ASA says resale advert ruling ‘sets a precedent’
The UK’s Advertising Standards Authority (ASA) has told IQ its recent ruling against Viagogo has “set a precedent” for secondary ticketing websites.
Last month, the watchdog upheld a complaint from anti-touting campaign group FanFair Alliance that the resale platform had misled consumers in two advertorials published on the NME website in 2023. The paid-for ads were entitled “The best gigs to see this summer at Hyde Park” and “A beginners guide to getting Taylor Swift ‘Eras’ tour tickets. How to avoid the scammers and secure tickets.”
FanFair Alliance complained to the ASA, saying it understood the resale of tickets through resale websites like Viagogo was prohibited by the events listed.
Viagogo hit back, arguing it simply stated that tickets for the events were legitimately available on its marketplace and believed there was nothing in the ads which implied it was an official primary ticketing outlet. But the ASA rejected its argument and said the adverts must not appear again in the form complained of.
Speaking to IQ, the ASA’s Freddie Alcock says the case was relatively straightforward.
“The ruling is to protect consumers, ultimately, but also set a precedent going forward that you can’t omit information around the sale of these tickets”
“The reason they were misleading is because both events quite clearly stated in their terms and conditions that tickets bought on secondary ticketing platforms wouldn’t be valid,” he says. “We operate what we call ‘reverse burden of proof’, in that it’s on the advertiser to prove why something isn’t misleading, or to substantiate a claim they made – and Viagogo weren’t able to provide what we felt was substantial evidence that neither ads misled.
“The ruling is to protect consumers, ultimately, but also set a precedent going forward that you can’t omit information around the sale of these tickets. And to be fair to Viagogo, they have complied with it and removed both advertorials.”
Viagogo said it was “disappointed” by the ASA’s ruling, insisting it is “a safe, secure and regulated global online marketplace, and we are fully compliant with the law in all markets in which we operate”.
“We exist to get fans into live events and oppose anti-consumer actions taken by event organisers to restrict purchasing and resale options in an attempt to control the market. These measures ultimately harm fans by limiting choice, flexibility, and access.”
The company told the ASA that less than 1% of customers were denied entry to events after having purchased a ticket on its platform, and operated a guarantee so that if a customer was not admitted they would be entitled to a refund. But Alcock says that was not relevant to the complaint.
“It’s on our radar that a lot of events now say that resale tickets are only valid through a fan-to-fan exchange”
“That’s irrelevant to the problem here,” he says. “The problem here is that it does clearly misleadingly imply that tickets are valid. And [Viagogo’s] response, to be fair, was ‘Okay, we disagree, but we respect the ASA and its view.’
“We understand that [secondary ticketing] companies are allowed to operate – everyone has their views on that and it’s not for us to talk about. All that we’re concerned about is that, when they do advertise, they make sure that they don’t omit any information that could be considered important for the consumer to know upfront.”
Alcock says the regulator anticipates similar complaints to become more commonplace as artists increasingly seek to control where tickets for their shows can be resold.
“I think this ruling preemptively speaks to that issue,” he says. “It’s on our radar that a lot of events now say that resale tickets are only valid through a fan-to-fan exchange, or whatever. So hopefully this ruling serves as a reminder.
“Our main goal here is to protect consumers. We’re very conscious of the fact that someone’s buying a ticket for one of these events, one, they’re expensive and two, they might have to travel to it and pay for a hotel. There’s a lot that goes into someone deciding to go to one of these events.”
The ASA previously took action in 2018 alongside the Competition and Markets Authority (CMA) around secondary ticket sales websites failing to properly disclose fees for tickets upfront.
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UK govt rejects CMA’s calls to tighten resale laws
The UK government has rejected the recommendations of the British competition regulator to tighten laws around online ticket touting.
In a 2021 report, the Competition and Markets Authority (CMA) proposed stronger rules to deal with illegal activity on non-price-capped secondary ticketing sites, including measures to clamp down on the bulk-buying of tickets as well as the practice of “speculative ticketing”, where sellers list tickets they don’t yet own.
Other suggestions included ensuring platforms are fully responsible for incorrect information about tickets that are listed for sale on their websites, and a new system of licensing for platforms that sell secondary tickets that would enable an authority to act quickly and issue sanctions.
