ACCC reviews deceptive travel contracts

By Michael Flux, October 24 2010
ACCC reviews deceptive travel contracts

Airline practices that hype incredibly cheap fares, while using an asterisk to conceal additional fees and charges, are currently under government investigation.

The Australian Competition and Consumer Commission is looking to crack down on unfair or deceptive behaviour in advertising and contracts. They’ve concluded the biggest perpetrators of the technique to be telecommunications, gymnasiums, airlines and car hire companies.

Some of the airline terms under scrutiny will be familiar to many once-naïve travellers. They include hidden charges and penalties for transactions, costs for rescheduling or cancelling flights, holding customer information for other purposes, and limiting the time in which customers can make a claim for damages.

Car hire companies also have their contracts under the ACCC microscope. Some brands appear to have hidden clauses allowing credit cards to be debited for damages weeks after the vehicle has been used, restrictions on the use of the vehicle, and insurance issues that aren’t fully disclosed. Most of these terms remain a mystery to those who decide not to read a long, confusing contract that contradicts the impression they were given.

ACCC chairman Graeme Samuel tells The Sydney Morning Herald, “We’re basically saying to the airlines: ‘Take a good close look at these contracts, you may need to change them'”.
“Customers can be lured into an arrangement where they don’t know the totality of what they’re being asked to pay”, says Samuel. He claims the ACCC has been swamped by complaints from consumers regarding hidden terms, costs and charges.

The ACCC says car hire and travel companies were put on notice last year for the same behaviour.

Samuel reveals that “a large number” of contracts were analysed in the latest crackdown. Any punishments that will be put in place, or particular companies at fault, remain unknown at this stage.

[Sydney Morning Herald]

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