ACCC Issues Fine to Palace Cinema for Mandatory Online Booking Fee

How many times have you gone to purchase your movie tickets online only to find that the cinema has snuck in a mandatory booking fee? Fear not – the Australian Competition and Consumer Commission is on your side. The ACCC has recently fined Palace Cinemas Pty Ltd (Palace Cinemas) $10,800 for not properly displaying the total ticket prices of movies in the online booking process.

The ACCC issued Palace Cinemas with an infringement notice because it was concerned that Palace Cinemas was making a part-price representation by not providing the purchaser with the total ticket price during the booking process.

Instead, the $1.30 booking fee was only displayed at the very last page. The user did not have an opportunity to factor this cost in until they were at the end of the booking process.

Leaving out the compulsory booking fee when making price representations is considered a breach of the Australian Consumer Law (ACL) and the ACCC can issue infringement notices where it believes the ACL has been contravened.

According to ACCC Chairman Rod Sims, other cinema chains such as Hoyts and Village have responded to the ACCC’s concerns about the pricing representations, but Palace Cinemas did not respond well.

Chief Executive of Palace Cinema Pty Ltd, Benjamin Zeccola, defended the business and remains adamant that they have always been compliant with the ACL as far as their technology would allow. He backed his position by explaining that their website did not have the capability to display the mandatory booking fee until the last page. Zeccola explained that the website could not calculate the total price of the ticket and the booking fee and that it required the user to click ‘proceed’ to calculate the total fee.

Palace Cinema has paid the penalty of $10,800, but it is not an admission of the contravention. Rather, Zeccola explained that they paid the fine in this situation because there is no other mechanism to dispute it.

While Chairman Sims acknowledged Zeccola’s explanation of the technology hindrance, the primary goal of the ACCC has been to work with the cinema industry to improve pricing practices. Sims views cinemas presenting clearer pricing information as a way to assist consumers in being able to make more informed decisions when it comes to movie ticket prices.

It is not the compulsory online booking fee that is the concern, but rather the fact that it was not clearly displayed and communicated to users before reaching the end of the booking process.

Key Takeaways

To avoid being issued with a similar infringement notice, make sure that you display clearly your prices for goods or services. If there is any additional fee that will be added to the total price, let the consumer know early. If the ACCC considers your pricing representations to be part-prices, or not adequately displayed, you may be found to be in contravention of the ACL.

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If you have any questions about complying with the ACL, get in touch with our consumer lawyers on 1300 544 755.