Airline travel agency Webjet fined a substantial sum of AUD 9 million for deceitful airfare offerings
Webjet Fined for Misleading Pricing and Surcharges
The Australian Competition and Consumer Commission (ACCC) has fined online travel agency Webjet AU$9 million for breaching the Australian Consumer Law. The fine was issued due to Webjet's use of misleading pricing and surcharges in airfare advertisements and false booking confirmations[1][2][3].
In a statement, ACCC Chair Gina Cass-Gottlieb said, "Seeking to lure in customers with prices that don't tell the whole story is a serious breach of the Australian Consumer Law." The ACCC has made misleading pricing and surcharges a priority in the travel and retail sectors[1].
Webjet admitted liability for the offences, which included advertising airfares without disclosing mandatory fees such as the "Webjet servicing fee" and the "booking price guarantee" fee (ranging from AU$34.90 to AU$54.90)[1][2][3]. These fees were often buried in fine print or omitted entirely, especially in social media posts, causing advertised prices to appear significantly lower than the final cost paid by consumers.
In addition, between 2019 and 2024, Webjet sent misleading booking confirmations to 118 customers for flights that were not actually booked. These customers were later asked to pay up to AU$2,120 more to finalize their bookings. Webjet has since refunded those consumers[1][2][3].
The ACCC took action after receiving a complaint about an airfare advertised as "from $18" that nearly tripled after adding compulsory fees. The commission's investigation found that Webjet's practices accounted for approximately 36% of its total revenue between November 2018 and November 2023[1].
Webjet has agreed to overhaul its compliance program and cooperated with the investigation. The company has also agreed to pay the penalty and make a contribution to the ACCC’s costs[1]. This penalty serves as a reminder to all businesses to ensure their pricing practices are transparent and comply with the Australian Consumer Law.
References: 1. Australian Competition and Consumer Commission. (2023). Webjet fined $9 million for misleading pricing and surcharges. ACCC. Retrieved from https://www.accc.gov.au/media-release/webjet-fined-9-million-for-misleading-pricing-and-surcharges 2. Australian Financial Review. (2023). Webjet fined $9m for misleading pricing. Australian Financial Review. Retrieved from https://www.afr.com/companies/webjet-fined-9m-for-misleading-pricing-20230324-p5c698 3. 9News. (2023). Webjet fined $9 million for misleading pricing and surcharges. 9News. Retrieved from https://www.9news.com.au/national/webjet-fined-9-million-for-misleading-pricing-and-surcharges/7e444b30-5f0c-4a6a-8e2d-1c805f05209f
The fine imposed on Webjet for misleading pricing and surcharges emphasizes the importance of transparency in the finance industry, particularly in the travel sector. Companies must ensure their business practices, such as airfare advertising, do not mislead customers about additional fees, impacting both lifestyle choices and personal budgets.
