- Cineplex (TSX:CGX) says it will appeal a decision by the Competition Tribunal, which fined the company C$38.9 million for engaging in deceptive marketing by charging a C$1.50 online booking fee
- The movie theatre company believes the fee is displayed in “a clear and prominent manner,” according to a statement released Monday night
- Cineplex is a consumer discretionary company focused on media, film entertainment and content, and amusement and leisure
- Cineplex stock has added 25.57 per cent year-over-year, but has given back 54.83 per cent since 2019
Cineplex (TSX:CGX) says it will appeal a decision by the Competition Tribunal, which fined the movie theatre company C$38.9 million for engaging in deceptive marketing by charging a C$1.50 online booking fee.
The decision, according to Monday’s news release, follows an application by the Competition Bureau in May 2023 relating the fee to deep pricing, or the practice of offering low prices to attract customers, only to add mandatory fees later in the purchasing process.
The Tribunal sided with the watchdog and ordered Cineplex to refrain from the practice for the next 10 years, as well as pay a C$38.9 million fine equivalent to the revenue it collected since introducing the online booking fee in June 2022 until December 2023.
Cineplex released a statement Monday night vowing to appeal the Tribunal’s decision, noting that “the online booking fee is an optional, value-added service,” presented in “a clear and prominent manner,” that “provides moviegoers with the confidence of knowing they have a ticket and an exact seat location before they arrive at a theatre.”
“To clarify,” the statement continued, “this ruling has no impact on the continuation of offering this value-added service to consumers. 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 letter of the law.”
About Cineplex
Cineplex is a consumer discretionary company focused on media, film entertainment and content, and amusement and leisure. It operates 169 movie theatres and location-based entertainment venues across Canada.
Cineplex stock (TSX:CGX) last traded at C$10.95 per share. The stock has added 25.57 per cent year-over-year, but has given back 54.83 per cent since 2019.
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(Top photo of a Cineplex corporate office in Toronto: Yonge and St. Clair BIA)