Earlier this year, the ACCC announced ‘drip pricing’ as an enforcement priority in 2014.
On 19 June 2014, the ACCC commenced proceedings against Jetstar Airways Pty Ltd (Jetstar) and Virgin Australia Airlines Pty Ltd (Virgin), alleging that the airlines used ‘drip pricing’ in advertising that certain domestic flights were available at specific prices, when in fact those prices were only available when using certain payment methods.
Specifically, Jetstar charged an additional booking and service fee of $8.50 per passenger if payment was made by a credit card (other than a Jetstar branded credit card) or Paypal, and Virgin charged an extra $7.70 per passenger if payment was made by any credit or debit card or Paypal.
The ACCC claims that these additional fees should have been disclosed upfront and prominently with or within headline prices.
The ACCC is seeking pecuniary penalties, declarations, injunctions and corrective advertising against both airlines and scheduling conferences are listed in early August.