However, in the government’s response, business secretary Kevin Hollinrake MP says he is “not convinced” by the need for additional legislative changes.
“I am not convinced that the additional costs that would fall on ticket buyers (as regulatory costs would be passed on) are justified by the degree of harm set out in your report,” says Hollinrake. “This is especially the case when we are already proposing to give the CMA additional administrative powers to protect consumers which the CMA could deploy in the secondary ticketing market.
“However, we propose to keep the position on maximum numbers of ticket resales under review as part of our ongoing monitoring of the legislative landscape in the ticketing market and in the light of technological, enforcement and other market developments.”
“It appears the uncapped market may still provide a service of value to some consumers”
He continues: “The government notes and agrees with the CMA recommendation that there should not be a ban on the uncapped secondary ticket market. Whilst both the way tickets are sold and used are changing and there is a growing authorised capped ticket resale market to help those who can no longer use their purchased ticket, it appears the uncapped market may still provide a service of value to some consumers.”
Hollinrake argues that is “too soon to conclude that the only way forward is further legislation focused on this market”.
“As you are aware, there are a number of improvements to other aspects of consumer law which we have now published in our response to the 2021 consultation,” he adds. “These will be our priority in the immediate future, rather than changes to the secondary ticketing regime specifically.”
“The government has effectively given bad actors a free pass to continue acquiring tickets in bulk to popular events and to engage in speculative and fraudulent selling”
Sharon Hodgson MP, chair of the APPG on ticket abuse, says the group is “struggling to understand” why the government has turned down the CMA’s recommendations.
“In August 2021, the CMA made it clear to the government that a handful of additional safeguards could help reduce the scale of unlawful online ticket touting, and better protect consumers,” says Hodgson. “Nineteen months on, and all their recommendations have been rejected. We are still struggling to understand why, and on what basis.
“Rather than improving the capacity of enforcement agencies to clamp down on malpractice, the government has effectively given bad actors a free pass to continue acquiring tickets in bulk to popular events and to engage in speculative and fraudulent selling. These individuals can make extraordinary profits at the expense of ordinary fans who are left ripped off and out of pocket.
“The UK is rightly proud of its live event industry, but an uncontrolled black market risks harming the consumer experience and wreaking untold damage on the sector overall.”
“The experiences of consumers appear to have been overlooked entirely”
Adam Webb, campaign manager of UK-based campaign against industrial-scale online ticket touting FanFair Alliance, shares similar sentiments.
“In August 2021, the Competition & Markets Authority published a series of common sense recommendations to the government that aimed to further protect consumers from being ripped off by unscrupulous ticket touts and parasitical ticket resale sites,” he says. “These included new measures to clamp down on the unlawful bulk-buying of tickets and large-scale speculative fraud, where rogue traders list tickets for sale that they do not possess. Research by FanFair Alliance has shown these problems remain rampant on certain secondary ticketing platforms.
“Nineteen months down the line, and, despite overwhelming evidence of continuing bad practice, the government has today comprehensively rejected the CMA’s advice – without, we believe, consulting with experts, campaigners or the live music industry.
“The experiences of consumers appear to have been overlooked entirely. Although much progress has been made in recent years to tame the UK’s black market for tickets, FanFair Alliance shares the views of the CMA that further action is still required to tackle these evident and ongoing problems with online secondary ticketing.”
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StubHub to wind-up San Fran and Shanghai offices
StubHub has revealed plans to close its San Fransisco and Shanghai offices by the end of the year, and lay off the majority of employees based in each location.
According to CEO Eric Baker, the decision comes as the ticket resale platform looks to optimise and streamline its operations following Viagogo’s takeover of the company.
Baker says that the business will focus on building its new offices in New York and Los Angeles and using these locations as key hubs for in-person work.
StubHub announced the news via a post on LinkedIn, which included a copy of the letter that Baker sent to employees.
The CEO wrote: “This is never easy news to share. Those who are impacted by these changes have already been contacted by our People Team about their individual departure plans.
“To the team that remains, it’s growth time”
“We are grateful for the contributions of these employees and wish them well as they go on to their next chapters.
