The Competition Bureau of Canada is suing movie theatre chain Cineplex (CGX) over junk fees it allegedly charges consumers when purchasing tickets online.
The Competition Bureau is accusing Cineplex of advertising misleading ticket prices and breaking the law by adding an additional fee that raises the price of movie tickets that are bought online.
The government agency said an investigation it carried out found that consumers can't buy tickets online at advertised prices because there is a mandatory $1.50 fee for booking online.
The Bureau alleges that the booking fee is misleading and amounts to a junk fee charged to consumers. An amendment to Canada’s Competition Act last June recognizes “drip pricing,” also known as junk fees, as a harmful business practice.
Cineplex has said that its Scene Plus rewards members pay a reduced price of $1 per ticket purchased online, while members of CineClub, the company's subscription plan, do not pay the fee at all.
The Competition Bureau has filed an application with the Competition Tribunal seeking for Cineplex to stop what it calls deceptive advertising, pay a penalty, and make restitution to impacted consumers.
The federal government in Ottawa has been targeting junk fees charged to consumers in recent months as it seeks to lower costs with inflation elevated across the country.
Cineplex’s stock has declined 19% over the last 12 months and currently trades at $10.03 per share.
