Europcar fined $350,000

Europcar has to pay $350,000 in penalties for charging excessive credit and debit card payment surcharges in breach of the Competition and Consumer Act 2010.

The Federal Court ruling is the culmination of proceedings by the Australian Competition and Consumer Commission. The Europcar Australia vehicle rental network numbers 126 rental outlets but the proceedings only related to the 96 outlets owned and operated by Europcar and not those run by franchisees.

Proceedings against the car rental firm began in July 2018 for breaches of the excessive surcharging laws.

CLA Trading Pty Ltd (trading as Europcar) admitted that, between July and August 2017, Europcar charged Visa and MasterCard credit users fees that were higher than its costs to accept payments from those credit cards.

It also admitted that, between July and 5 November 2017, the company had charged excessive surcharges on Visa and MasterCard debit cards.

Europcar fined $350,000 for excessive surcharges

ACCC deputy chair Mick Keogh said “Europcar imposed excessive surcharges on transactions affecting 63,012 customers, and over-charged more than $67,000.

“As a large and sophisticated business, Europcar was well aware of its obligations to comply with the law prohibiting excessive surcharges,” he said.

The amount of each excessive surcharge charged by Europcar was relatively small, at an average of just over $1 per customer.

“While the amount per customer was small, Europcar imposed these charges on thousands of consumer transactions which quickly added up to a considerable amount,” Keogh said.

“This decision is a warning to businesses that choose to impose surcharges. The onus is on them to get it right. A failure to comply with these laws may result in significant penalties.”

The car rental business reviewed its surcharging practices to ensure its compliance with the excessive surcharging laws from 6 November 2017 onwards.

Europcar also provided refunds to the majority of customers that it identified as having been charged excessive surcharges between July and November 2017.

Statement from Europcar

In a statement Europcar Australia  said although it had “received relevant data from its financial services provider in mid-July 2017 a system limitation delayed implementation of the new rules”.

 

It said the 63,012 customers affected by this error have been fully refunded at a cost to the company of $67,215.59.

“The company has fully cooperated with the ACCC since it commenced its investigation in October 2017. At every step we have sought to be open and transparent with the ACCC to identify and correct this issue and to ensure the best possible outcome for all of our customers and provide the high-quality service they can rely on.”

[This article has been updated to include a statement received from Europcar]