Australia’s consumer watchdog wants a multimillion-dollar penalty for travel website Trivago, after a Federal Court judge found the hotel comparison site misled consumers.
Australian Competition and Consumer Commission boss Rod Sims said he wanted to make an example of Trivago’s “outrageous behaviour”.
“We want to send a message to Trivago and others not to mislead consumers and not to have consumers paying more than they need to be,” Mr Sims said on Tuesday.
The ACCC would push for Trivago to face penalties “in the millions” of dollars, he said.
“We want these to be penalties that the company sits up and takes notice of.”
On Monday, Federal Court Justice Mark Moshinsky found that Netherlands-based Trivago had failed to actually show customers the cheapest deals for hotel rooms, as it claimed. Rather it had promoted advertisers who paid them the biggest fees.
“Contrary to the impression created by the relevant conduct, the Trivago website did not provide an impartial, objective and transparent price comparison service,” Justice Moshinsky said.
“The fact that Trivago was being paid by the online booking sites was not made clear.”
News: Trivago misled consumers about hotel room rates https://t.co/evPuVo5zrm
— ACCC (@acccgovau) January 20, 2020
The company was also found guilty of false and misleading price comparisons because it compared standard room rates with luxury rooms at the same hotels.
This created a false impression of savings to those shopping around for a good hotel deal.
Australia’s consumer watchdog took the company to court last August after a hotel owner alerted it to misleading information on the Trivago website.
“A hotel owner saw what was happening and let us know. They knew that the prices weren’t the best prices and they put us on to this,” Mr Sims said.
The claims were aired more than 400,000 times from late 2013 to mid-2018.
The matter will return to the Federal Court for case management at a date yet to be set.