The price you see is the price you pay
17 August 2006
The CAP and BCAP Codes and ASA adjudications have long established the principle of inclusive pricing: claimed prices must include all mandatory charges, which should not be buried away in the smallprint. Most advertisers comply with that requirement most of the time but, especially in the travel industry, some have been reluctant to have transparent prices that are clear and fair to consumers. The CAP Executive has spent a lot of time in recent years trying to ensure that flight prices do not mislead. In traditional media that time has been well spent and we believe quoted prices comply with the Codes.
But still some companies are reluctant to quote prices fairly and responsibly and even the most cursory search of website prices for air travel will reveal prices that exclude non-optional taxes and duties that all buyers will have to pay. On some sites, buyers get to know about the charges only when carrying out the transaction. The ASA does not cover text on companies’ own websites and neither it nor CAP or BCAP has been able to do anything about the discrepancy. Last year, one enterprising Trading Standards department did try but did not convince a UK Court that quoting a basic price and mandatory charges separately was misleading.
In July, however, the European Commission published proposals to improve transparency in flight pricing. You can read the proposals at http://ec.europa.eu./transport/air/whatsnew/index_en.htm. The document, Proposal for a regulation of the European Parliament and the Council on common rules for the operation of air transport services in the Community, states: “… The publication of fares that exclude taxes, charges and even fuel surcharges has become a widespread practice that hampers price transparency. Insufficient price transparency leads to distortions of competition and therefore consumers face on average higher fares. … In the proposal, air fares have to include all applicable taxes, charges and fees and air carriers shall provide the general public with comprehensive information on their air fares and rates and the conditions attached …”. Possibly more contentiously, the EC has proposed common pricing throughout the Community, regardless of the place of residence or nationality of the passenger or buyer.
CAP and BCAP have no position on the latter proposal but certainly welcome the EC’s efforts to ensure, in all media, fair and transparent prices that include mandatory charges.