra costs for their trips. Only then are consumers able to make a proper comparison. Consumers who encounter providers that violate the rules may contact ConsuWijzer. Such indications help ACM enforce the rules in order to bring about clear prices in the travel industry.

In the next few months, ACM will direct particular attention to this issue. Businesses that do not comply with the rules can be fined up to EUR 450,000 per violation.