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Déjà vu as Flight Centre fined quarter of a million dollars over misleading ads

Antipodean travel giant Flight Centre has been penalised AU$252,000 after the Australian consumer watchdog alleged it published misleading holiday promotions.

The Australian Competition and Consumer Commission slapped the travel retailer with two infringement notices for allegedly deceptive ads promoting holiday vouchers during the Christmas 2018 and Easter 2019 periods.

Flight Centre advertised the promotions in store and in newspapers, offering $250 vouchers to consumers who spent $1500 on a holiday package with the agency. The vouchers were redeemable on their next holiday booked through Flight Centre.

It is a case of Déjà vu for Kiwis, the holiday company having been rapped over the knuckles on numerous occasions by our own Commerce Commission.

Letters of advice were issued in 2013 over allegedly misleading ads promoting Pacific holiday packages and in 2009 over a “Fly for Free” promotion and the advertised pricing of a Thai holiday deal. In 2005 and 2009, it was warned by the commission about bait advertising tactics.

The ACCC argues the Australian ads were misleading and breached Australian Consumer Law because Flight Centre failed to disclose to consumers that redeeming the $250 voucher was subject to certain conditions. They included requiring consumers to book another holiday with Flight Centre worth more than $5000.

The ACCC was also concerned about the limited time frame offered for consumers to redeem the voucher, which it claimed also wasn’t properly disclosed to consumers.

“We are concerned that consumers were enticed to purchase their holiday through Flight Centre to obtain a voucher they were not able to use without spending another $5000, when this was not adequately disclosed,” ACCC Commissioner Sarah Court said.

Over 35,000 consumers received cash vouchers as part of these promotions.Flight Centre Travel Group is the largest retail travel outlet across Australia and New Zealand and boasts operations in the United States, Canada, United Kingdom, South Africa, Hong Kong, India, China, Singapore, United Arab Emirates and Mexico.

It’s ads appeared in print newspapers and on digital screens across about 700 stores for the Christmas promotion and 800 stores for the Easter promotion.

“Businesses are warned that the terms and conditions of any deal or promotion must be prominent, so that consumers understand what is involved in redeeming the offer,” Ms Court said.

Flight Centre has now waived the $5000 minimum spend condition and extended the redemption period for vouchers provided as part of the 2018 Christmas promotion from 30 June 2019 until 31 December 2019. Vouchers provided as part of the 2019 Easter promotion are also able to be used until 31 December 2019.

The payment of a penalty specified in an infringement notice is not an admission of a contravention of the Australian Consumer Law. The ACCC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.

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Kate Jackson

Kate Jackson is the editor of Accomnews. You can reach her at any time with questions or submissions: editorial@accomnews.co.nz

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