Gold’s Gym UK is being  investigated about hidden online costs by the UK's Competition and Markets Authority (CMA) using new powers under the Digital Markets, Competition and Consumers Act 2024 (DMCC Act 2024). 

The CMA says at this stage, it should not be assumed that Gold’s Gym (UK) Limited has infringed consumer protection law and no finding has been made. Gold’s Gym brand owner, RSG Group, told HCM it does not intend to comment at this time and HCM understands that Gold’s Gym has purely been targeted as a typical representative of the overall sector.

Seven other companies have been targeted from across other key markets and advisory letters sent to 100 more firms.

These investigations launched by the CMA are the first enforcement cases opened using its new powers under the Digital Markets, Competition and Consumers Act 2024 (DMCC Act 2024), which enables it to decide whether consumer laws have been broken, rather than having to go through the courts. 

If the CMA finds there has been an infringement of the law, it can order businesses to pay compensation to affected customers, as well as fining companies up to 10 per cent of their global turnover.

The CMA will now engage with Gold’s Gym UK – which has four sites in London and Essex – and gather evidence to consider whether the CMA thinks the company has infringed consumer protection law.

The investigation will centre around the presentation of a one-off joining fee for an annual membership and whether the way this has been presented breaks the law – it is introduced part way through the sign-up process and not included in advertised membership costs.

Sarah Cardell, chief executive of the CMA, fired a warning shot to businesses, saying: “At a time when household budgets are under constant pressure and we’re all hunting for the best deal possible, it’s crucial that people are able to shop online with confidence, knowing that the price they see is the price they’ll pay.

“It’s our job to protect consumers from misleading prices and illegal pressure selling and today marks an important milestone as we take action across the economy to make sure businesses comply.”

Katrina Anderson, principal associate at national law firm, Mills and Reeve, says: “At a time when building trust and consumer loyalty is key to business success, you can’t afford to be on the wrong side of this legislation. It’s a hyper-competitive trading environment and of course businesses need to be commercial. But to be truly commercial, you need to prioritise compliance.”

Find our more in our briefing feature by Katrina Anderson in the next edition of HCM. Click here to sign up for your personal digital copy with our compliments.