“To the team that remains, it’s growth time. Moving forward, our work will focus on in-person participation in our offices around the world, which – in addition to LA and NY – will still include locations in Utah, Switzerland, Ireland and Taiwan.”
In September last year, Switzerland-headquartered Viagogo got the green light from the UK Competition and Markets Authority (CMA) to complete its takeover of StubHub.
The deal was approved after it was agreed that StubHub would sell its business outside of North America – including the UK – to investment firm Digital Fuel Capital LLC for an undisclosed sum.
Viagogo originally agreed the purchase of eBay’s ticketing division StubHub for $4.05bn in cash in February 2020.
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Viagogo sells StubHub business outside N.America
Viagogo has sold its StubHub business outside of North America – including the UK – to investment firm Digital Fuel Capital LLC for an undisclosed sum.
The sale was approved by the UK Competition and Markets Authority (CMA) and completed on 3 September, after secondary ticketing giant Viagogo was forced to sell its international business due to competition concerns.
Viagogo acquired eBay’s ticketing division StubHub for $4.05 billion in cash in February 2020.
According to the CMA, a merger between the two companies would have resulted in a substantial lessening of competition in the secondary ticketing market, leading to higher prices and limited option for fans.
“We look forward to sharing more details about the integration of the two businesses”
Viagogo assuaged competition concerns by proposing the “divestment to an upfront buyer of StubHub’s European and certain other international legal entities”.
The sale of StubHub International to Digital Fuel Capital now brings the merger investigation to a close, says the CMA.
The Massachusetts-based investment firm will add StubHub International to its portfolio which consists of Artifact Uprising, Boutique Brands, BuyAutoParts, Guild Brands, National Tree Company, Outdoor Adventure Brands, Renovation Brands, RugsUSA, and Seattle Coffee Gear.
“We appreciate the CMA’s role in bringing the merger to this conclusion, and we look forward to sharing more details about the integration of the two businesses with our loyal customers and partners very soon,” says Cris Miller, VP of business development, Viagogo.
“Viagogo is a website with a long and storied history of breaking the law”
“As the live events industry emerges from the coronavirus pandemic, robust competition in the ticketing market is needed more than ever and Viagogo will continue to take its essential role in the live events industry very seriously. Viagogo and StubHub will always remain committed to working with regulators, while providing safe and secure platforms for people to buy and sell tickets to events all over the world.”
In 2021 so far, Viagogo has been investigated for violating laws in countries including Austria, Italy and Australia.
Adam Webb, campaign manager at FanFair Alliance, an anti-touting campaign group, says: “Good luck to Digital Fuel Capital. For their sake, I hope they didn’t pay very much.
“Viagogo is a website with a long and storied history of breaking the law and that’s dominated by large-scale touts and non-existent tickets.”
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UK’s CMA calls for stronger controls on resale sites
As live events return in the UK, the British competition regulator has proposed stronger rules to deal with illegal activity on non-price-capped secondary ticketing sites such as Viagogo and StubHub.
While laws exist to prevent the bulk-buying of tickets to resell at a profit, the speculative resale of tickets which the seller doesn’t yet own and the advertising of tickets using incorrect information, “swift and effective action by authorities is not possible under the current law”, says the Competition and Markets Authority (CMA), which has outlined its recommendations in a new report, released this morning (16 August).
Among the measures the CMA is calling for are:
- A ban on platforms allowing resellers to sell more tickets for an event than they can legally buy from the primary market
- Ensuring platforms are fully responsible for incorrect information about tickets that are listed for sale on their websites
- A new system of licensing for platforms that sell secondary tickets that would enable an authority to act quickly and issue sanctions such as taking down websites, withdrawing a business’s right to operate in the sector, and the imposition of substantial fines
George Lusty, the CMA’s senior director for consumer protection, comments: “Over recent years we have taken strong action to protect people buying tickets from resellers online, and the secondary ticket websites are now worlds apart from those we saw before the CMA took action.
“If adopted, these proposals will help prevent people getting ripped off by unscrupulous resellers online”
“While it is clear that concerns about the sector remain, there are limits to what the CMA and other enforcers can do with their current powers. With live music and sporting events starting back up we want the government to take action to strengthen the current laws and introduce a licensing regime for secondary ticketing platforms.
