Cracking down on “drip pricing”

The CMA’s long-awaited second consultation and draft guidance on price transparency (with final guidance expected in autumn 2025) focuses on “drip pricing” and its close counterpart, “partitioned pricing.” Previously, such pricing tactics were tackled under broader, more interpretive provisions of the Consumer Protection from Unfair Trading Regulations 2008 (CPUTRs), often relying on the concept of misleading omissions. In the absence of prescriptive laws and guidance, enforcement (if any) relied heavily on interpretation and precedent. Now, under the DMCC, the rules on pricing are sharper and more defined, with a clear mandate: show the full cost upfront or don’t show a price at all.

It’s not about the money, money, money – it’s about the price, price, price!

Under the DMCC, two key price transparency rules apply to invitations to purchase – that is, any advertisement, listing, or communication displaying both a product and its price. This definition is broad and applies at every stage of the consumer journey. Each time a price is shown alongside a product or its description, it must include all required information, including the total price. The two main prohibitions are:

• Drip pricing: Advertising a headline price only to reveal mandatory fees, taxes, or charges later in the checkout process.
• Partitioned pricing: Displaying prices split into parts (e.g., a base price plus separate fees) without clearly stating the total cost upfront.

Put simply, if there’s a cost consumers must pay to get the product, it needs to be included in the price shown from the outset – whether in an advertisement, on a product page, in marketing emails, or in search results.

The guidance also reiterates that prices are misleading, and therefore may be unlawful, if:

• The product can’t actually be purchased at the advertised price.
• The product is available only in small quantities at the advertised price.
• The terms are very different from what’s shown.
• The trader knows what you need, but the product shown doesn’t meet it, forcing you to pay more.

Finally, prices must be realistic, meaningful, and attainable. If most consumers will need optional extras (such as professional installation), those costs should be included upfront to avoid misleading customers.

Per-transaction charges

Per-transaction charges are mandatory fees linked to the purchase process, not to individual products. Examples include booking fees, administration fees, or cleaning fees. These charges must always be disclosed upfront and ideally included in the total price shown in advertisements or marketing materials.

The draft guidance provides that if the fee applies per product (e.g., £1 per item), it must be included in the headline price of each product. If it’s a single fee per transaction (e.g., a £2.50 booking fee regardless of quantity), the price shown should reflect the total cost for the minimum purchase, such as “from £22.50” for a £20 ticket plus the fee.

For orders with multiple products, it may not be practical to include per-transaction fees in each product price. Instead, traders should provide a clear, real-time running total that includes these charges through features such as a floating basket, dynamic add-to-basket pricing, or automatic basket pop-ups. 

Signed, sealed, delivered (and disclosed)

The draft guidance also dives deeper into delivery charges. If delivery is required to obtain the product and cannot be avoided (e.g., by offering a meaningful and attainable free option such as in-store collection), the lowest applicable delivery cost must be included in the headline price. For example:

• An online fashion retailer must list a £20 dress in search results for £24.50, including its mandatory £4.50 delivery charge.
• On marketplaces where sellers set delivery fees, each product’s headline price must include the specific delivery cost. For example, a £10 photo frame with a £2.99 delivery charge should be shown as £12.99, and an £8 item with a £5.50 delivery charge should be shown as £13.50.

This applies even in early-stage advertising and listings. Optional delivery upgrades (e.g., next-day shipping) may be shown separately but still need to be easily accessible.

Where mandatory delivery charges are fixed (e.g., a flat £4.99 fee), they may be displayed alongside product prices like other per-transaction fees detailed in the section above. For example:

• A homeware store shows a lamp for £25 and a set of plates costing £30. The flat delivery fee of £5.99 is clearly displayed alongside the headline prices of the individual products. When customers add the lamp to their basket, a pop-up immediately confirms the total cost, including delivery.

The draft guidance emphasises that traders must consider any customer information they already hold when displaying delivery charges. For example:

• Food delivery apps can calculate delivery fees upfront because they know the customer’s address through their account or location data. When a customer opens the app, each restaurant listing should show the delivery charge specific to that address. The delivery cost must be clearly displayed on the restaurant’s menu page, and as customers add items to their basket, a running total, including delivery, should always be visible.

What about free delivery beyond a spending threshold? Some traders choose to waive or reduce delivery charges once a customer’s spend hits a certain amount (e.g., free delivery on orders over £40). As per the draft guidance, the delivery cost can still be reasonably calculated upfront. Until the customer’s basket reaches that threshold, the full delivery fee must be included in the total price. Only once the qualifying spend is met can the total price be updated to reflect the discounted or waived delivery charge.

The guidance takes a firm – if somewhat complex – stance, suggesting that businesses with intricate delivery setups (such as tiered delivery fees based on membership levels and/or listings from multiple third-party sellers) may need to embrace dynamic pricing. This marks a sharp pivot from the status quo, where delivery costs are typically applied at checkout. For many traders, this could mean reimagining how prices are structured and presented, ushering in a new era of pricing transparency and strategic adaptation.

When you can’t put a price tag on it…

Exceptions to showing a full total price upfront are narrow and strictly limited. If it’s genuinely impossible to calculate the full cost at the outset – because the price depends on custom inputs or variable factors – the trader must clearly explain how the remaining charges will be calculated. This explanation should be as prominent as the base price. Examples include variable delivery fees, prices per metre of fabric, or flexible hotel rates. Such exceptions apply only when fees truly cannot be fixed in advance.

