The Albanese Government will ban dodgy business practices ripping off Australians, today opening public consultation on our plan to ban unfair trading practices.
We will ban:
- Subscription traps: Consumers are all too familiar with subscriptions that are easy to sign up to and impossible to get out of. These ‘subscription traps’ will be banned under proposed changes that will require businesses to make getting out of a subscription just as simple as signing up.
- Dynamic pricing: where the price of a product increases during the transaction process as more people attempt to make a purchase. This is particularly prevalent when purchasing concert tickets.
- Drip pricing: common on flight or hotel bookings where the advertised cost goes up and up when purchasing the product with mandatory fees added.
These practices are un‑Australian and have a real hit on people’s hip pockets.
The consultation seeks feedback on a proposal to:
- Prohibit unfair trading practices
- Ban specific practices, including subscription traps, drip pricing, and dynamic pricing
- Introduce penalties for businesses who fail to comply
Following public consultation, the Albanese Government will work with state and territory governments to introduce legislative amendments to the Australian Consumer Law.
Common examples of unfair trading practices considered by the consultation paper:
- Subscriptions that silently renew or automatically rollover from a free trial or promotional period to a paid or full price subscription
- Warnings that create a false sense of scarcity by claiming a small number of items are left (for example ‘only 2 items left’), despite stock being available elsewhere
- Subscription cancellation processes that are difficult to navigate and overly complex or time consuming
- Increasing ticket prices during the transaction process (commonly based on demand as more people enter the queue)
- Mandating consumers have an online account and requiring them to provide unnecessary personal information in order to make a purchase
- Making it difficult to access customer support to raise a complaint or problem with a product or service
The Government encourages all interested parties to make a submission in response to the consultation paper, which can be found on the Treasury website.
Submissions will close on 13 December.
Comments attributable to Assistant Treasurer and Minister for Financial Services, Stephen Jones MP:
“The Albanese Government is putting a stop to the tricky tactics used by businesses to rip off Australians.
“It’s deceptive, unfair and un‑Australian.
“There won’t be a consumer in the country who hasn’t had an experience with the unfair trading practices that we are planning to ban, like trying to cancel a subscription that is easy to sign up to but impossible to leave.
“This will be welcome news for people who will save time and money when these practices are outlawed.”
Comments attributable to Consumer Policy Research Centre CEO, Erin Turner:
“This consultation is a crucial step towards protecting Australians from unfair business practices that are costing people money and causing harm.
"Our research shows that 75 per cent of Australians have experienced a negative consequence when trying to cancel a subscription, with far too many companies making it easy to sign up but far too hard to stop paying. One in 10 Australians found the unsubscribe process so hard or confusing that they’ve kept paying for a service they no longer want or need.
"A general law against unfair trading will help people save money, protect against manipulative designs, and support Australians in making informed choices.”