In Australian Competition and Consumer Commission v iSelect Limited [2020] FCA 1523 the Federal Court of Australia ordered iSelect to pay to the Commonwealth of Australia a pecuniary penalty of $8,500,000 in respect of misleading or deceptive conduct and false or misleading representations in breach of the Australian Consumer Law (ACL) in respect of its electricity comparison service.

The representations related to the way iSelect compared plans as well as pricing.

It represented to consumers visiting its website (at www.iselect.com.au) that through its Comparison Service it would compare all of the plans available from its partner retailers in a consumer’s area and recommend the most suitable or competitive plan to the consumer, when:

• iSelect did not adequately disclose that it did not compare all of the plans available from its partner retailers in the consumer’s area;
• iSelect did not adequately disclose that certain Preferred Partner retailers may have made certain offers via its call centre to consumers that were cheaper than offers made available through iSelect’s online Comparison Service;
• iSelect did not adequately disclose that the recommended plan was not necessarily the most suitable or competitive plan from iSelect’s partner retailers in a consumer’s area.

With respect to pricing, iSelect represented to consumers that the price for an available plan was an amount lower than the price that the consumer would, or would be likely to, pay to the energy provider for that plan, in circumstances where, due to a coding error, iSelect offered plans to some consumers that did not account for controlled load usage in the tariff rate and those consumers were likely to incur costs for controlled load usage.

The ACCC has published a guide Comparator websites: A guide for comparator website operators and suppliers.

The Guide discusses three key principles to assist operators and suppliers when making decisions about all aspects relating to the comparison service:

• Facilitate honest, like-for-like comparisons
• Be transparent about commercial relationships
• Clearly disclose who and what is being compared.

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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.