Full Federal Court dismisses ACCC appeal in TPG 'prepayment' case

30 July 2020

The Full Federal Court has dismissed the ACCC’s appeal against TPG Internet Pty Ltd (TPG) in relation to the marketing and sale of some prepaid internet, home telephone and mobile plans.

The prepaid plans at issue required customers to make a ‘prepayment’ of at least $20 for the potential usage of services not included in the value of their plan.

When the prepayment balance drops below $10, TPG automatically topped up the prepayment balance to $20. When the plan was cancelled, the prepayment balance was forfeited.

The ACCC’s case was that by representing this was a ‘prepayment’, consumers were misled by TPG into thinking they could use all the money they had prepaid for out-of-plan services, when this was not usually possible. 

The Full Federal Court held that TPG’s use of the word ‘prepayment’ did not convey anything about the way in which TPG would hold and apply the prepayment, particularly at the end of the plan.

“We took this case and appealed the previous decision because we considered that TPG was misleading consumers by not adequately disclosing the details about the mandatory prepayment,” ACCC Deputy Chair Delia Rickard said.

“Consumer awareness of important terms should not be expected where they are contained in the fine print of a long and detailed contract or, in the case of online contracts, after multiple click-throughs.”

“We remain concerned that TPG’s customers were not able to use up their full prepayment, or get a refund for any unused funds,” Ms Rickard said.

The ACCC will now carefully consider the judgment.

Background

On 4 December 2018, the ACCC instituted proceedings in the Federal Court against TPG for engaging in misleading conduct about a $20 ‘prepayment’ made by consumers, and including unfair prepayment contract terms in some of the telco’s plans.

On 11 October 2019, the Federal Court found that the representations made by TPG were not false or misleading, and that the term in its contracts was not unfair.

The ACCC appealed the decision about the misleading conduct on 8 November 2019. The ACCC has not appealed the unfair contract term aspect of the judgment.

Release number: 
158/20
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