The Australian Consumer and Competition Commission (ACCC) has launched legal action against Swiss-based ticket reseller Viagogo alleging it engaged in misleading or deceptive conduct as it price-gouged consumers.
The ACCC federal court cases alleges breaches the Australian Consumer Law between May 1 to June 26 2017 because Viagogo failed to disclose substantial fees.
The case does not address claims by some buyers that the company sold fake tickets.
At the Hopman Cup in Perth this year, 129 of the 143 people denied entry bought tickets through Viagogo.
ACCC deputy chair Delia Rickard said Viagogo failed to disclose unavoidable fees upfront in the ticket price, including a 27.6% booking fee for most events and a handling fee.
The consumer watchdog says it found price increases of 29% to 31% when it looked at the site on May 18, including the total price for three Ashes 2017-18 tickets increasing from $330.15 to $426.82 (29%) when the $91.71 booking fee and $4.95 handling fees were included.
The ACCC also alleges Viagogo misled consumers by promoting itself as an authorised ticket seller through the use of the word “official” in search engine advertisements, as well claiming that tickets were scarce without disclosing the “scarcity” only applied to its website.
“Viagogo’s statements such as ‘less than 1% of tickets remaining’ created a sense of urgency for people to buy them straight away, when tickets may have still been available through other ticket sources,” Rickard said.
“By using the word ‘official’, we allege that Viagogo represented in these ads that consumers could buy official original tickets, when in fact Viagogo is a platform for tickets that are being on-sold by others.”
The ACCC says it was contacted 473 times about Viagogo this year and is now making arrangements for the court documents to be served on the company in Switzerland.
It wants injunctions, penalties, corrective publication orders, and other orders in its case against Viagogo.
The privately run company was founded in London in 2006 by American Eric Baker, who co-founded Stubhub, which was subsequently sold to eBay.
Investors in Viagogo included Andre Agassi and Steffi Graf, Lord Jacob Rothschild, and Bernard Arnault, CEO of Louis Vuitton Moet Hennessy.