The Australian Competition and Consumer Commission has released consumer and industry guidance on the operation and use of comparator websites.
“The consumer guidance offers tips to help consumers get the best outcomes when using comparator websites. The industry guidance sets out the standards that the ACCC expects comparator websites to meet,” ACCC Deputy Chair Delia Rickard said.
“Comparator websites can drive competition and assist consumers to make informed purchasing decisions when comparing what are often quite complex products. However, the ACCC is concerned that poor conduct by some industry participants can mislead consumers,” Ms Rickard said.
The consumer guidance sets out tips that can assist consumers to understand and benefit from comparator websites, including:
- Making sure they know what is being compared
- Understanding commercial relationships
- Know what their needs are.
The industry guidance is targeted at the operators of comparator websites and businesses whose products are listed on them. This guidance sets out how industry can comply with competition and consumer protection laws, including setting out three guiding principles of:
- Facilitating honest, like for like comparisons
- Being transparent about commercial relationships
- Clearly disclosing who and what is being compared
“Operators should carefully read this guidance as there will be no excuse for non-compliance with the Australian Consumer Law, and the ACCC will continue to take action where necessary,” Ms Rickard said.
The ACCC’s recent review of comparator websites was prompted by consumer and business complaints of misleading information being provided to consumers. The ACCC found that a number of websites, in particular those comparing energy plans, included information that may mislead consumers as to the extent of the comparison service, the amount of savings that could be achieved and the impartiality of the comparisons.
Following contact by the ACCC, website operators quickly implemented appropriate changes to remove or amend the potentially misleading information.
In November 2014, the ACCC released a report The Comparator Website Industry in Australia. The report set out the ACCC’s concerns over a lack of transparency in regards to the:
- extent of the comparison service, including market coverage
- savings achieved by using the comparison service
- comparison services being unbiased, impartial or independent
- value rankings
- undisclosed commercial relationships affecting recommendations to consumers
- content and quality assurance of product information.
- The guidance is available at:
- Industry guide for comparator website operators and suppliers
- Consumer guide to comparator websites
The ACCC had previously secured over $2 million in penalties against comparator website EnergyWatch for misleading advertising related to representations about the nature of the Energy Watch service and the savings consumers would make by switching energy retailers through the Energy Watch service.
Compare The Market Pty Ltd paid a penalty of $10,200 following the issue of an infringement notice by the ACCC in relation to claims made in recent advertising promoting Compare the Market’s health insurance comparison service.