Advertisement

Viagogo to pay $7 million for misleading consumers

Ticket reseller Viagogo AG was yesterday ordered by the Federal Court to pay a penalty of $7 million for breaching the Australian Consumer Law.

Australian Competition and Consumer Commission (ACCC) brought proceedings against Viagogo for making false or misleading representations when reselling tickets for live music and sports events.

In 2019 the court found that Viagogo made false or misleading representations to consumers that it was the ‘official’ seller of tickets to particular events, that certain tickets were scarce, and that consumers could purchase tickets for a particular price when this was not the case because significant fees, such as a 27.6% booking fee, were not disclosed until late in the booking process.

From 1 May 2017 to 26 June 2017, Viagogo’s website attracted consumers by advertising a headline price which did not specify a total price for tickets. It also failed to adequately disclose to consumers that it was not a primary ticket seller.

Examples included a ticket for the Book of Mormon advertised at $135 but which was sold for $177.45 including booking and handling fees, as well as Ashes cricket tickets advertised at $330.15, but sold for $426.81 after fees were added.

In Australian Competition and Consumer Commission v viagogo AG (No.3) [2020] FCA 1423 Justice Stephen Burley handed down a decision yesterday in which he imposed the penalty of $7 million, describing the misrepresentations as serious or very serious, and saying that he considered the conduct demonstrated a level of deliberateness. He described one category of representations as having been made on “an industrial scale”.

Viagogo’s responses were described by the judge as giving it “the appearance of being a company that is indifferent to the interests of Australian consumers and which prefers to elevate its own profit motives above those interests, even when on notice of the potential for harm being done”.

ACCC Chair Rod Sims said: “Viagogo’s business practices were unacceptable. Viagogo misled thousands of consumers into buying tickets at inflated prices when they created a false sense of urgency by suggesting tickets were scarce and when they advertised tickets at a lower price by not including unavoidable fees.”

The court also observed the need for general and specific deterrence in this matter, particularly to make it clear to corporations which conduct internet-based operations in Australia that they are subject to the Australian Consumer Law (ACL).

“Today’s $7m penalty sends a strong signal to businesses like Viagogo conducting business in Australia that they cannot get away with profiting from misleading Australian consumers about the price of the tickets they are selling, or other misleading conduct,” Mr Sims said.

The Federal Court ordered an injunction against Viagogo AG, to reinforce the need for adherence to the ACL. The court also ordered the company to conduct a compliance program and pay the ACCC’s costs.

Share this article

Leave a Reply

Your email address will not be published.

Search by keyword