“If adopted, these proposals will help prevent people getting ripped off by unscrupulous resellers online, and we stand ready to help the government to implement them.”
Adam Webb, campaign manager for anti-ticket touting group FanFair Alliance, comments: “With the steady return of live music events, this is a welcome and timely report from the Competition and Markets Authority. These proposed changes to regulating the so-called secondary ticketing market could have far-reaching future benefits for music fans. We now need to fully digest the implications and viability of introducing their suggested measures.
“However, it’s equally important that we’re not distracted from the here and now. Over the course of the pandemic, FanFair Alliance has continued to send substantial evidence to the CMA detailing a range of serious and current allegations about Viagogo in particular – from systematic breaches of consumer protection law to mass-scale fraud. This has gone on for far too long.
“The CMA still has a court order hanging over this company. Given Viagogo’s wretched history of compliance and ongoing complications around their $4bn merger with StubHub, it is now even more imperative that these allegations are investigated comprehensively and, if required, decisive enforcement action taken.”
Earlier this year the CMA ordered StubHub to sell its business outside North America in order for the authority to approve its acquisition by Viagogo. The companies have indicated they will comply, with plans for StubHub outside North America to be sold to a new owner.
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Stubagogo will spin off StubHub international
Both Viagogo and StubHub have signalled they are willing to sell off the latter’s international operations in order to clear the remaining legal hurdles to the merger of the two businesses.
The UK’s Competition and Markets Authority (CMA) said earlier this week that StubHub must divest its business outside North America in order secure regulatory approval for its takeover by Switzerland-based Viagogo, which was largely complete by February 2020. Viagogo, led by StubHub founder Eric Baker, announced its intention to acquire US-based StubHub for US$4.05 billion in cash in late 2019, just before the pandemic put the brakes on live events globally.
In a statement, a spokesperson for StubHub says the company is happy for its business outside North America – which includes offices in Europe, South America and Asia, and is believed to account for around 10% of StubHub’s overall business – to continue under new ownership if it secures CMA approval for the merger. (The CMA must also vet the purchaser of the StubHub international business, as well as the terms of the acquisition.)
“StubHub is happy to have found common ground with the CMA that allows our North American business to move forward”
“StubHub is happy to have found common ground with the CMA that allows our North American business to move forward with the merger with Viagogo and our international business to move forward under new ownership,” says the spokesperson.
“We will continue to work with the CMA to implement the agreed-upon remedy. Once completed, consumers will continue to benefit from the safe and secure marketplaces provided by both businesses.”
“We are pleased to have found a remedy that is acceptable to the CMA that will allow everyone involved to move forward with clarity and certainty,” reads a similar statement from Viagogo. “Importantly, both viagogo and StubHub will continue to provide a safe and secure platform for people to buy and sell tickets to events all over the world.”
The CMA’s investigation found that the combined Viagogo-StubHub business would control a market share of more than 90% of the for-profit secondary ticketing market in the UK. The company faces stiffer competition in the US, where ticket touting is more accepted, from the likes of Ticketmaster Resale, Ticket Network, Vivid Seats and SeatGeek.
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CMA: StubHub must sell Europe, Asia, S. America biz
StubHub must sell its entire international business – including its operations in the UK, Europe, South America and Asia – for the Competition and Markets Authority (CMA) to sign off on its acquisition by Viagogo, the UK regulator announced today.
The CMA, which put the brakes on the already completed merger in October after finding it will significantly reduce competition in the secondary ticketing market, said in its final report summary, released today, that of three possible effective remedies – a full divestiture of either Viagogo or StubHub by the new company, or a partial divestiture of StubHub – the latter solution is the least intrusive for the combined business.
In addition to requiring the sale of the StubHub business outside North America, the CMA reserves the right to choose the identity of the buyer, as well as the terms of the transaction – including the right of the purchaser to use the StubHub brand for the next decade.
Should ‘Stubagogo’ not agree to the sale voluntarily “in a timely fashion”, the competition watchdog will issue a binding order, it says.
