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Independent News For The Australian Public Service
Edition Number 397. Updated Tuesday, 18 February 2014

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PC inquiry backs Access Regime

The consumer watchdog has warned it is likely to take legal action against companies that use so-called "drip pricing" to boost prices.

The Australian Competition and Consumer Commission (ACCC) defines drip pricing as the "incremental disclosure of fees and charges over an online booking process".

The ACCC is particularly concerned about the travel industry and event tickets booking agencies, where charges are added as the consumer moves through the stages of the booking.

Chairman of the ACCC, Rod Sims, said the practice was detrimental to competition and consumers.

"Drip pricing is where the price you end up paying is very different from the price that enticed you to begin the transaction," he told the ABC.

Promotes competition

"We will probably be taking action in the Federal Court reasonably soon, dealing with some of this behaviour," he said.

"I'm afraid I can't tell you which companies, but we are at an advanced stage of investigating some of this behaviour."

Mr Sims spoke on the issue in his 2014 Compliance and Enforcement Policy speech at the Committee for Economic Development of Australia (CEDA) conference in Sydney on 21 February 2014.

Mr Sims said the ACCC has set nine consumer protection priorities for 2014.

They include door-to-door selling and telemarketing for the telecommunications and energy sectors, which focus on savings representations, also referred to as "discounts off what"?

Mr Sims said the ACCC will also look at competition and consumer issues in highly concentrated sectors, in particular in the supermarket and fuel sectors.

It will also look at scams that rely on building deceptive relationships, and which cause severe and widespread consumer or small business detriment.

Complexity and unfairness in consumer or small business contracts will also be examined, as will credence claims, particularly those with the potential to adversely impact the competitive process and small businesses.

Misleading carbon pricing representations will also be in the spotlight as will the ACL consumer guarantees regime, particularly in the context of the sale of extended warranties.

Mr Sims said consumer protection issues were impacting on Indigenous consumers.

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