Court orders Airbnb to pay up to $30m for exchange-rate hit to Aussie travellers

Court orders Airbnb to pay up to $30m for exchange-rate hit to Aussie travellers

Airbnb has been ordered to pay up to $30 million for misleading Australian travellers about the currency of prices displayed on its platform that the consumer watchdog says led to them paying more than expected for accommodation.

The Federal Court has ordered the global accommodation platform to pay $15 million in penalties and up to $15 million in compensation to eligible consumers after the company admitted it had misled Australian consumers.

The court order covers the period between January 2018 and August 2021 when the Australian Competition and Consumer Commission (ACCC) says prices for Australian accommodation should have been displayed in Australian dollars but for more than 60,000 consumers they were stated in US dollars.

The ACCC says Airbnb has acknowledged that during this period prices were displayed for Australian accommodation on its website with a dollar sign that did not indicate whether the price was in Australian or US dollars.

“Consumers were misled about the price of accommodation, reasonably assuming the price referred to Australian dollars given they were on Airbnb’s Australian website, searching for accommodation in Australia and seeing a dollar sign,” says ACCC chair Gina Cass-Gottlieb.

“By paying in US dollars, these consumers were charged more than they expected to pay, and were deprived of a chance to make an informed decision about whether to make the booking because of this misleading conduct regarding the price.

“We took this case to send a strong signal to large digital platforms like Airbnb that they must comply with the Australian Consumer Law and not mislead consumers.”

Airbnb has provided the ACCC with a court-enforceable undertaking to offer compensation to about 63,000 affected consumers who had over 70,000 bookings billed in US dollars. The total value of the compensation scheme could be as much as $15 million, or about $230 per person.

“Affected consumers ultimately paid significantly more than they expected to pay because of the prevailing USD-AUD exchange rate at the time,” says Cass-Gottlieb.

“Some users also paid additional charges to their banks as a result of paying in a foreign currency.”

Cass-Gottlieb says the undertaking by Airbnb to pay compensation provides a ‘meaningful outcome’ for the affected consumers.

“Eligible consumers will be contacted by Airbnb within the next 45 days and invited to lodge a claim, but they can also contact Airbnb to ask about their claim if they think they are eligible for compensation and have not been contacted by that date,” she says.

Airbnb received over 2,000 complaints from Australian consumers who raised concerns about being charged in US dollars during the relevant period.

The ACCC says that the court found that Airbnb had told some consumers that they themselves had selected to have prices displayed in US dollars ‘when in fact some users never made that selection’.

The Airbnb platform was designed so that consumers accessing the platform in Australia who had not manually selected otherwise would be shown prices in Australian dollars, but this was not the case for some consumers. 

The ACCC says Airbnb amended its platform and from 31 August 2021 prices in US dollars were clearly denoted through the use of the abbreviation ‘USD’.

Airbnb has been ordered to pay part of the ACCC’s costs and establish and maintain an Australian Consumer Law compliance program.

Airbnb and Deloitte Australia, which is administering the compensation claims, will contact affected consumers by 5 February 2024.

The ACCC says consumers should be alert to scammers pretending to make contact on behalf of Airbnb or Deloitte.

“The safest way for consumers to gain access to the Deloitte claims portal is via a link in their official Airbnb account,” it says.

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