“The evidence shows that Viagogo selling StubHub’s international business will resolve our competition concerns”
The partial reversal of the merger will mean StubHub’s operations outside North America “will be independently owned and run by a separate company, with no input from Viagogo”, according to the CMA, which sought input from Viagogo/Stubhub customers, competitors and other experts, including industry professionals and consumer groups, to reach its verdict.
“The CMA has focused on ensuring competition in this sector works best for UK consumers. After examining all the options, including unwinding the merger in full, the evidence shows that Viagogo selling StubHub’s international business will resolve our competition concerns, effectively and proportionately,” says CMA inquiry group chair Stuart McIntosh.
“Creating a fully independent StubHub international business will maintain competition in the UK and help ensure that the users of these ticketing platforms don’t face higher prices or poorer quality of service.”
The CMA’s full final report will be released in the coming weeks.
Adam Webb, from campaign group FanFair Alliance, cautiously welcomes the news, explaining that the identity of the buyer will depend on whether the CMA’s decision is good for fans. “Tackling this hugely controversial $4bn merger was always going to be tough for regulators, and we welcome the CMA’s hard work during this investigation,” he comments.
“Going forward, the most pertinent question will be the identity of potential buyers”
“Going forward, the most pertinent question will be the identity of potential buyers. Practically all of StubHub’s value is in the company’s North American operation. Aside from the acquisition costs, anyone wishing to operate a successful uncapped ticket resale business in the UK would require two things: significant relationships with large-scale ticket touts to supply inventory, and deep enough pockets to outspend Viagogo on Google search advertising.
“That might be good for Google, and it might be good for ticket touts. But we need a conclusion that’s good for UK consumers, and stops them being ripped off.”
“We welcome the CMA’s decision, for which both it and the FanFair Alliance ought to be applauded,” adds Sam Shemtob, director of the Face-Value European Alliance for Ticketing (FEAT). “The requirement will help protect the live sector across Europe from a concentration of market power from the world’s largest uncapped secondary sites.
“When live events resume, reduced capacities and social distancing will likely lead to increased demand, making it more important than ever that fans can see their favourite bands at the prices intended. FEAT is working hard to make this possible, both with regulators and by developing best practice.”
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Viagogo offers to sell parts of StubHub in merger bid
Viagogo is offering to sell StubHub’s resale business outside of North America in a bid to address concerns expressed by the UK’s competition watchdog which has provisionally halted the $4 billion (£3bn) merger.
UK watchdog, the Competition and Markets Authority (CMA), recently found that the acquisition of StubHub by Viagogo will reduce competition in an “already very concentrated market”, throwing into doubt the fate of the already completed deal in the UK.
Now, Viagogo is proposing the sale of StubHub’s holding company, which operates all of its international primary and secondary businesses, including its UK operations, in a bid to address the CMA’s concerns – though the deal would see Viagogo retain StubHub’s much larger US and Canadian ticket resale business.
“There are some glaring concerns with their reported proposal, which appears to suggest a three-year lease not an outright sale”
Under the sale, the buyer of StubHub’s operations would receive customer and transaction data in the UK and beyond as well as the Spain-based Ticketbis, which was sold to StubHub in 2016 for a reported €165m.
The proposal also states that the buyer would be allowed to use the StubHub UK brand for three years, followed by a year-long “blackout” where neither the buyer nor Viagogo could use the StubHub brand in Britain.
Adam Webb, campaign manager for anti-ticket touting group FanFair Alliance, told IQ: “Viagogo is a discredited business that’s been at the heart of a major ticket mis-selling scandal, ripping off UK audiences to the tune of millions. The operators of this platform cannot be trusted. Even on initial glance, there are some glaring concerns with their reported proposal, which appears to suggest a three-year lease of StubHub UK’s business – not an outright sale. We have already raised these concerns with the CMA.”
While a Viagogo spokesperson says: “We look forward to working with the CMA to deliver a comprehensive solution which addresses their concerns and we believe this proposal would achieve that.”
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CMA: Viagogo-StubHub merger anti-competitive
The Competition and Markets Authority (CMA) has found that the acquisition of StubHub by Viagogo will reduce competition in an “already very concentrated market”, throwing into doubt the fate of the already completed deal in the UK.
