The world’s third largest publisher and developer of video games, Electronic Arts Inc and related companies, EA Swiss Sàrl and Electronic Arts Proprietary Limited (together, EA), who run the Origin video game distribution service have provided a court enforceable undertaking to the Australian Competition and Consumer Commission. In the undertaking, EA acknowledged that representations it made to consumers about their rights to refunds and the application of the Australian Consumer Law (ACL) consumer guarantees were likely to have breached the ACL.
“Businesses such as EA selling digitally downloadable goods cannot avoid their responsibilities under the Australian Consumer Law just because they are located outside of Australia,” ACCC Chairman Rod Sims said.
“If you sell to consumers in Australia, then the Australian Consumer Law applies to all goods or services you supply. This includes all of the ACL consumer guarantees, which cannot be excluded, restricted or modified.”
“It is a breach of the Australian Consumer Law for businesses to state that customers are not entitled to refunds under any circumstances. Where a product has a major failure, consumers can insist on a refund or replacement at their choice. Representations that this right has or can be excluded, restricted or modified are false or misleading,” Mr Sims said.
Under the terms of the undertaking, EA has agreed to implement a consumer redress program. Any consumer who purchased a faulty video game through Origin after 1 January 2012 and wishes to seek redress should contact EA to have their claim assessed or, where they have already been denied a refund or remedy by EA, have their claim reassessed in accordance with their statutory consumer rights under the ACL.
EA will set up a 1800 complaints number, an email address and a post office box to handle customer complaints and enquiries. For further information, please visit the front pages of the Origin website or your Origin gaming service. EA is an entertainment software and technology company located in the United States of America and Switzerland. Origin, has over 50 million users worldwide and sells downloadable video games to Australian consumers.
In the 2014 financial year, the American based Electronic Arts Inc earned over US$3.5 billion in net revenue, with over US$1.8 billion coming from digital revenue. There was about a 27% increase of EA’s digital revenue from the previous financial year.
The ACCC was concerned that from at least 1 January 2012, EA made statements through the terms and conditions on Origin and through its customer support representatives that were likely to have conveyed false or misleading representations to the effect that:
- Australian consumers were not entitled to any refunds for digitally downloaded video games purchased through Origin;
- EA had modifed or restricted consumer guarantees in relation to games purchased by Australian consumers through Origin.
Complaints from a variety of sources, received from early 2012, brought this matter to the ACCC’s attention. The ACCC then raised concerns with EA, which cooperated with the ACCC’s investigation and gave a court enforceable undertaking to the ACCC.
Additionally, EA has undertaken for a period of three years that it will not make any representation to an Australian consumer that:
- EA has a ‘no refunds’ policy for games purchased through Origin that excludes any right to a refund under the Australian Consumer Law; and/or
- Australian consumers are not entitled, under any circumstances, to a refund for games purchased from Origin.
EA will also:
- amend their terms and conditions to comply with the Australian Consumer Law
- implement and maintain an Australian Consumer Law Compliance Program, with particular measures for risk assessment, complaints handling and staff training.