ACCC Loses TPG ‘Prepayment’ Appeal
The Full Federal Court has dismissed the ACCC’s appeal against TPG over a $20 ‘prepayment’ for selected prepaid plans, however, the consumer watchdog remains concerned.
In December 2018, the ACCC commenced proceedings against TPG in the Federal Court over misleading conduct surrounding the ‘prepayment’. and unfair contract terms on some plans.
The Federal Court did not deem the representations misleading nor contracts unfair in October 2019, with the ACCC appealing the ‘prepayment’ allegations the month after.
Selected TPG prepaid plans required a ‘prepayment’ of at least $20 at issue for the potential usage of services not included in the value of their plan.
TPG automatically topped up the prepayment balance if it dropped below $20, with the balance forfeited if the plan was cancelled.
“We took this case and appealed the previous decision because we considered that TPG was misleading consumers by not adequately disclosing the details about the mandatory prepayment,” states ACCC Deputy Chair Delia Rickard.
“Consumer awareness of important terms should not be expected where they are contained in the fine print of a long and detailed contract or, in the case of online contracts, after multiple click-throughs”
“We remain concerned that TPG’s customers were not able to use up their full prepayment, or get a refund for any unused funds.”
The ACCC asserts that by representing the charge as a ‘prepayment’. consumers were misled into believing they could use all the money they had prepaid for out-of-plan services, when this was not usually possible.
The Full Federal Court has held that TPG’s use of the word ‘prepayment’ does not convey anything about the way TPG would hold and apply the prepayment, especially at the end of the plan.
The news follows the completed merger between TPG Telecom and Vodafone Hutchinson Australia, following Federal Court approval earlier this year – overturning the ACCC’s bid to oppose.