Driving Enforcement: CMA Imposes Its First UK Consumer Law Fine On The AA For Drip Pricing

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The Automobile Association (AA) has been fined GBP4.2 million and ordered to pay over GBP760,000 to refund customers for breaching UK consumer law. The action is significant. It marks the first financial penalty for a consumer law infringement since the UK Competition and Markets Authority (CMA) obtained its tough new consumer enforcement powers. It also highlights the potential benefits to businesses of engaging with the CMA and agreeing to early settlement of investigations.

The UK’s revamped consumer protection regime took effect in April 2025. Companies in breach of the rules face fines of up to 10% of their global turnover.

As the first concluded investigation under the new regime, the AA case is groundbreaking. We examine the CMA’s proceedings, pulling out five key takeaways for businesses.

1. Drip pricing is a clear enforcement priority

The AA case concerns “drip pricing”, a practice where unavoidable charges or fees are not disclosed to customers from the outset but are included later in the purchasing process. Drip pricing is a banned practice under UK consumer protection rules.

The CMA found that the AA Driving School and BSM Driving School (both owned by the AA) engaged in drip pricing by failing to show more than 80,000 learner drivers the total price upfront when they were booking driving lessons online. A GBP3 mandatory booking fee was included later, at checkout.

In its press release announcing the decision, the CMA references UK government research showing the significant consumer harm caused by dripped fees. The authority also highlights that it is prioritizing enforcement in this area. It sees the AA case as a “significant milestone.”

The CMA is currently investigating several other allegations of drip pricing and has reiterated its commitment to action in this area. Businesses should review their online pricing practices/customer journeys and adjust where necessary.

2. The CMA is willing to impose multimillion-pound fines

The infringement will cost the AA nearly GBP5m.

The GBP4.2m fine is itself significant. Additionally, the CMA imposed Enhanced Consumer Measures obliging the AA to refund affected customers more than GBP760,000.

The relatively small average repayment per individual (around GBP9) has not deterred the CMA from pursuing the case.

CMA Chief Executive Sarah Cardell notes that “[a]t a time when people are watching every pound, dripped fees can tip the balance” and emphasizes the importance (and cost) of learning to drive. The case is a direct example of the CMA “taking particular care to prevent harm in areas of essential spend” as pledged in its recently published 2026/27 annual plan.

3. Consequences may stretch beyond the headline fine

The burden of managing the customer refunds customers falls squarely on the AA. The driving schools will notify affected individuals that they will receive an automatic refund on their payment card or, failing that, a cheque. The CMA will monitor the progress of the refund process, requiring the AA to report to it over the coming year.

The time and resources the AA will need to carry out this exercise for over 80,000 customers is likely to be substantial. It shows how, in practical terms, the impact of a consumer law breach can be much wider than any top-level fine payable to the CMA.

4. Cooperating with the authority can bring substantial benefits

The AA settled the case with the CMA, having “engaged constructively throughout the investigation and moved quickly to address the CMA’s concerns.” The AA admitted to breaching the rules and committed not to appeal the CMA’s decision.

As a result, the AA received the maximum 40% reduction on its fine (to GBP4.2m from GBP7m).

With the probe concluding just five months after it was launched, the case clearly illustrates the timing advantages of the settlement process.

Companies facing CMA enforcement action should consider the financial and procedural benefits of cooperation when developing their response strategy, weighing these against the requirement to admit an infringement and waive appeal rights.

On a related note, they should also bear in mind the potentially severe consequences of not complying with the CMA’s investigative powers. This is the case even where a firm is not alleged to have breached consumer law. In February, the CMA fined a firm GBP473,000 for failing to respond to information notices.

5. Expect more enforcement action

The investigation into the AA’s driving schools was among a suite of eight probes opened in November 2025 in what the CMA described as a “major consumer protection drive” focused on drip pricing and other online pricing tactics. At the same time, the authority issued advisory letters to 100 firms and published new guidance on price transparency.

March 2026 saw the launch of further investigations: five targeting suspected fake and misleading online reviews and another looking into early cancellation fees.

So far, only the AA case has concluded. All eyes are now on the progress of the remaining investigations, as well as the potential opening of new cases in line with the CMA’s priorities. Further use of advisory letters is also possible, with the CMA reporting significant behavioral changes in response to previous such “soft” enforcement efforts.

We will keep you updated as developments unfold.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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