ACCC v TPG Internet Pty Ltd [2019] FCA 1677: Court Rules in Favour of TPG
Friday 18 October 2019 @ 11.04 a.m. | Legal Research | Trade & Commerce
In ACCC v TPG Internet Pty Ltd [2019] FCA 1677 (11 October 2019), the Federal Court of Australia (“Federal Court”) has dismissed a case brought by the Australian Competition and Consumer Commission (“ACCC”) against TPG Internet Pty Ltd (“TPG”).
The Federal Court found that representations made by TPG about prepayments customers had to make in its internet, home telephone and mobile plans were not false or misleading, and that a term in its contracts which allowed TPG to keep prepaid funds when customers exited their plans, was not unfair.
As outlined in an ACCC Media Release:
"From 2013 some of TPG’s personal mobile, home telephone and internet plans required customers to make a “prepayment” of at least $20 to cover potential usage outside what is included in their plans, such as excess data usage and phone calls to “1300” numbers.
When a customer’s prepaid balance falls to below $10, TPG directly debits customers so that the amount will return the prepayment to $20. On cancellation of a customer’s plan, they are unable to use the full amount of the prepayment. As a result, TPG retains at least $10 of the prepayment when a customer cancels their plan."
TPG successfully contested that it had told consumers in its Terms and Conditions that the money would not come back, arguing that the term “prepayment” was not mutually exclusive of ultimate forfeiture, disputing the ACCC’s interpretation.
TPG argued that the $20 non-refundable charge was a legitimate financial impost due to the propensity of some consumers to walk away from smaller debts that were more expensive to collect than write off, with O’Callaghan J commenting at paras [111-112]:
O'Callaghan J was not convinced by arguments put forward by the ACCC, noting at para [71]:
Justice O'Callaghan ordered that the proceedings be dismissed and that the ACCC pay TPG's legal costs.
Comment and Reaction from the ACCC
In the Media Release, ACCC Chair Rod Sims said of the Federal Court's decision:
Mr Sims said “[we] will continue to take cases against telco businesses that we consider are making misleading claims about their services.” The ACCC is “carefully considering the judgment”.
Comment from TPG
In a statement issued by TPG, a spokesperson said:
TPG's legal representative said:
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:
Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2019] FCA 1677 (11 October 2019)
TPG off the hook after consumer court case (Canberra Times, 11 October 2019)
Media Release: Court dismisses ACCC’s case against TPG over prepayments (ACCC Media Release 186/19)
ACCC loses prepaid fee slug case against TPG (Julian Bajkowski, ITNews, 11 October 2019)