Selling Travel in Oz? Read This Update.

(Sydney Morning Herald - May 29, 2009) -- The travel industry has been warned there will be no grace period for changes to the Trade Practices Act to outlaw component pricing, by which a supplier advertises a price that doesn't include additional taxes and charges.

The changes were enacted last week but had been in the pipeline for three years, since they were first proposed by the previous federal government.

Two industries travel and automobiles were singled out as the biggest users of component pricing in Australia, even though three of the four domestic airlines have voluntarily observed a pricing-transparency code for most of the past three years.

Now, the agency that will enforce the new legislative changes, the Australian Competition and Consumer Commission, says no mercy will be shown to lawbreakers.

"It's not as if it has crept up on people without notice, without warning," says ACCC chairman Graeme Samuel.

"It has been in the offing now for some three years. It went through an extensive and I mean extensive consultation period involving our key industries, particularly the motor vehicle industry and the travel industry.

"They know what the law provides. Some of them don't like it and they've made that clear since the law was passed by parliament.

"[But] all I can say is that the law is there and it will be enforced without any concessions.

"If this was a law that had suddenly come into place very quickly without a lot of warning, without any consultation, then I could understand a plea being made for some concession in the early stages. But people know what the law means; they'll have to abide by it.

"There will be no forbearance, there'll be no concessions because this has been on the cards for three years."

Samuel says Tiger Airways was sailing close to the wind when it dared to advertise "free" air fares this month that did not include compulsory taxes and charges, now an illegal practice.

However, he said other airlines, such as Jetstar, may also have to alter their website booking procedures, which until last week were still providing a "headline"' price that excluded taxes and charges that take the total price (revealed pages later in the process) much higher sometimes double.

And foreign travel retail websites, such as US-based Orbitz, were warned they also could find themselves in trouble as the ACCC awaits a clarification of the law about the definition of doing business in Australia.

"It doesn't matter where they originate from," Samuel says of such websites and travel retailers.

"If they're carrying on business in Australia and it relates to their Australian business, then they'll have to comply with the law."

By Clive Dorman

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