Online accommodation marketplace Airbnb has been hit with a lawsuit by Australian authorities for alleged misleading pricing practices.
In a new statement, the Australian Competition and Consumer Commission (ACCC) alleged that between January 2018 and August 2021, Airbnb did not clarify that the prices displayed on its website.
In the filing, it states that Australian accommodations were in U.S. dollars, causing consumers to pay more than they believed.
“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,” ACCC Chair Gina Cass-Gottlieb said.
“In addition to paying higher prices than expected, some consumers who were charged in U.S. dollars also found themselves further out of pocket through currency conversion fees charged by their credit card provider.”
The ACCC gave an example that during that period, if an Australian customer selected a $500 (US$358) booking on Airbnb, they would actually have to pay nearly $700.
When thousands of customers complained to Airbnb about the pricing practices, the company is alleged to have falsely replied that many of them had chosen the U.S. currency for the transactions.
Cass-Gottlieb said that despite the complaints, the company did not make changes to its booking platform until after the ACCC stepped in.
The consumer watchdog launched a court action against the accommodation giant in the Federal Court on June 7 and sought to recover the overcharged fees for consumers and impose penalties on Airbnb’s misleading conduct.
“By taking this action, the ACCC wants to make clear to all digital platforms like Airbnb that when they make representation to Australian consumers, they must be accurate and clear,” she told reporters.
“We certainly want companies to know that we’re a tough regulator and intend to take action … They need to comply with our law”.
The ACCC chair also called on consumers to report complaints to the agency if they were charged more than the displayed prices.
“We are seeking higher penalties because we’re well aware of not only the global turnover of these major corporations but also the turnover that they make in Australia,” she said.
Meanwhile, Airbnb said only a small number of customers were affected by the competition regulator’s allegations.
“While a fraction of a percentage of guests is believed to have been impacted, we were nonetheless extremely disappointed to have found that this occurred, and we will compensate affected guests,” Airbnb’s Australia and New Zealand country manager Susan Wheeldon said.
“Upon this issue being brought to our attention by the ACCC, we worked on updating our platform so that the relevant currencies are clearly displayed from the first page for all Australian guests booking stays on our platform”.