Three car hire websites have been ordered by the Competition and Markets Authority to be clearer and more transparent about the charges customers have to pay.
Online travel agency P&P Associates and two operators of price comparison sites, Affordable Car Hire and Flexiblecarhire.com, have committed to include all compulsory charges in their car hire quotes under legally binding agreements.
This means their initial quotes must include mandatory charges like fuel surcharges, young driver fees and out-of-hours pick up charges, where applicable, according to the CMA.
They must also show all essential information including the amounts of any deposits and insurance excesses, policy on fuel charges, and what exactly the insurance covers.
The three businesses co-operated fully with the CMA’s action, which was launched after an investigation into whether certain sites were complying with consumer protection law.
As a result, they have put in place arrangements to check the prices given by their car rental suppliers are fully inclusive going forwards.
Affordable Car Hire chief executive, Angela Day, said the company had made the necessary changes and welcomed the CMA’s decision to enter the car hire market.
Day said: “Allowing full transparency to our clients has always been our number one priority along with service and competitive prices from our car rental partners.”
The CMA is also launching its first direct action against car hire companies based outside the UK following extensive complaints over hidden costs on collection of their car at airports abroad.
The CMA is taking enforcement action against businesses based overseas but selling directly to UK customers online.
The types of problem UK consumers reported experiencing included hidden charges for fuel, surprisingly high excess amounts and hidden insurance costs.
The CMA’s enforcement work was initiated as a result of an industry-wide review of price comparison sites offering car rental, which found many were advertising very low prices to customers by not including all costs.
This left customers paying more than expected at the check-out, and not having the full information required under consumer protection law about what they were paying for.
The CMA worked with companies across the sector, resulting in “significant improvements” in the accuracy and clarity of information available to customers.
Thirty leading websites now carry transparent prices for more than 1,300 car companies in over 10,000 destinations, which means UK customers can be more confident they will not be hit by hidden charges and unexpected fees.
CMA executive director for enforcement, Michael Grenfell, said: “It is important people know what they’re signing up to online when hiring a car.
“Prices must be transparent and include all compulsory costs so that people can find the deal that’s best for them.
“The CMA’s work over the past year has vastly improved the sector and brought the majority of sites offering car hire in line with consumer protection law.
“UK customers can now be more confident that what they see is what they will pay.”
Referring to the latest action covering non-UK firms, Grenfell added: “This move sends a clear message: just because a business is not on UK soil doesn’t mean the law doesn’t apply when it sells in the UK.
“British consumers have a right to protection under consumer law and the CMA will work to ensure they receive it.”