The ACCC commenced proceedings against Airbnb, Inc and its subsidiary Airbnb Ireland UC (together Airbnb) on 8 June 2022, alleging that Airbnb made false or misleading representations and engaged in conduct that was misleading or deceptive, or likely to mislead or receive, by displaying prices in US dollars (USD) to Australian users on the Airbnb platform.
This is not the first time Airbnb’s representations to users about prices have been reviewed by the ACCC. In 2015, Airbnb Ireland previously provided the ACCC with enforceable undertakings in relation to “drip pricing”, or a failure to disclose certain fees on its platform upfront in a “headline” price.
The proceedings reflect the ACCC’s continued focus on digital platforms and on representations made to consumers about the price of goods and services online.
Background and ACCC’s allegations
Airbnb operates an online, peer-to-peer marketplace for rental accommodation. Users in Australia access the Airbnb platform via a website and mobile apps.
The ACCC’s allegations relate to the period from at least January 2018 to August 2021. The ACCC alleges that Airbnb did not make it clear to Australian consumers that the prices on its platform were in USD, resulting in those consumers being charged a value in Australian dollars (AUD) that was higher than the price displayed to them. Some consumers also paid a currency conversion fee to their financial institution.
The ACCC’s allegations go beyond representations made on the Airbnb platform. It also alleges that consumers who complained to Airbnb were told that that they had selected that the Airbnb platform show prices in USD. The ACCC has gathered examples of the statements made by Airbnb personnel to support this allegation.
Accordingly, the ACCC’s case is that Airbnb’s conduct breached the following provisions of the Australian Consumer Law (ACL), contained in Schedule 2 to the Competition and Consumer Act 2010 (Cth) (CCA):
- Section 29(1)(i), by the Airbnb platform making a false or misleading representation as to the price of accommodation available; and
- Section 18, by engaging in conduct that was misleading or deceptive, or likely to mislead and deceive by:
- the Airbnb platform making the above representations; and
- customer support personnel making representations that consumers had selected that the Airbnb platform show prices in USD.
The ACCC is seeking declarations, injunctions, pecuniary penalties, orders for the compensation for affected consumers, costs, and other orders.
An overseas trip?
The Airbnb parties to the proceedings by the ACCC are incorporated in the United States of America and Ireland respectively. For the relevant provisions of the ACL to apply to Airbnb, the ACCC will need to show that Airbnb’s conduct occurred in Australia or that the Airbnb parties were ‘carrying on business’ within Australia. Airbnb also employs customer support personnel and engages third parties to provide customer service assistance to users in Australia. The ACCC alleges that any third parties or their customer service personnel were agents of Airbnb. The framing of the territorial links in the pleading demonstrates the ACCC’s willingness to enforce Australian consumer laws against global digital platforms and to hold them accountable for pricing representations made users in Australia.
Where to from here?
The proceedings against Airbnb are in line with the ACCC’s enforcement priorities to target consumer issues relating to digital platforms. In a statement released about the present proceedings, ACCC Chair, Gina Cass-Gottlieb, emphasised the ACCC’s concerns about pricing statements on digital platforms, stating that: “By taking this action, we are stating very clearly that digital platforms like Airbnb need to ensure the accuracy of all statements that may affect consumer’s purchasing decisions”.
These proceedings also follow:
- recently concluded proceedings against another online platform, ticket reseller viagogo, which was ordered to pay $7 million in penalties by the Full Federal Court in May 2022 for, among other conduct, failing to sufficiently disclose fees to consumers;
- the introduction of consumer protection standards which prescribe the wording and pricing information that must be displayed by event ticket resellers on electronic platforms; and
- its success in proceedings against Trivago for misleading representations about hotel room rates on its website.
More broadly, the ACCC has flagged concerns about pricing practices by online retailers in its Digital Platforms Inquiry final report and Digital Platform Services Inquiry March 2022 interim report.
It looks like Airbnb won’t book a vacation from the ACCC for a while.
Image credit: Beach huts – Canon eos 550d by @Doug8888 / Openverse / CC BY-NC-SA 2.0 / Remixed to BBW and resized
