DRIVE NOW May/June 2022

ACCC TAKES
UBER TO COURT
by Bianca Healey
The Australian Competition and
Consumer Commission (ACCC)
has launched proceedings in the
Federal Court against global ride
sharing giant Uber over what
the consumer watchdog says
were ‘misleading’ and ‘deceptive’
statements in cancellation
messages.
Uber has admitted it breached
Australian Consumer Law
through cancellation warning
messages and Uber Taxi fare
estimates, the commission said in
a statement.
The US-based platform
has agreed to make joint
submissions with the ACCC
to the Court for penalties
totalling $26 million.
Between around December 2017
and September 2021, the Uber
rideshare app showed warnings
to consumers who sought to
cancel a ride with words to the
effect of: ‘You may be charged
a small fee since your driver is
already on their way’.
This was occurring even when
consumers were seeking to
cancel a ride within Uber’s free
cancellation period, the ACCC
said.
Most Uber services, including the
UberX service, have a five minute
‘free cancellation period’ after
the driver has accepted the trip,
in which an Uber user can cancel
their ride without incurring a fee.
More than 2 million
Australian consumers were
shown the misleading
cancellation warning.
Newly appointed ACCC chair
Gina Cass-Gottlieb said Uber has
admitted it misled Australian
users for a number of years, and
“may have caused some of them
to decide not to cancel their ride
after receiving the cancellation
warning”.
This likely occurred even though
customers were entitled to cancel
free of charge under Uber’s own
policy, Cass-Gottlieb said.
In September 2021, Uber updated
its cancellation messaging for
Uber services across Australia.
The message was amended
to ‘You won’t be charged a
cancellation fee’, in order to
accurately inform customers they
would not be charged during the
free cancellation window.
The ACCC also said that for
about two years, the Uber app
displayed an estimated fare
range for the ‘Uber Taxi’ ride
option which Uber admits misled
users about the estimated range
of the fare of a taxi booked
through that option.
The algorithm used to calculate
the estimated fare range inflated
these estimates so that the
actual taxi fare was almost
always lower than that range,
and consequently cheaper than
Uber’s lowest estimate.
It has also conceded it did not
monitor the algorithm used to
generate these estimates to
ensure it was accurate.
Cass-Gottlieb said consumers
should be confident that they
can trust the accuracy of
information provided by apps
like that offered by Uber.
“The misleading information on
Uber’s app deprived consumers
of a chance to make an informed
decision about whether or not
to choose the Uber Taxi option,”
she said.
“Digital platforms like Uber need
to take adequate measures to
monitor the accuracy of their
38 May/June 2022