The marketing also claimed customers would get a significant discount for paying on time without disclosing that the discounts were credited against charges on the next bill and not the current bill. This meant those who paid their final bill did not get a discount for paying on time as there was no subsequent bill to be discounted.
The government recently brought in rules to limit pay-on-time discounts after finding one in four households failed to meet retailers’ highly conditional criteria.
The Australian Energy Market Commission also announced stronger rules designed to stop the practice of retailers offering what it called “pseudo-discount deals that leave consumers worse off”.
Misleading claims like those by Click Energy only make it harder for everyday consumers to make informed choices on a major household expense.
ACCC Commissioner Sarah Court
Australian Competition and Consumer Commission (ACCC) commissioner Sarah Court said in a statement that the claims made it harder for households to find better deals.
“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,” Ms Court said.
“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.”
The court ordered Click Energy to pay the penalty cost, an additional $50,000 in legal fees to the ACCC, and send notices to customers who signed up for plans within the period.
Customers will also be notified online with a “corrective notice” published on its website, detailing the court action and telling customers they are free to review their plan and cancel at any time without penalty.
Amaysim chief executive Peter O’Connell said in a statement posted to the ASX on Wednesday morning that he was pleased to have “the matter behind us”.
“It largely relates to legacy Click Energy products which have not been offered to the public for quite some time and we worked expeditiously at the time to address the ACCC’s concerns,” Mr O’Connell said.
The market announcement said Amaysim had anticipated the penalty in its 2019 half-year accounts, which will be reflected in full-year statutory results, and it would not affect the full-year underlying earnings guidance (before interest, tax, depreciation and amortisation).
Click Energy has to stick to a compliance program for three years at their own cost, including the appointment of an internal or external compliance professional with expertise in consumer law to conduct a risk assessment and provide a written report, strengthened complaints handling system and staff training.
Jennifer Duke is a media and telecommunications journalist for The Sydney Morning Herald and The Age.
Covering energy and policy at Fairfax Media.