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Click Energy fined $900,000 for misleading marketing

Power retailer Click Energy has been fined $900,000 by the Federal Court for making false or misleading marketing claims over potential discounts and savings.

The Australian Competition and Consumer Commission launched the case in July 2018, alleging publicised discounts were inflated by the Amaysim-owned company and that the company didn’t disclose conditions for early payment discounts.

An ACCC example of Click Energy’s infringing claims capture in November 2017

Click is the latest energy supplier to fall foul of the ACCC over its advertising. In January, Wesfarmers-owned Kleenheat was hit with a $25,000 fine for false advertising while last year, News Corp-backed One Big Switch was fined $25,2000 by the ACCC for misleading consumers.

In the latest case the ACCC alleged between October 2017 and March 2018, Click Energy told consumers they could get discounts of between 7 and 29 per cent under its market energy offers if they paid their bills on time.

The regulator alleged Click’s claims were misleading because the discounts were calculated on market offer rates, which were higher than the company’s standing offer rates available to all consumers. Effectively meaning discounts were smaller than claimed and, in some cases, non-existent.

“Click Energy’s conduct misled consumers into thinking they were getting a significant discount, when in reality these discounts were often much smaller than advertised,” ACCC Commissioner Sarah Court said.

Managing director of Click Energy, Dominic Drenen, said in a statement: “The proceedings brought by the ACCC were in respect of Click Energy legacy products only, which have not been offered to the public for quite some time, and have now been resolved.

“We are pleased to have this matter behind us. The company takes its obligations under Australian Consumer Law seriously and we used this opportunity to improve the way in which Click Energy advertises its products.”

In its ruling the court also found Click Energy had made false or misleading representations to consumers about when the discounts given to customers who paid on time would be applied to their bills, by not adequately disclosing the applicable conditions surrounding the discounts.

These included that discounts would apply as a credit on a subsequent bill and that no benefit would be received by paying a final bill on time.

“This penalty is a strong reminder to all energy retailers that making misleading pricing claims is unacceptable and in breach of the Australian Consumer Law,” Ms Court said.

“The retail electricity market is already too complex and opaque for many households to navigate and get the best deal. Misleading claims like those by Click Energy only make it harder for everyday consumers to make informed choices on a major household expense”.

“Consumer and competition issues arising from opaque and complex pricing of essential services, in particular energy and telecommunications, are a 2019 compliance and enforcement priority for the ACCC,” Ms Court said.

Click Energy was also ordered by the Court to send each affected customer a notice correcting the misleading claims, implement a consumer law compliance program and pay an agreed amount towards the ACCC costs.

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