No Go for Viagogo: ACCC Takes Ticket Reseller to Court for Misleading Conduct

Tuesday 29 August 2017 @ 9.25 a.m. | Legal Research | Trade & Commerce

The Australian Consumer and Competition Commission (the ACCC) has revealed it will take ticket reselling company Viagogo AG (Viagogo) to court after hundreds of complaints were made to the regulator and warnings were issued from fair trading organisations about the business.

Background to the Action

More than 470 complaints about Viagogo were lodged with the ACCC since the start of 2017, in addition to 143 further complaints to the NSW Office of Fair Trading over the same time period. The action of the ticket reseller has also prompted a warning from the WA Department of Industry, cautioning consumers about “online scalpers”.

Acting Commissioner for Consumer Protection (WA) David Hillyard said in a statement:

“Data made available to us indicates that in a snapshot of 14 events over the last five months at Perth Arena alone, 354 patrons presented with invalid tickets purchased from ticket resellers. In 245 of these cases tickets had been purchased from Viagogo.”

Viagogo is not an Australian company, but is based in Geneva, Switzerland.

The Allegations

The ACCC is alleging Viagogo breached the Australian Consumer Law (the ACL) when reselling entertainment, music and live sport tickets from 1 May 2017 to 26 June 2017. The ACCC also alleges that Viagogo made false or misleading representations, and engaged in misleading or deceptive conduct, regarding the price of tickets on its online platform by failing to disclose substantial fees.

Commenting recently in an ACCC Media Release, ACCC Deputy Chair Delia Rickard said:

“We allege that Viagogo failed to disclose significant and unavoidable fees upfront in the ticket price, including a 27.6 per cent booking fee for most events and a handling fee. For example, in relation to tickets advertised on Viagogo on 18 May 2017 the price of a Book of Mormon ticket increased from  $135 to $177.45 (31% increase) when the $37.50 booking fee and $4.95 handling fees were included; the total price for three Ashes 2017-18 tickets increased from $330.15 to $426.82 (29% increase) when the $91.71 booking fee and $4.95 handling fees were included; and the total price for two Cat Stevens tickets increased from $450.00 to $579.95 (29% increase) when the $125 booking fee and $4.95 handling fees were included. It is also alleged that Viagogo misled consumers by making representations on its website that tickets to certain events were scarce and likely to run out soon, without disclosing that this ‘scarcity’ referred to tickets on its website only. Viagogo’s statements such as ‘less than 1% of tickets remaining’ created a sense of urgency for people to buy them straight away, when tickets may have still been available through other ticket sources.”

The ACCC further alleges that Viagogo misled consumers by promoting itself as an authorised ticket seller through the use of the word “official” in search engine advertisements such as Google:

“By using the word ‘official’, we allege that Viagogo represented in these ads that consumers could buy official original tickets, when in fact Viagogo is a platform for tickets that are being on-sold by others. The ACCC expects all ticket reselling websites to be clear and upfront about the fees they charge, the type of tickets they sell and the nature of their business.” 

Further Concerns for the ACCC

Ms Rickard says the ACCC is also concerned the use of the word “official” in Viagogo’s advertising and online promotions might “trick a lot of consumers”, alleging the ticket reseller was further misleading consumers by presenting itself as an official ticket seller. For businesses operating online stores that may include additional fees, Rickard advises SME owners to “disclose what the total cost will be up front”, where possible:

“The practise is known as drip pricing, where businesses advertises a cheap headline price, but it ends up being more expensive due to large fees consumers aren’t told about until the end. If you can’t work the price out right away, give the total to consumers as soon as you can calculate it.”

For consumers, Rickard advises “as a general rule” they should use authorised seller’s websites, as she believes “events in Australia rarely sell out”.

Remedies Sought by the ACCC

The ACCC is seeking declarations, injunctions, pecuniary penalties, corrective publication orders, orders for a compliance program and costs, and Rickard says while the company’s international location “does make it more complex, it does not deter us”.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products. Nothing on this website should be construed as legal advice and does not substitute for the advice of competent legal counsel.

Sources:

ACCC takes ticket reseller Viagogo to court – ACCC Release MR 143/17

ACCC takes international ticket reseller Viagogo to court after receiving hundreds of complaints – smartcompany.com.au

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