Motorists will benefit from better car rental terms at home and abroad following a Europe-wide review of the sector.

The Competition and Markets Authority (CMA) has led a Europe-wide project, facilitated by the European Commission and involving member state consumer protection authorities, which has resulted in five leading EU car rental companies committing to improving the way they deal with their customers.

The companies – Avis Budget, Enterprise Rent-a-Car, Europcar, Sixt and Hertz, which in total represent around two thirds of the UK and EU markets – have agreed to introduce the following improvements over the next six months:

• improved transparency when making a website booking or reservation giving consumers more of the key information they need to shop around for the best deal for them;

• better information at the booking stage about optional waiver and insurance products;

• more upfront information about pre- and post-rental vehicle inspection processes;

• improved notification of, and dispute processes for, any charges for damage.

Each company has committed to make these bespoke changes depending on the standard of their existing practices, with each committing to an overall better package of practices that includes one or more of the above.

Nisha Arora, CMA senior director, said: “We welcome the improvements made by the leading EU car rental companies to ensure that consumers are given clearer information upfront about their rental. These changes go a long way to ensuring that consumers know exactly what they are getting when they rent a car.

“The CMA, together with the European Commission and our EU counterparts have worked constructively with the leading EU car rental companies to reach agreements on revised practices that will benefit motorists who rent vehicles in the UK and abroad. The improvements by these five businesses now set a benchmark for the rest of the industry to follow.”

In the UK, the CMA has worked closely with the trade association the British Vehicle Rental and Leasing Association (BVRLA). Following a review of its UK code of conduct, significant improvements similar to those adopted by the main car hire businesses have been adopted into the code to which companies representing the vast majority of the UK car rental fleet are signatories. The revised code will be launched at the beginning of 2016.

At a European level the CMA, European Commission and enforcement authorities in other EU member states have worked with Leaseurope, the umbrella body for the European car rental trade associations. Leaseurope has already adopted the general principles underlying the agreed improvements into its code of conduct, with further guidance due to be published in the next few months.

The CMA has produced a 60-second summary providing advice for consumers on what to look out for when renting a car.