Online ticket resellers like Viagogo and Stubhub could soon be shut down for breaking consumer protection rules

Industry

Online ticket resellers like StubHub and Viagogo could be shut down entirely for breaking consumer protection rules under new proposals.

Ticket retail platforms are facing strict new measures which could see them slapped with severe fines or even shut down to “help prevent people getting ripped off by unscrupulous resellers online”.

The Competition and Markets Authority (CMA) has made an uncompromising intervention into the sector, demanding new powers to help it tackle illegal ticket touts who have made millions from such websites.

It said that while it has taken “strong action” to protect consumers, there were “limits to what the CMA and other enforcers can do with their current powers.”

These new proposed recommendations would require secondary ticket sites to be licenced, and give the CMA the power to take down websites, withdraw a businesses right to operate and impose fines on those who broke the rules.

It would also ban platforms from allowing resellers to sell more tickets for an event than they can legally buy from the primary market, a major issue known as speculative selling.

READ MORE: Ebay sells StubHub to Viagogo for $4bn

According to an investigation by The Guardian earlier this year, ticket touts were advertising £1 million worth of tickets they did not yet have on Viagogo.

Platforms would also be held liable for incorrect information about tickets listed on their platforms.

“With live music and sporting events starting back up, we want the government to take action to strengthen the current laws and introduce a licensing regime for secondary ticketing platforms,” the CMA’s senior competition director George Lusty said.

“If adopted, these proposals will help prevent people getting ripped off by unscrupulous resellers online and we stand ready to help the government to implement them.”

Viagogo has repeatedly come under scrutiny from the CMA and was forced by the regulator to sell its StubHub operations outside of North America a year after buying it.

A Viagogo spokesperson told The Guardian: “We welcome the exposure this gives to the strength of Viagogo’s customer protections and the recognition of the importance regulated platforms play in ensuring customer confidence when accessing live events.

“The CMA notes their report is not as a result of customer complaints and, moreover, that a ban on secondary platforms would lead to an explosion in black market sources for tickets.

“We are open to all ideas as to how that is achieved but it must be carefully considered and focused on improving the industry’s service for customers. There is a need to address the failings of the primary market and we need to explore the risks of new and unregulated online resale channels.”

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