UK competition regulator backs government plan to cap ticket resale prices
The Competition & Markets Authority has made a submission to the UK government that strongly backs a proposal for a resale ticket price cap.
The UK’s Competition and Markets Authority (CMA) has formally backed the government’s proposal to introduce a price cap on tickets resold via the secondary market. In its submission to the government’s ongoing consultation, the CMA stated that such a measure would protect consumers from “excessive resale pricing” and ensure a fairer ticketing system.
The government’s consultation, launched in January, follows the Labour Party’s commitment to tackling inflated ticket resale prices ahead of last year’s General Election. The proposed cap would limit resale prices to a fixed percentage above the original ticket cost, aiming to stop ticket touts from charging fans excessive fees. While the CMA had previously recommended additional regulations to improve the secondary ticketing market, it did not initially propose a price cap. Now, it has acknowledged that a cap is necessary to prevent overpricing.
In its submission, the CMA argued that price caps in secondary ticketing would not raise the same concerns often associated with similar interventions in other markets. This is because the cap would be based on the face value price set by the original ticket seller, meaning that “the market is still ultimately dictating the price.” It also noted that the cap could reduce the number of professional resellers, which would likely lead to more tickets being available on primary ticketing platforms.
The CMA further stated that “an effective ban on uncapped resale may increase the overall benefits to consumers, with less consumer surplus being transferred to resellers.” This suggests that capping resale prices could result in a fairer system where more fans can purchase tickets at reasonable prices rather than being forced to pay inflated secondary market rates.
However, the regulator emphasised that a price cap would only be effective if properly enforced. It called for a “well-designed and adequately resourced enforcement framework” to ensure compliance. Given the nature of the secondary ticketing market, the CMA argued that both ticket resellers and the platforms they use, such as Viagogo, should be held responsible for enforcing the cap. “Making platforms liable for ensuring tickets listed on their sites are compliant with any price cap would significantly simplify enforcement and improve overall compliance,” the submission stated.
To further strengthen enforcement, the CMA proposed a licensing system for resale platforms. It explained that for high-demand events, there would be “strong incentives to circumvent the cap,” making it essential for enforcement agencies to be able to act swiftly. If resale platforms were required to be licensed, authorities could take quicker action against non-compliance.
Another challenge highlighted by the CMA is the transparency of ticket pricing. Since primary ticket sellers often apply extra fees to the face value price, it is not always immediately clear what a buyer originally paid for their ticket. The CMA suggested that the government should introduce a “proportionate requirement for primary sellers” to disclose original ticket prices, helping both consumers and regulators determine whether resale listings comply with the cap.
The CMA’s endorsement of the proposed cap comes at a time when secondary ticketing is facing increasing regulation worldwide. Last week, US-based ticket resale giant StubHub filed paperwork for an Initial Public Offering (IPO) with the US Securities and Exchange Commission, acknowledging in its filing that tighter regulations in various countries could impact its business. The document noted that “artists and promoters may attempt to disrupt the secondary ticketing market through lobbying for such restrictions regarding secondary ticketing policies.” StubHub admitted that increased regulation “would require us to change certain aspects of our business, operations, and buyer and seller relationships to ensure compliance” and that such changes could “decrease demand for services, reduce revenue, increase costs and/or subject us to additional liabilities.”
