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ACCC brings proceedings against Airbnb
The competition regulator is instituting proceedings in the Federal Court against Airbnb for allegedly misleading consumers into believing prices for Australian accommodation were in Australian dollars when in fact, for many consumers, prices were in US dollars.
Jerome Doraisamy
The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against Airbnb, Inc. and Airbnb Ireland UC (together, Airbnb), alleging that – between at least January 2018 and August 2021 – the company “made false or misleading representations to thousands of Australian consumers”.
There were, at least, “some occasions” where Airbnb referred to the price as “USD” in small font on the last page of the booking process, but “this happened only after the platform had already displayed numerous dollar (‘$’) amounts on earlier pages, without nearby reference to US dollars, and after the consumer had clicked to ‘reserve’ their accommodation”, the regulator said in a statement.
The ACCC further alleges that Airbnb engaged in misleading and deceptive conduct by telling thousands of consumers, who complained about being charged more than the displayed price, “that it had displayed prices in US dollars because the user had selected this currency, when this was often not the case”.
ACCC chair Gina Cass-Gottlieb said: “We allege that Airbnb’s misleading conduct meant that consumers were deprived of the opportunity to make an informed choice about whether, and at what price, to book their holiday accommodation on the Airbnb platform.
“In addition to paying higher prices than expected, some consumers who were charged in US dollars also found themselves further out of pocket through currency conversion fees charged by their credit card provider.”
In the period between January 2018 and August 2021, the average Australian dollar to US dollar exchange rate was about US$0.72. At this rate, the regulator noted, an Australian consumer who thought they were paying $500 for their accommodation booking would have actually paid almost $700, before any foreign currency conversion fees.
“Airbnb did not compensate many consumers who complained about this conduct, and so we will be arguing that the court should order Airbnb to compensate people who were misled about the price of their accommodation,” Ms Cass-Gottlieb said.
“Despite thousands of consumers complaining to Airbnb about the way prices were displayed, Airbnb didn’t amend its booking platform until after the ACCC raised the issue.”
The ACCC said that it expects all businesses to regularly review and appropriately address issues revealed by the consumer complaints they are receiving.
“By taking this action, we are stating very clearly that digital platforms like Airbnb need to ensure the accuracy of all statements that may affect consumers’ purchasing decisions,” Ms Cass-Gottlieb said.
The ACCC will be seeking declarations, injunctions, pecuniary penalties, orders for the compensation for affected consumers, costs, and other orders.
Airbnb Australia Pty Ltd is primarily a marketing entity responsible for promoting Airbnb in Australia and is not a party to the ACCC’s proceeding.
In its statement, the ACCC pointed out that, in 2015, Airbnb Ireland provided the ACCC with a court-enforceable undertaking in response to different concerns about the way prices were displayed on its website and apps.
“While there is no suggestion that Airbnb Ireland breached the undertaking, the undertaking also related to alleged false and misleading representations regarding the price of its products,” the regulator noted.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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