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Highlights
- Misleading "Cheap Flights" Ads: The ACCC alleges Webjet advertised low flight prices across its platforms, including its website, mobile app, social media, and promotional emails, without prominently disclosing mandatory fees.
- Booking Failures: In 382 instances, Webjet reportedly confirmed flight bookings, accepted payments, but later informed customers the bookings were unfulfilled.
- Consumer Transparency: ACCC Chair Gina Cass-Gottlieb emphasized the importance of clear pricing during economic pressures, criticizing Webjet’s use of fine print and hidden disclosures for misrepresenting the total cost of travel.
The Australian Competition and Consumer Commission (ACCC) has initiated legal proceedings against online travel company Webjet, alleging violations of Australian Consumer Law. The case, brought to the Federal Court, revolves around claims that Webjet misled consumers about flight prices and failed to adequately disclose additional fees for up to five years, ending in November 2023.
Allegations and Impacts
The ACCC claims that Webjet’s marketing strategies included statements such as “flights from $X,” which lured customers with what appeared to be low fares. However, the advertised prices often excluded additional mandatory charges. According to the ACCC, fee disclosures were typically relegated to fine print at the bottom of screens or emails, making them insufficiently visible.
The ACCC also highlighted instances of unfulfilled bookings. Despite sending confirmation emails and displaying booking confirmations online, Webjet allegedly failed to secure flights for at least 382 customers. These consumers were later asked to pay additional fees or offered refunds, disrupting travel plans and eroding trust.
Cass-Gottlieb remarked, “A statement about the lowest price must be a true minimum price, not a price subject to further fees and charges before a booking can be made.”
Webjet Responds
In a statement to the ASX, Webjet acknowledged the allegations and expressed its commitment to Australian Consumer Law compliance. The company stated it had already taken measures to improve fee transparency and reiterated its focus on building trust with customers.
“Webjet Marketing takes compliance with Australian Consumer Law extremely seriously and has always prided itself on its high levels of trust with all stakeholders, especially our customers,” the statement read. It also noted receiving few complaints about fee disclosures.
ACCC’s Objectives
The ACCC is pursuing financial penalties and greater transparency in the travel booking sector. While the financial impact on Webjet remains uncertain, the case highlights the watchdog’s focus on protecting consumers from deceptive practices in economically challenging times.
What’s Next?
The Federal Court will hear the case, with the ACCC aiming to secure penalties and potentially set a precedent for stricter transparency in travel advertising. Meanwhile, Webjet’s compliance measures and cooperation with the regulator will likely be scrutinized as the proceedings unfold.
