CMA fines AA-owned driving schools for “drip pricing”

The question

What does the CMA’s enforcement action against AA Driving School and BSM Driving School tell businesses about price transparency requirements (including mandatory fees) and the CMA’s crackdown on "drip pricing"?

The key takeaway

The CMA has imposed a £4.2 million fine and ordered refunds of over £760,000 to be made to consumers after finding that two driving schools failed to include a mandatory booking fee in the upfront price for customers booking driving lessons. This is the first time the CMA has used its new direct enforcement powers under the Digital Markets, Competition and Consumers Act 2024 (DMCCA) to impose a financial penalty for a substantive consumer law breach and secure redress for consumers. 

The background

On 15 April 2026, the CMA announced the settlement of its investigation into AA Driving School and BSM Driving School, both owned by Automobile Association Developments Limited (the AA). The investigation concerned lesson bookings made online between April 2025 and December 2025, where learner drivers were initially shown prices that excluded a mandatory £3 booking fee. For both new and returning customers, the full price was only shown on the checkout page. The CMA held that this practice was a form of illegal “drip pricing”.

The DMCCA requires all "invitations to purchase" to include the total price of the product or service, inclusive of all compulsory charges. Invitations to purchase is widely interpreted and can include everything from early-stage advertising (such a sponsored search engine results, and all stages of the buyer's journey when completing an online purchase). 

The development

The CMA has ordered the AA to make refunds totalling more than £760,000 to over 80,000 affected customers and imposed a £4.2 million fine, bringing the total cost to almost £5 million (which does not cover the additional legal and operational costs of the investigation). The affected customers will not need to take any action: they will be contacted by the AA and automatically refunded via the payment card used (or by cheque if that is not possible). The average repayment is calculated to be £9 per customer.

The penalty fine was reduced from £7 million to £4.2 million because the AA settled early, engaged constructively with the CMA and agreed to a streamlined administrative process. It received the maximum discount of 40% which was only available because the AA admitted to breaking consumer law before the CMA issued a provisional infringement notice.

Why is this important?

This development comes as part of the CMA's wider enforcement drive into unlawful online pricing practices, using its strengthened powers under the DMCCA which came into force in April 2025. Chief Executive of the CMA, Sarah Cardell, explained "If a fee is mandatory, the law is clear: it must be included in the price from the very start – not added at checkout – so consumers always know what they need to pay."

Although the fee here was only £3 per booking, the CMA required widescale refunds with a significant financial penalty. This move signals that even relatively “small” pricing issues can incur significant fines when they affect large numbers of customers. The case also shows that businesses under CMA investigation can substantially reduce potential fines by working proactively with regulators and identifying unlawful practices at an early stage.

Interestingly, this case was announced as open on the same date that the CMA's finalised Guidance on Price Transparency was published (17 November 2025) – i.e. at a time when the CMA was only enforcing clear and obvious drip pricing breaches.  Now that the CMA's guidance has been published and businesses have had time to digest and implement the guidance, we may begin to see more edge case and borderline cases on pricing transparency being opened by the CMA.

Any practical tips?

Businesses should regularly review how their prices are presented to ensure that all price information is provided to the consumer upfront. Be wary of mandatory booking fees, taxes and charges that the consumer will necessarily incur to buy a product or service; these must be included in the total price at the outset, even where in the past these were not.  For example, a separate banner display on an e-commerce site confirming that all orders are subject to a £x delivery charge will not be sufficient.  It is also important to ensure that both new and returning customers are presented with the price in this way.

Given the CMA has shown its readiness to take decisive enforcement action, conducting compliance review now will reduce the risk of CMA enforcement action and ensure that businesses have a full picture of any potential "drip pricing" practices. Particular care should be given to take the CMA's Guidance on Price Transparency into account too.  Whilst that guidance is not legal binding on the CMA, a considerable amount of time, consultation and thought went into its drafting – such that it feels unlikely that the CMA will depart from any of the principle and examples set out within the guidance without very good reason.

In the event of an investigation, businesses should also consider the potential benefits of early engagement with the CMA and settlement (including potential penalty reductions) alongside the likelihood of refunds being required. 

Summer 2026