The UK competition watchdog opened an in-depth, ‘phase 2’ investigation of the merger in June after finding competition concerns during its initial probe.
According to the CMA’s provisional decision, with Viagogo and StubHub now the only two companies of “material size” in the British ticket resale sector, the merged outfit would have a market share of more than 90%.
The authority is concerned the merger could lead to higher fees for fans (both selling and buying), as well as “a lower quality of service and reduced innovation in the sector”.
Stuart McIntosh, chair of the CMA inquiry group, comments: “The evidence we’ve seen so far consistently points in the same direction: that Viagogo and StubHub have a market share of more than 90% combined and compete closely with each other. We are therefore concerned that their merger could lead to secondary ticketing customers facing higher fees and lower quality services.
The CMA has suggested the sale of StubHub by Viagogo in the UK
“We’re now inviting comments on our provisional findings and possible remedies.”
Among the options floated to address the CMA’s concerns is the sale, either partial or whole, of StubHub by Viagogo on a global basis, which would leave Viagogo as an effective monopoly in many markets.
Adam Webb, campaign manager for anti-ticket touting group FanFair Alliance, says: “FanFair Alliance welcomes today’s provisional findings. Though poorly timed and focused predominantly on the US market, Viagogo’s $4.05bn acquisition of StubHub raises acute competition concerns in the UK. We are pleased the CMA has recognised this.
“Ultimately, the merger would bestow a hugely controversial business monopoly status in this country, and risk unpicking some significant progress made over recent years to clean up the secondary ticketing market. We now look forward to submitting further views to the CMA about both their findings and potential remedies.”
A Viagogo spokesperson says: “Our intention remains to provide eventgoers in the UK with the best possible service, and whilst we disagree with the provisional conclusion that the deal would reduce competition, we look forward to working with the CMA to deliver a comprehensive solution which addresses their concerns.”
The deadline for comments on the CMA’s provisional findings is 5 November 2020. Written representations can be made to [email protected].
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Viagogo proposed StubHub Europe sale to clear merger
The UK’s Competition and Markets Authority (CMA) has revealed that Viagogo offered to sell the European entities of StubHub, in a bid to gain the watchdog’s approval of its merger with the fellow secondary ticketer.
The CMA recently published documentation detailing in full its decision to refer Viagogo’s completed acquisition of StubHub for further investigation.
According to the CMA, a merger between the two companies would result in a substantial lessening of competition in the secondary ticketing market, leading to higher prices and limited option for fans.
Before the CMA reached its conclusion, Viagogo was able to offer undertakings to assuage competition concerns, proposing the “divestment to an upfront buyer of StubHub’s European and certain other international legal entities”.
Although the CMA notes it “generally prefers structural remedies, such as divestiture, over behavioural remedies”, the watchdog states that the proposed undertaking “does not offer a clear-cut solution to competition concerns”.
The watchdog claims “the scope” of the proposed undertaking “may not be appropriately configured to allow a purchaser to operate as an effective competitor in the UK market”, as the sale would require a carve-out from the global StubHub business, rather than comprising the divestment of a standalone business, leading to difficulties in implementation and re-platforming for the buyer.
Viagogo proposed “divestment to an upfront buyer of StubHub’s European and certain other international legal entities”
“The CMA considers that there is a significant risk that the Proposed Undertaking would not restore competition to the level that would have prevailed absent the Merger and would not fully address the significant competition concerns identified in the SLC Decision without the need for further investigation,” reads the CMA document.
The documentation also included testimony from resellers indicating that many view Viagogo and StubHub as the strongest alternatives to each other, with “no credible alternatives” available following the merger.
“It’s fascinating to see the full text of the CMA’s decision, and the fact that even Viagogo’s main suppliers (ie high-volume ticket touts) are against this merger tells its own story,” comments Adam Webb, campaign manager of anti-tout group FanFair Alliance.
“The main thrust of Viagogo’s arguments, that their acquisition of StubHub would not create a monopoly in the UK, and their business is competing with both primary operators and capped consumer-friendly ticket resale services, is simply not backed up by evidence – least of all from Viagogo’s own internal documents.
“We now look forward to the CMA proceeding with a full Phase 2 investigation.”
IQ has contacted Viagogo for comment.
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