Home improvement platform Hipages has admitted to engaging in misleading or deceptive conduct in breach of the Australian Consumer Law between October 2018 and January 2022.

It led to the company failing to disclose contract terms allowing it to automatically renew subscriptions and charge an early termination fee.

After an ACCC investigation, Hipages provided a court-enforceable undertaking, committing to clearly disclose subscription renewal and cancellation policies in phone transcripts and email communications.

The platform connects tradespeople/small businesses with consumers who need work completed.

ACCC Deputy Chair, Mick Keogh has said, “Many subscribers were unaware that they had to specifically opt out of Hipages’ automaatic 12-month renewal, and that there was only a very short cooling off period in which they could avoid paying an early termination fee.”

“When some people attempted to cancel their auto-renewed contracts, they were told they would have to pay out the full 12-month term.”

Hipages have also admitted to contravening the Australian Consumer Law by making false and misleading representations to certain subscribers. This occurred between 18th April 2020, and 16th April 2021.

Some subscribers were told they need to take additional steps to cancel their contract, and the platform had the right to enforce payment for a further term of the contract. These subscribers had already given valid notice of cancellation prior to the automatic renewal date.

Hipages has also committed to reviewing the complaints handling system, review and seek to resolve the outstanding complaints, and to implement a consumer law compliance program.

“The rise of online marketplaces has brought greater convenience to many people, but it’s also led to an increase in sneaky tactics such as subscriptions that are difficult to get out of,” said Mr. Keogh.

“Businesses, including online platforms, must be clear and up-front with their customers about important contract terms such as renewals and cancellations. Failure to do so risks breaching the Australian Consumer Law and may result in enforcement action.”

Hipages cooperated with the ACCC and has taken steps to clearly disclose subscription contract terms, and provide additional email and SMS reminders to subscribers ahead of upcoming automatic renewal.