New EU rules may put pressure on unexplained ticketing charges

May 2013

Live events industry


New regulations have come effect last weekend that will stop UK companies from including anything but ‘cost of sale’ in payment surcharges which may have a major impact on the ticketing business where a variety of additional costs are often added the cost of tickets including credit card booking fees, delivery, ‘transaction’ and ‘booking’ fees . The Regulations ban traders from charging consumers more than the cost borne to them for accepting a given means of payment.

The Consumer Protection (Payment Surcharges) Regulations which stem from EU legislation were passed by the UK parliament last year and brought into effect on the 6 April  say that where credit card fees are added to purchases, a seller can’t use that extra charge to increase profit margin, ie the fee must only cover costs directly linked to the credit card transaction.

The Department for Business, Innovation and Skills has issued guidelines to try to define “costs directly linked to the credit card transaction. Fees charged to a seller by a credit card provider can be included, and according to the guidelines so can any costs directly related to fulfilment  – IT costs, risk management and anti-fraud efforts. More general administration costs would not be allowed to be included though as, says the guidelines, these are general business requirements that should be covered by the price of the original product.

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