Ah, the sharing economy. We are big supporters of
industry disruption in the name of competitive market conditions
for consumers but an issue that keeps popping up for these new
ventures is non-compliance with Australian laws (*cough*
Airbnb is the latest to fall foul, and it has given enforceable
undertakings to the ACCC in respect of the way it represents prices
For the uninitiated (who are you??), Airbnb is a hugely popular
platform that allows people to rent out space/a room/their
residence to other people. Sounds creepy, we know, but it offers
great flexibility for larger groups (e.g. book a French chateau
that sleeps 12!) and it's a generally awesome way to experience
your travel destination like a local.
Good things aside, the ACCC took issue with the way the Airbnb
platforms failed to disclose mandatory fees to Australian consumers
at the initial stage of searching, in a practice known as 'drip
pricing', where, according to the ACCC, fees and charges are
"incrementally disclosed" to the consumer.
Essentially, Airbnb would display an initial price that
didn't include Airbnb's service fee (or the host's
cleaning fee, if applicable) – these fees were disclosed at a
later stage of the process. This meant the actual price to be paid
by the consumer was greater than what was initially presented to
them, which is a big no-no under the ACL – you know,
misleading or deceptive conduct, false representations and all
Once the ACCC got onto it, Airbnb agreed to amend its practices
and also implement a compliance program to ensure it abides by the
ACL. Good corporate citizen, after all.
Some of the fights the sharing economy disruptors are picking
with lawmakers are pretty fun to watch and we're backing the
law of supply and demand to beat entrenched interests in the end,
but in the meantime the new guard need to ensure they're
complying with the laws they don't need to break.
"Don't mislead consumers" is a big one.
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