In the first litigation of its kind, the Australian Competition and Consumer Commission (ACCC) has commenced proceedings in the Federal Court against CLA Trading (trading as Euopcar) for allegedly charging clients too much for credit and debit card payment fees.
In breach of the Competition and Consumer Act, the ACCC claims Europcar overcharged customers who used Visa or Mastercard credit cards in July and August 2017, and customers using Visa or MasterCard debit cards between July and 5 November 2017.
The ACCC alleges overbilling ranged from 0.18% to 0.65% more than what was allowed, with surcharges running up to 1.43% in total.
Making matter worse for the rental giant, the watchdog says Europcar failed to reduce its surcharges even after being notified by its bank in July 2017 of the actual cost of accepting payments by these cards.
“The alleged conduct by Europcar in relation to its surcharge rates is particularly concerning, given we will allege that it was well aware of its own cost of acceptance from at least July 2017,” ACCC chair Rod Sims said.
“Businesses must not charge customers more than it costs them to process a card payment.
“The ACCC’s action serves as a warning that the ACCC is paying close attention to those businesses who seek to overcharge customers making payments by credit or debit cards.”
Legal proceedings only relate to outlets owned and operated by Europcar, and not by franchisees - that is, 96 of the 126 locations in Australia.
Under the excessive surcharging law, businesses are only allowed to pass on to customers the amount it costs them to process a payment.
In 2016, Federal Court fined Europcar Australia $100,000 for misleading consumers about their liability in the event of vehicle damage in rental agreements in 2013.