Webjet ordered to pay $9m for misleading airfare price statements

A subsidiary of Webjet Group (ASX: WJL) has been ordered by a Federal Court to pay $9 million in penalties for making false or misleading statements when it advertised airfares without including compulsory fees, as well as sending confirmations for flight bookings that had not actually been confirmed.

The group's online travel agency Webjet admitted that between 2018 and 2023 it made the statements on its website, in promotional emails and in social media posts.

The Webjet fees comprised the “Webjet servicing fee” and “booking price guarantee” fee which ranged from $34.90 to $54.90 per booking, depending on whether the flights were domestic, to New Zealand and the Pacific, or other international destinations.

While Webjet’s website, app and most emails contained information about the additional fees, some users had to scroll to the fine print near the bottom of the screen to see them. In its social media posts, Webjet didn’t disclose the additional fees at all.  

The Australian Competition and Consumer Commission (ACCC) commenced its investigation into the matter after a consumer complained about an airfare advertised as “from $18”, which cost almost three times that price after Webjet added its compulsory fees.

“We took this case because we considered that Webjet used misleading pricing by excluding or not adequately disclosing compulsory fees in its ads,” ACCC Chair Gina Cass-Gottlieb said.

“Seeking to lure in customers with prices that don’t tell the whole story is a serious breach of the Australian Consumer Law.

"Retailers must ensure their advertised prices are accurate. They should clearly disclose additional fees and charges."

The Webjet fees represented 36 per cent of Webjet’s total revenue in the period from 1 November 2018 to 13 November 2023.

Webjet also admitted that between 2019 and 2024 it provided false or misleading booking confirmations to 118 consumers for flight bookings which had not actually been confirmed.

Webjet later asked for additional payments of up to $2,120 from consumers to complete the booking, but has since refunded these consumers.

Webjet co-operated with the ACCC, admitted liability and agreed to make joint submissions to the court about orders, including the penalty. The court also made declarations and other orders proposed, including that Webjet review its compliance program and pay a contribution to the ACCC’s costs.