Singapore-owned Tiger Airways could get skinned by the ACCC over its sale of 30,000 FREE tickets last month that came with a cash price and were advertised contrary to the rules against component pricing.

The ACCC says it will neither confirm nor deny any inquiries or actions it may take.

But it did provide clear guidance over the issue of pricing goods or services by their parts in a manner which may deceive, mislead or misrepresent what was on offer, and pointed out that a further tightening of section 53C of the Trade Practices Act comes into effect on 25 May.

Airlines selling domestic flights in Australia must already prominently display a single price inclusive of GST and all other taxes or levies that is the minimum total cost of the fare between one place and another.

They must not quote an upper and lower range of fares, but one fare which allows consumers to make a ready comparison of competing offers.

Tiger broke that rule between 24 April and 27 April by advertising the fares as FREE in the largest type face in the text of its offer and alongside two equally sized but smaller figures of $22.08 and $35.13 (plus convenience fee*) each way.

Those figures were the range of additional charges plus the unavoidable credit card fee of $5 that represented airport charges and the GST component varying with the origin and destination of the FREE fare.

Even though FREE isn’t a monetary amount it is a representation of the price as being $0.00. The component prices displayed by Tiger were contrary to the rules that its competitor airlines have obeyed for seven years.

And selling something for money when it claimed to be FREE is misleading or deceptive advertising at the most fundamental level.

Is this all too trivial? Not if the law means anything, or if FREE really means $0.00 each way.

Tiger would have collected revenues of at least $812,400 and probably just over $1 million from the FREE sale.

Now that Tiger has emerged from the shadows with serious intent in terms of a massive expansion into the domestic market misleading and illegal pricing seems a matter requiring action.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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