The Competition and Consumer Protection Commission of the Republic of Armenia has fined an online taxi service company for misleading consumers.

Based on citizens’ complaints, the Commission initiated proceedings against an online taxi service company (hereinafter referred to as the Company). Citizens reported that the price displayed in advance on the company's application often  increased by the end of the trip when payment was made by non-cash methods, without proper notification. In some cases, the amount charged exceeded the original fair, including due to route changes or surcharges applied for non-cash payments.

Within the framework of the initiated proceedings, the Company argued that it does not provide passenger transportation services itself, but merely ensures the technical operation of the application, facilitating communication between drivers and passengers. Concerning the 2% surcharge for non-cash payments, the Company stated that it is a bank commission and, like a tip, was not considered part of the trip fare.

The Commission found out that:

• The taxi application is managed by the Company, and the 'Terms and Conditions' available on the Website for electronic applicants are supervised by the governing body, which is the Company.

• When placing an order in the application, there was no indication that the displayed price was preliminary and subject to change.

• At the time the proceedings were initiated, such information was also absent from the “Terms and Conditions” section of the service.

• The application failed to properly notify the passengers in advance that a surcharge would be applied in the case of non-cash payment.

As a result of the proceedings, the Commission concluded that the Company's practice of charging an additional mandatory amount beyond the fare indicated in the "Order Details" section of its application, as well as its failure to duly inform consumers in advance and  in a clear manner about the possibility of changes to the the displayed fare due to route changes, constitutes an act of  misleading the public.

Consequently, the Company was instructed to correct the violations, and was imposed with a significant administrative fine. At the same time, the Commission took into account that the Company had taken certain, incomplete measures to eliminate the consequences of the violations, which was considered a mitigating factor when determining the penalty.