Federal Government announces plans to halt dynamic ticket pricing and ‘subscription traps’

Australian Prime Minister Anthony Albanese has today announced plans to protect consumers and suppliers by banning unfair trading practices under the Australian Consumer Law.

The move will see ‘dynamic pricing’ concert tickets banned as the Federal Government cracks down on what it calls “dodgy” trading practices including “subscription “traps” for gym memberships, airline tickets, hotel rooms and online shopping.

A statement released by the Prime Minister’s office advised “from concert tickets to hotel rooms and gym memberships, Australians are fed up with businesses using tricky tactics that make it difficult to end subscriptions or add hidden fees to purchases.

“These practices can distort purchasing decisions, or result in additional costs, putting more pressure on the cost of living.”

It notes that the Federal Government’s actions will address a wide range of practices, including:

• ‘Subscription traps’ that use arduous and confusing steps to make cancelling a subscription difficult.

• ‘Drip pricing’ practices where fees are hidden or added throughout the stages of a purchase.

• Deceptive and manipulative online practices that aim to confuse or overwhelm consumers, omit or hide material information, or create a false sense of urgency or scarcity – this can include warnings that a customer only has limited time to purchase a product.

• Dynamic pricing where a product’s price changes during the transaction process.

• Requiring consumers to set up an account and provide unnecessary information to make an online purchase.

• Where a business makes it difficult for a consumer to contact them when they have a problem with their product or service.

It also notes that “Treasury will consult on the design before the (Federal) Government legislates a general prohibition on unfair trading practices.

Announcing the planned ban, Prime Minister Albanese stated “we're taking strong action to stop businesses from engaging in dodgy practices that rip consumers off.

"Today's announcement puts businesses engaging in unfair trading practices on notice.

"Hidden fees and traps are putting even more pressure on the cost of living and it needs to stop."

Treasurer Jim Chalmers added “whether it's traps that make it difficult or confusing to cancel a subscription, hidden fees and charges at different stages of a purchase, deceptive or manipulative practices online or making it difficult for people to report problems with their products or services, we're going to change the rules.”

Treasurer Chalmers’ office said areas to be addressed include ‘subscription traps’, which make it difficult to cancel a subscription, ‘drip pricing’, where extra fees are gradually added along each stage of a purchase such as for concert tickets, or websites requiring customers to set up accounts which are unnecessary for the purchase they want to make.

Also to be banned are online marketing ploys which “aim to confuse or overwhelm consumers, omit or hide material information, or create a false sense of urgency or scarcity”. Those are said to include “warnings that a customer only has limited time to purchase a product”, commonly used by some large online retailers.

Another key proposal will be to address ‘dynamic pricing’, which the Federal Government described as where product prices change during the transaction process. It is a controversial fee structure, which can see prices spike high above the originally advertised price.

The practice recently came under scrutiny in relation to highly sought after concert tickets.

The reforms aim to empower the Australian Competition and Consumer Commission (ACCC) and state and territory consumer protection agencies to issue infringement notices or pursue penalties for breaches of the Consumer Guarantee and Supplier Indemnification provisions of the Australian Consumer Law.

Following consultation, the Federal Government will work with states and territories to settle a final reform proposal in the first half of 2025.

Consultation Paper
The announcement coincides with the release of a consultation paper on reforms to strengthen protections for consumers and small businesses under the Consumer Guarantees and Supplier Indemnification provisions of the Australian Consumer Law.