ALTHOUGH it wasn’t the $90 million fine the ACCC was asking for, last month the Federal Court handed down the hefty penalty of $44.7 million to the Expedia-owned Trivago for making misleading representations to Aussies about hotel room rates.
The decision draws to a close legal proceedings against the company that have bubbled along for years, with Trivago admitting that between December 2016 and September 2019 it earned close to $60 million in fraudulent revenue, a result of misrepresenting offers that earned the company the biggest margins as being the cheapest hotel rooms on the market.
Trivago also misled consumers by using strike-through prices which gave consumers the false impression that its rates represented a saving when in fact they often compared a standard room with a luxury room at the same hotel.
“Trivago’s conduct took advantage of consumers’ desire to find the best deal, and the Court’s decision to order such a significant penalty reflects the seriousness of Trivago’s conduct,” the ACCC observed after the decision was handed down.
“One of the ACCC’s key priorities is to hold online businesses accountable for their representations to consumers and to ensure consumers are fully aware of the way these supposedly free services actually work and what influences the prices they display.”
The case, which was brought forward by the consumer watchdog, is part of a wider offensive by the ACCC to clamp down on digital platforms taking advantage of consumers, with Uber the latest company to face court for allegedly misleading travellers about fare rates and cancellation fees.