Canada’s Competition Bureau has launched a lawsuit against Cineplex, the country’s largest theatre chain, accusing it of advertising misleading ticket prices. The Bureau alleges that Cineplex is violating the law by adding an extra fee to the price of its tickets purchased online, a practice known as drip pricing.
The Bureau’s investigation revealed that many consumers are unable to purchase tickets at the advertised prices on Cineplex’s website or mobile app due to a mandatory $1.50 online booking fee. This fee, according to the Bureau, is a clear example of drip pricing, sometimes referred to as a junk fee.
Recent amendments to the Competition Act explicitly classify drip pricing of mandatory charges or fees as a detrimental business practice. Unless the additional fixed charges or fees are government-imposed, such as sales tax, drip pricing is considered false or misleading under the law.
The Bureau alleges that since Cineplex quietly introduced the online booking fee in June 2022, it has generated significant revenues for the company. As a result, the Bureau has filed an application with the Competition Tribunal, seeking for Cineplex to cease the deceptive advertising, pay a penalty, and issue restitution to affected consumers who purchased tickets through Cineplex’s website or app.
Cineplex claimed at the time the online booking fee was to “fund the expansion and improvement of our digital infrastructure,” whatever that means. Scene+ members did get a discount at $1, while CineClub members saw the online fee waived.
No wonder moviegoers are skipping theatres and streaming movies at home. First, overpriced popcorn with buttery-like topping and now hidden fees. Skipping theatres can also thank your waistline as you get to skip eating a whole bag of Sour Kids all to yourself in the dark.
“Consumers expect to pay the advertised price. We’re taking action against Cineplex because misleading tactics like drip pricing only serve to deceive and harm consumers. For years, we have urged businesses, including ticket vendors, to display the full price of their products upfront. I remind all businesses to review their pricing claims to make sure they do not mislead consumers,” said Matthew Boswell, Commissioner of Competition, in a statement on Thursday.
The Bureau has a history of taking action against drip pricing, notably in the car rental and online sporting and entertainment ticketing industries. It strongly encourages anyone suspecting deceptive marketing claims to report it using its online complaint form.