If the total price can’t reasonably be calculated upfront, traders have a few options:

• Provide a full price list so consumers can calculate it themselves. For example, a photographer could list their hourly rate, price per photo, and costs for different formats.
• Show an indicative or “from” price, provided it is realistic and attainable. For instance, photographers could advertise default bundles (e.g., a 30-minute session with 20 photos and digital files) that consumers can customise, or a hotel could display rates starting from the lowest available price for a standard room. However, this approach must be used carefully. Advertising a “from” price based on midweek rates while promoting a weekend break would be misleading.
• Structure the purchase process to gather all the necessary information before calculating and presenting a total price. For example, car hire companies typically need the pick-up location, dates, and driver’s age before providing an accurate quote.
• Avoid displaying any price until enough details have been gathered to calculate a specific total. Many services – such as home improvement, cleaning, or removals – only provide a quote once they know exactly what’s needed, although indicative pricing in early-stage advertising is still permissible.

Finally, the draft guidance recognises that certain advertising formats – such as limited packaging space or brief advertisements – may restrict how much pricing detail can be displayed upfront. However, traders are generally expected to provide all essential pricing information – such as a clear total or unit price – at the outset, even on small screens or in short advertisements. Only in cases where immediate disclosure is genuinely impractical may full pricing be presented separately, provided it remains clear, easily accessible, and promptly available to consumers.

On the horizon… strengthened subscription rules to take effect in 2026

We can’t overlook the subscription rules set to take effect in spring 2026. The final guidance is hopefully set to be released well in advance – preferably not just one working day before the rules come into force. The Department for Business and Trade has already conducted a consultation on implementing the new subscription contracts regime (Consultation). To recap, for now, businesses should expect to focus on the following:

• Pre-contract obligations

Before entering into a subscription contract, consumers must be fully informed of essential pre-contractual details, including how to exit the contract, payment schedules, and cost information. Two levels of pre-contract information must be provided: key pre-contract information and full pre-contract information, each with specific requirements outlined by the DMCC.

According to the Consultation, no additional regulations are expected regarding pre-contract information. However, further clarification will be provided in the guidance. The guidance is expected to cover the following points, which closely reflect the details already outlined in the Explanatory Notes to the DMCC:

a) In the case of online contracts, key pre-contract information should be clearly and prominently visible in the location where the consumer will enter into the contract and should be directly accessible without the need for the consumer to take any further steps to access and read it.

b) The key pre-contract information should be provided separately from other content, including the full pre-contract information. It should feature before the full pre-contract information and be more prominent. The pre-contract information should not be obscured by the addition of other information that may compete for the consumer’s attention.

c) Both key and full pre-contract information should be presented in a way that is easy for the consumer to understand.

d) All pre-contract information should be designed to ensure it is noticeable to consumers. It should be easy to identify and read, using appropriate font, size, colour, and positioning.

• Reminder notices

Consumers must be reasonably reminded in advance of the final day they can cancel a subscription without incurring the next payment. This reminder must be communicated in a clear, straightforward message, with no unnecessary steps involved. From the outset, it must be apparent that the message is a reminder – for example, by stating this in the email subject line. The DMCC outlines specific requirements for what must be included in the reminder notice, such as the cancellation deadline, instructions on how to cancel, and the amount due. While this critical information should be presented first and with prominence, the Consultation acknowledges that additional content, such as promotional material, may also be included in the reminder notice.

The reminder notice must be issued ahead of the final (or only) renewal payment that falls within a six-month period. If no renewal payment is due within this period, the reminder notice requirement will be triggered whenever the first renewal payment does occur. If the renewal payment will not occur for 12 months (or longer) following the initial subscription, two reminder notices must be sent ahead of the renewal date.

• Cooling-off periods

The DMCC gives consumers a 14-day subscription cancellation window from the date of their first payment. This mirrors existing consumer rights for distance contracts and provides an essential safeguard against unintended commitments. In addition, the DMCC introduces a renewal cooling-off period – a new layer of protection that begins once a free trial or promotional period ends and the full contract automatically begins. To support these rights, the DMCC requires businesses to send clear reminder notices in advance of key renewal points, including a cooling-off notice that outlines consumer renewal cooling-off rights. Additional regulations are expected to set out the consequences of cancelling a contract within either the initial or renewal cooling-off periods, depending on the category of goods or services.

As yet, no formal guidance has been issued on the above subscription requirements, and key operational details remain to be clarified through secondary legislation. These include specifics such as how far in advance of renewal a reminder notice must be sent; whether consumers will retain the right to waive cooling-off periods for subscription services, as permitted under the current rules; and whether refunds will be required if a consumer cancels a partially used subscription during the cooling-off period.

What actions should businesses be taking?

The DMCC imposes clear and proactive obligations on businesses to ensure price transparency and compliance with new subscription rules. While we’re in “wait and see” mode pending the final guidance, it’s a good idea to start thinking ahead. Chances are that, once the rules land, businesses covered by the DMCC will need to take the following actions:

• Develop clear, accessible policies for upfront disclosure of all mandatory fees, charges, and delivery costs in consumer-facing price communications.
• Audit pricing structures and advertising materials to eliminate drip and partitioned pricing, ensuring total prices are displayed from the outset.
• Implement real-time pricing tools (e.g., dynamic baskets or floating totals) where per-transaction or variable fees apply.
• Ensure delivery charges are correctly displayed upfront, including the lowest applicable fee – even for complex or tiered delivery models.
• Prepare for subscription rule changes by putting in place systems to deliver pre-contract information, send timely reminders, and enable easy cancellation and cooling-off.
• Update internal processes and train staff to reflect the new requirements for transparent pricing and subscription management.
• Stay alert to CMA updates, reviewing and adapting practices as further guidance and enforcement expectations emerge.

In-depth 2025-209