The Federal Court has today ordered online travel agency Webjet to pay $9 million in penalties for making false or misleading statements about the price of flights and booking confirmations, after a case run by the ACCC.
Webjet admitted that between 2018 and 2023 it made false or misleading statements when it advertised airfares that excluded compulsory fees. The statements were made on its website, and in promotional emails and social media posts.
Webjet also admitted that between 2019 and 2024 it provided false or misleading booking confirmations to 118 consumers for flight bookings which had not actually been confirmed. Webjet later asked for additional payments, of up to $2,120, from consumers to complete the booking. Webjet has refunded these consumers.
The ACCC commenced its investigation after a consumer complained about an airfare advertised as "from $18", which cost almost three times that price after Webjet added its compulsory fees.
"We took this case because we considered that Webjet used misleading pricing by excluding or not adequately disclosing compulsory fees in its ads," 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 Webjet fees comprised the "Webjet servicing fee" and "booking price guarantee" fee which ranged from $34.90 to $54.90 per booking, depending on whether the flights were domestic, to New Zealand and the Pacific, or other international destinations.
While Webjet's website, app and most emails contained information about the additional fees, some users had to scroll to the fine print near the bottom of the screen to see them. In its social media posts, Webjet didn't disclose the additional fees at all.
"Retailers must ensure their advertised prices are accurate. They should clearly disclose additional fees and charges," Ms Cass-Gottlieb said.
The Webjet fees represented 36 per cent of Webjet's total revenue in the period from 1 November 2018 to 13 November 2023.
Webjet co-operated with the ACCC, admitted liability and agreed to make joint submissions to the Court about orders, including the penalty. The Court also made declarations and other orders proposed, including that Webjet review its compliance program and pay a contribution to the ACCC's costs.
Example of social media post showing flights advertised as "from $xx"
Example of website showing promoted prices for airfares advertised as "from $xx"
Background
Webjet is a wholly owned subsidiary of Webjet Group Limited (a publicly listed company on the ASX) and operates the online travel agent arm of the company, manages the Webjet brand, and carries out marketing operations.
Webjet's app and website offers travel-related products and services to consumers, including from different airlines. Consumers can compare and book flights, hotels, car rental and travel insurance through the Webjet website and app.
On 28 November 2024, the ACCC instituted proceedings against Webjet Marketing Pty Ltd in the Federal Court.
Misleading surcharging practices and other add-on costs, and consumer and fair trading concerns in the supermarket and retail sectors, with a focus on misleading pricing practices, are current ACCC priorities.
