Canada’s Competition Tribunal ruled that Cineplex’s $1.50 online booking fees were illegal, and ordered the movie theatre chain to pay a penalty of $38.9 million. 

Canada’s Competition Bureau brought the action to the Tribunal in May 2023. The Bureau argued that Cineplex’s online booking fees were a form of illegal drip pricing, based on 2022 revisions to the Competition Act. Drip pricing involves showing consumers a price that is unobtainable because of mandatory charges that the consumer must ultimately pay, above any represented price.

The Bureau argued that the cinema chain’s practice of charging an additional $1.50 on every online ticket purchase added a fee that prevented consumers from buying tickets at an advertised price. Cineplex reduced the fee for Scene+ members and eliminated it for CineClub members, and also argued that consumers could get the advertised price for tickets purchased at a theatre. 

In its two-page summary, the Tribunal agreed that the ticket prices displayed on Cineplex’s web site and mobile app were inaccurate. “The consumer is deceived or led astray by the contradictory and incomplete information on Cineplex’s tickets page, which obfuscates the existence and quantum of the online booking fee.” 

The Tribunal ordered to Cineplex to pay a financial penalty of $38.9 million, the amount Cineplex had gained from the online booking fees between June 2022 and December 2023. The Bureau filed a statement of fact earlier this year that showed Cineplex made more than $11.6 million after introducing the fees in June 2022, and another $27.3 million from the fees in 2023. 

In a news release announcing the decision, Commissioner of Competition Matthew Boswell noted that the decision was “a resounding win for Canadians” that businesses should not engage in drip pricing, and that those “that fail to comply with the law risk significant financial penalties.” 

Cineplex maintained that its online booking fees were displayed “in a clear and prominent manner”, and that it intended to appeal the decision. 

“We believe our guests make informed purchase decisions and remain confident our online booking fee is presented in a way that fully complies with the spirit and the letter of the law,” it said in a release. 

Cineplex also faces several class action lawsuits that also seek compensation for misleading advertising.