Sydney Morning Herald and Channel Nine owner Nine Entertainment have been fined $ 159,840 for charging customers excessive credit card fees.
The Australian Competition and Consumer Commission slapped Nine on Friday with 12 separate infringement reports, claiming it overcharged about 220,000 subscribers, on average, $ 1.92 each.
Customers who bought from Nine Advertising were overcharged by about $ 1.80 on average, according to the ACCC.
Total refunds from six subsidiaries are expected to be $ 450,000, but some customers will have subscriptions renewed instead of cash.
The ACCC said it was concerned that after purchasing Fairfax Media in December 2018, Nine had started overbilling its subscribers. However, it only penalized the company for surcharges levied in the five months leading up to December 2020.
Nine Entertainment owns Channel Nine and print imprints such as The Age, The SMH and The Australian Financial Review.
Subscribers to these mastheads who paid with MasterCard or Visa received card fees of 0.9-1.55 percent, which exceeded the cost of Nine by 0.09-0.84 percent.
“A payment surcharge is excessive and illegal if it exceeds the cost of processing the payment,” said ACCC vice chairman Mick Keogh on Friday.
“While the average markup per consumer was relatively small, it added up to a significant amount given the number of transactions Nine processed.”
A spokesman for Nine said the inflated surcharges were unintentional.
“We accept the ACCC’s findings on this matter and have paid the fine,” they said.
“The award was unintentional, it wasn’t a bug that affected all nine (for example, Stan and Future Women were unaffected), and we have taken steps to credit the affected subscribers and advertisers.”
Nine has removed the surcharges for subscription payments for Visa and MasterCard debit payments and limited the surcharges for credit cards to 0.5 percent.
Other large companies such as Fitness First, Red Balloon and Europcar have been fined by the ACCC for excessive card surcharges over the past four years.
The ACCC first contacted Nine in 2020 and asked them to review their surcharge rates. That led the company to find that subscribers were paying too much.
The New Daily believes that Nine has not updated its surcharge fees annually, resulting in higher-than-cost fees between December 2018 and December 2020.
“This should remind companies that the ACCC will continue to investigate complaints about companies that impose excessive surcharges,” Keogh said on Friday.
“Nine has since changed its payment surcharges to meet the RBA standard for excessive payment surcharges.”
The violations were reported to Fairfax Media Management (subscriptions); Nine Radio Operations Pty Ltd (advertising); Fairfax Media Publications Pty Ltd (advertising); and NBN Pty Ltd, Nine Digital Pty Ltd and Nine Network Australia Pty Ltd (advertising).