New law to fight travel rip-offs: the Australian Consumer Law benefits travellers

By danwarne, January 20 2011
New law to fight travel rip-offs: the Australian Consumer Law benefits travellers

Australians now have stronger protection against unfair airline, travel agent and hire car rules, under a new law in effect since the beginning of January.

The new Australian Consumer Law (ACL) replaces the old Trade Practices Act entirely and covers all states and territories, restricting companies from many sorts of unfair behaviour.

For example, the top issue tackled by the law is unfair conditions in "standard forms of agreement" -- documents that can run to hundreds of pages long and are kept in filing cabinets or buried in fine print links on websites by companies.

Consumers are hoodwinked into agreeing to these unreadably long contracts every time they sign a contract that says something like "I also agree to XYZ company's SFOA".

The new law will be of particular benefit in situations where a consumer feels they have been unfairly treated by an airline, car rental company, travel agent, telco or other company that relies heavily on terms and conditions.

It will benefit people like Australian Business Traveller reader Troy C, who was slugged $2,000 in cancellation fees by travel agent Best Flights after he was unable to take a flight to Europe due to the floods in Brisbane.

Although cancellation fees are standard in air travel, the unusual aspect was that the airline he'd booked through had agreed to waive all standard cancellation fees as a compassionate measure. The fees were being stubbornly applied by the travel agent.

The agent had also failed to advise the reader in advance that high fees would be levied on cancellations, and attempted to rely on terms and conditions on its website -- despite the fact that the flights were booked over the phone with an operator, not through the website.

The new law bans terms and conditions that are "not reasonably necessary to protect the legitimate interests of the supplier; and it would cause financial or non-financial detriment to a consumer".

The law is also expected to help consumers with hire car agreements, baggage handling disclaimers and airline ticketing conditions.

Essentially, the fact that a consumer has signed an agreement with a company does not make every part of it binding if one of the conditions fails the Australian Consumer Law Act's fairness test.

The Australian Competition and Consumer Commission is now empowered to take class actions on behalf of consumers, too, where there are obvious cases of many consumers being forced to sign up to unfair contracts.

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