Tickets for live events are generally made available for purchase at prices determined by an event organiser. However, these tickets are often bought in bulk and resold at inflated prices via online secondary ticket facilitators such as StubHub, Seatwave, Viagogo and GetMeIn. As a result, event organisers and popular artists have started working together to introduce additional restrictions in order to limit the resale of tickets at exorbitant prices. In a recent example, the Arctic Monkeys publicised a range of restrictions over tickets for a forthcoming tour which included (1) limiting the secondary ticket facilitators permitted to resell tickets to one face value partner platform and (2) requiring that all ticket holders must enter the venue at the same time as the lead buyer on the booking for that ticket.
While these restrictions may be legally permissible, it is important for all operators in the secondary ticketing market to carefully monitor developments of legislation in the area. The CRA introduces obligations on key players in this market, with the aim of increasing transparency for consumers looking to buy resold tickets.
The legal position under the CRA before 6 April 2018
On 27 May 2015 the CRA introduced a number of provisions regulating the online resale of event tickets in the UK. The key provisions cover a range of matters which include:
- the information to be provided to buyers when tickets are resold online;
- the circumstances where event organisers are permitted to either cancel tickets that are resold online or blacklist online resellers; and
- the potential penalties for non-compliance with the CRA.
Information to be provided to buyers when tickets are resold online
Section 90 CRA specifies the type of information that must be provided in a “clear and comprehensible manner” to potential buyers of tickets made available for resale online. This includes:
- information necessary to enable the buyer to identify a particular seat or standing area (e.g., whether in the stalls or a particular block);
- information on any restrictions limiting the use of the ticket to people of a particular description (e.g. if the ticket can only be used by a named individual or no under-18s are admitted);
- the face value of the ticket; and
- the details of any relationship between the reseller and event organiser or secondary facilitator.
Circumstances where event organisers are permitted to cancel tickets or blacklist online resellers
As outlined above, event organisers have a legitimate interest in ensuring that tickets to their events aren’t resold at exorbitant prices. Any financial upside from reselling the tickets does not flow through to the organiser and leads to a disenfranchised consumer base. Event organisers may therefore wish to impose specific conditions to ensure that tickets cannot be resold or that resellers of tickets be blacklisted (and prevented from buying tickets from the primary market). However, while the CRA recognises this legitimate interest, it must be balanced against fairness for consumers.
Sections 91 and 92 CRA deal with this issue by providing that, for tickets that are resold or offered for resale, a right to cancel the ticket or to blacklist the initial buyer of the ticket will not be permitted unless:
- the right is included in the original ticket terms and conditions; and
- the term was not unfair for the purposes of Part 2 of the CRA.
While guidance is limited regarding when a term may be considered to be fair under the CRA, there is guidance from the Competition & Markets Authority suggesting that a term that undermines a consumer’s right to sell what they own is at risk of being regarded as unfair. Therefore, any relevant restriction should be necessary and proportionate to the legitimate interests of the event organiser to stand the best chance of being enforceable.
Potential penalties for non-compliance
Section 93 of the CRA allows the UK trading standards authorities to impose fines of up to £5,000 on secondary sellers, event organisers and secondary ticketing facility operators for each breach of the secondary ticketing provisions.
The legal position under the CRA after 6 April 2018
On 6 April 2018 the Digital Economy Act 2017 amended the CRA to give effect to a new provision requiring that buyers must also be provided with information detailing “any unique ticket number that may help the buyer to identify the seat or standing area or its location“. However, guidance published by The Department for Business, Energy & Industrial Strategy makes clear that there is no requirement on resellers to provide a unique ticket number (UTN) where the event organiser does not provide one or where it would not help the buyer to identify the seat, standing area or location.
What does this mean for organisers, resellers and operators in the online secondary ticketing market going forwards?
Event organisers, ticket resellers and secondary ticket facilitators must carefully review the relevant legislation to ensure that the resale of tickets is compliant, transparent and ultimately fair to consumers. If organisers are looking to impose restrictions on the resale of tickets, they must take care to ensure that these restrictions are necessary and proportionate to their legitimate interests to limit the risk of exposure to a fine under the CRA.