Ticket reselling company StubHub is being investigated by the U.K.’s Competition and Markets Authority (CMA), which said the site was misleading consumers, according to a report by the Financial Times.
The site is potentially facing legal action, and the regulator is already investigating eBay’s proposed sale of StubHub to its rival in the country, Viagogo. The selling price is $4 billion.
“This is a welcome announcement from the CMA, which again highlights continuing dysfunctions in the secondary ticketing market,” said Adam Webb, campaign manager at FanFair Alliance.
Webb said that StubHub practices “industrial scale online ticket touting.”
In the U.K., ticket reselling services have been in the sights of regulators for many years, over concerns that they’re selling tickets to consumers at highly inflated prices. Last year, British MPs said the resale sites were “flouting consumer law.”
Proponents of the sites say they provide a real and legal way for people to buy and trade unused tickets.
The CMA has been watching ticket reselling sites like StubHub over those concerns. The consumer watchdog said it was “concerned” that StubHub wasn’t advertising itself honestly and was “failing to adequately warn people that tickets may not get them into an event” as well as providing and “using misleading messages about ticket availability.”
“StubHub have had years to comply with U.K. consumer law, they were forced to sign legal undertakings in April 2018, and yet they still fall short of expected standards,” Webb said. “If StubHub and other secondary ticketing platforms continue to mislead U.K. audiences, we would urge the CMA to take decisive action through the courts. Today’s developments should also provide yet more impetus for regulators to thoroughly investigate the proposed merger between Viagogo and StubHub.”
The watchdog started the preliminary steps of a probe of StubHub’s acquisition by Viagogo, but hasn’t formally started a “Phase 1” investigation.