Virgin Australia and Jetstar accused of advertising false airfares
Virgin Australia and Qantas-owned Jetstar Airways have breached Australian Consumer Law for misrepresenting and making false conduct about the price of particular advertised airfares, announced the Australian federal court on Tuesday.
Australian Competition and Consumer Commission (ACCC) released the news on their website, stating that, in the case of Jetstar, the court discovered that certain advertisements uploaded on its website in 2013 and 2014 were false and misleading. The court mentioned that ACCC hasn’t established the allegations against Jetstar in relation to the advertisement uploaded in 2014.
As for Virgin Australia, the court was able to discover that airfares advertised on its mobile site in 2014 were false and had misled customers. In this case also, the court held that the ACCC had not established that the alleged misleading representations were made by Virgin on its website, nor in its promotional emails of 2014.
ACCC Chairman Rod Sims called the subject of such allegations in both the airlines’ proceedings as “drip pricing.” This is a process in which often high additional charges are levied on the advertised price fares, leaving customers to pay more than they realise and making it more difficult to compare offers.
The ACCC accused both Virgin and Jetstar of not revealing the additional booking and service fee at the initial stage but at a much later stages of the booking process. “The ACCC’s concern with drip pricing has always been to ensure that consumers are not misled and that businesses are not unfairly disadvantaged by misleading practices,” Sims said.
The commission mentioned that although they had not established all of the allegations against Jetstar and Virgin, the conduct was significantly misleading. Sims further said that after ACCC had started working on drip pricing, many airlines have started to display the pricing adjustments. “This also has a positive effect on competition, allowing consumers to easily compare and choose the best price,” Sims added.
A hearing on relief will be held on a date to be fixed by the Court.
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