Airbnb has been fined A$15 million by Australia’s Federal Court for misleading around 63,000 Australian customers. The company was found to have displayed prices in US dollars instead of the lower value Australian dollars on its website, leading to customers paying more than expected for their accommodations. In addition to the fine, Airbnb has agreed to pay compensation to those affected, which could amount to another A$15 million. The court case highlights the importance of price transparency and compliance with consumer protection laws for digital platforms like Airbnb.
The issue arose when some lettings on the Airbnb website showed prices initially denoted with the dollar sign but without specifying the currency. It was only on the final booking screen that the prices were displayed in a small font as USD. This discrepancy affected approximately 70,000 bookings and 63,000 consumers in Australia.
Airbnb received over 2,000 complaints from Australian customers who were concerned about being charged in US dollars. The court found that some of these consumers were falsely informed that they had selected prices in US dollars, even though they had not made that choice. As a result, affected customers ended up paying more than they had anticipated, with some incurring additional charges from their banks due to foreign currency transactions.
The Australian Competition and Consumer Commission, responsible for bringing the case against Airbnb, emphasized the need for digital platforms to comply with consumer protection laws and not mislead consumers. The commission’s chair, Gina Cass-Gottlieb, stated that the fine should serve as a strong warning to other large digital platforms to adhere to Australian Consumer Law.
Gina Cass-Gottlieb further explained that the affected consumers had to pay higher amounts due to the prevailing exchange rate between USD and AUD at the time. She also mentioned that some users incurred additional fees from their banks due to transacting in a foreign currency. Airbnb has been instructed to contact eligible customers for compensation within the next 45 days. However, customers who believe they may have been affected and have not received communication from Airbnb by that date are encouraged to reach out to the company directly.
Following the incident, Airbnb has made changes to how prices are displayed on its platform for countries that use the dollar. The company now shows a three-letter currency code consistently throughout the booking process. Susan Wheeldon, Airbnb’s country manager for Australia and New Zealand, issued an apology and expressed disappointment over the situation. She asserted that although only a small percentage of Australian users were impacted, the problem has been resolved, and guests are now provided with clear information regarding their payment currency.
This case serves as a cautionary tale for digital platforms and highlights the importance of transparent pricing practices and compliance with consumer protection laws. It reinforces the need for companies to prioritize accuracy and clarity in displaying prices to ensure that customers are not misled or overcharged. Consumers should also remain vigilant when making online bookings and review payment details carefully to avoid any potential discrepancies or unexpected charges.
