The ACCC’s latest issue of the Small Business in Focus Report reveals the latest small business enquiries and complaints data. Of significance, the Report highlights that misleading and deceptive representations remain the most frequently complained about area for small businesses. Identifying and taking action against companies engaging in misleading and deceptive conduct under the Australian Consumer Law was one of the ACCC’s primary activities. The ACCC took such an action against Hillside (Australia New Media) Pty Ltd trading as Bet365 (Bet365), one of the largest online betting providers in the world.[1]

BACKGROUND

The proceeding was commenced by the ACCC in regard to Bet365’s promotional offers contained on its website. The first was conducted under the headline “$200 FREE BETS FOR NEW CUSTOMERS” (Free Bets Offer) during the period from 18 March 2013 to 30 January 2013, which the ACCC alleged conveyed the dominant message that new customers would be entitled to $200 of free bets, without limitation or restriction.

The second was conducted under the headline “$200 DEPOSIT BONUS FOR NEW CUSTOMERS*” from 30 January 2014, which was changed to “UP TO $200 DEPOSIT BONUS FOR NEW CUSTOMERS” (Deposit Bonus Offer).

THE DECISION

  1. THE FREE BETS OFFER

From 18 March 2013 to 13 January 2014, Bet365’s website contained the headline “$200 FREE BETS FOR NEW CUSTOMERS*” followed by the words “BET NOW”. However, the webpage contained no other asterisk or information to which the asterisk in the headline could refer despite the following terms and conditions applying to the offer:

  1. The customer had to pay a deposit and risk that deposit before being entitled to make any “free” bet.
  2. The customer had to risk the value of his deposit and the amount of the “free” bet three times prior to making a withdrawal. This meant that customers who made a deposit of $200 and received $200 had to gamble $1200 before being able to withdraw any money.
  3. The offer was not available for bets at odds less than 1/2 ($1.50 return for a $1 bet).
  4. The amount of the “free” bet and any winnings from any “Free Bet” were to be forfeited unless the customer risked the value of his deposit and the amount of the “free” bet three times within 90 days.
  5. The value of the “free bet” was limited by the size of the customer’s first deposit.
  6. Residents of Victoria, NSW, SA and WA were not eligible for the offers. This is because legislation in these states at the relevant time prohibited betting companies from offering inducements to consumers to open a betting account.

On 14 January 2015, Bet365 then changed the headline to include the words “*See Terms and Conditions below” and the terms and conditions of the Free Bets Offer were displayed in full at the bottom of that page.

The Court had to determine whether there was a “real rather than a remote possibility of the member of the relevant class being misled or deceived” by the advertising or, in other words, that it “had a tendency to lead persons of the relevant class into error”.  In particular, the Court had to consider whether the above conditions were sufficiently brought to the attention of the relevant class or were relegated to obscurity, such that the advertising was apt to mislead the relevant class into negotiations.

Bet365 suggested that the dominant message was not misleading or deceptive because new customers could obtain $200 of free bets. They argued that as long as the customers made a $200 deposit and used it to make bets, they could bet with money provided by the Bet365 companies rather than by themselves. Beach J held that this analysis and characterisation was artificial.

Beach J found that the Free Bets Offer and its promotion prior to 14 January 2014 involved misleading or deceptive conduct and false or misleading representations by Bet365, and it was not appropriately qualified by the terms and conditions.  None of the key conditions were displayed on the same webpage as the headline before 14 January 2014. To find the terms, the customer would have to investigate other pages. The digital pathway to the terms was somewhat complicated and problematic.   Any customer who did so would have already “been fully drawn into the marketing web by the headline offer”.   Despite the presence of the asterisk which commonly indicates that the offer is subject to conditions, the asterisk “was an orphan” as “it was not referenced to and was disconnected from the terms and conditions”. 

This disconnection between the offer and the terms was very important. This is illustrated by the contrasting situation which existed from 14 to 30 January 2014. During this time, as stated above, the webpage that contained the headline offer also included the words “*See Terms and Conditions below” immediately below the words “BET NOW”, and the terms of the offer were displayed in full on the webpage. Beach J found that, during this time, there was no misleading or deceptive conduct.

  1. THE DEPOSIT BONUS OFFER

Beach J held that Bet365 did not engage in misleading or deceptive conduct or make false statements in regard to the Deposit Bonus Offer.   The dominant message conveyed by this offer was that new customers were entitled to a deposit bonus of up to $200 for placing bets. There was nothing misleading or deceptive about this representation as new customers were able to obtain a bonus amount to bet with of up to $200 (matching their initial deposit up to $200).   Further, and in any event, it was appropriately qualified by the terms which were adequately displayed. The terms were included at the bottom of the webpage. 

TAKEAWAY LESSONS

Terms and conditions of any offer are important. Even though it was possible to obtain the promotional offer of $200 worth of free bets, the failure to prominently display the terms and conditions meant the conduct was misleading and deceptive.