Aussies being ripped off, price gorging and the ACCC.

G'day all,

As a big time cruiser I am getting more and more incensed by the big cruise lines coming down here to Australia expecting our patronage and loyalty while at the same time having a discriminatory pricing model that means that Australians are more times than not, being charged 'significantly more' than residents of north America.

By significant I refer to price gorging which in many cases represents thousands of dollars on what they expect Australians to pay compared to people who book from the USA.

And I'm talking here about comparing apples for apples, for exactly the same ship, itinerary and cabin category. And this price gorging is even happening on cruises that don't even touch Australian ports.

After several long chats to the ACCC help line I have determined that there are specific instances where the cruises lines are currently in breech of Australian corporate and competition law.

In other instances where their pricing policies are technically within the law they only get away with such practices because they figure that most Aussies won't actually be smart enough to figure out what they are doing - and even if we do, they have obviously made a calculated decision that there is not much we can do about it even if we do find out.

Well I'm here to tell them otherwise.

Someone once told me that sunlight is more times than not, the best medicine. And that's what I intend to do here, shine light on the dirty little secrets the cruise lines are hiding from Australians.

I want to use this thread to document the current (legal but dubious) price gorging practices of these cruise lines and more importantly get solid evidence of illegal practices that we can forward to the ACCC so that they can take action on our behalf.

This is the course of action recommended to me by the ACCC. Documentation will help them take action and obviously the more we can assemble the better.

Over coming days I will be posting here exact details of the current legislation.

My understanding of the law is that many people who have booked cruises over recent years from Australia and who have suffered a loss due to polices/procedures that are in breech of legislation could well be entitled to a refund.

A significant one.

More here shortly when I have time away from day job to start documenting the legislation and specific examples where the law has been breeched.

G'day all,

As a big time cruiser I am getting more and more incensed by the big cruise lines coming down here to Australia expecting our patronage and loyalty while at the same time having a discriminatory pricing model that means that Australians are more times than not, being charged 'significantly more' than residents of north America.

By significant I refer to price gorging which in many cases represents thousands of dollars on what they expect Australians to pay compared to people who book from the USA.

And I'm talking here about comparing apples for apples, for exactly the same ship, itinerary and cabin category. And this price gorging is even happening on cruises that don't even touch Australian ports.

After several long chats to the ACCC help line I have determined that there are specific instances where the cruises lines are currently in breech of Australian corporate and competition law.

In other instances where their pricing policies are technically within the law they only get away with such practices because they figure that most Aussies won't actually be smart enough to figure out what they are doing - and even if we do, they have obviously made a calculated decision that there is not much we can do about it even if we do find out.

Well I'm here to tell them otherwise.

Someone once told me that sunlight is more times than not, the best medicine. And that's what I intend to do here, shine light on the dirty little secrets the cruise lines are hiding from Australians.

I want to use this thread to document the current (legal but dubious) price gorging practices of these cruise lines and more importantly get solid evidence of illegal practices that we can forward to the ACCC so that they can take action on our behalf.

This is the course of action recommended to me by the ACCC. Documentation will help them take action and obviously the more we can assemble the better.

Over coming days I will be posting here exact details of the current legislation and then we will use this lobby the ACCC to take action.

My understanding of the law is that many people who have booked over recent years from Australia and who have suffered a loss due to polices/procedures that are in breech of legislation could well be in titled to a refund.

A significant one.

More here shortly when I have time away from day job to start documenting the legislation and specific examples where the law has been breeched.

Without getting into the details, is it because the OZ cruise fares contain the $11 a day service charges, whilst the US ones do not?

Sometimes look at the laws in your country

1 - do prices have to include fare , fees , taxes , gratuities etc in the quoted price ? This could make a big difference in price

2 - If not all charges are collected , do Australians tip wait staff or not.

3 - Ships based in Australian don't have the daily gratuity added that is common in NA , Europe , Asia and SA.

Also OZ taxes are higher.

In addition to the questions raised above, there is a whole different corporate tax structure in Oz, as well as a consumer protection system that we here in North America don't have. These things cost money, the cruiselines have to pay which is reflected in the fares the cruise lines charge.

I look at the pricing issue this way, if there is a service and a product that I want and it is at a price I am prepared to pay, I'll buy it. If the product or service is priced at a point I don't like, I don't buy it.

A cruise is not a life saving drug, it is not a necessity of life, it is a vacation choice. If I don't like the price, I don't buy it. Simple as that.

The cruiselines are a business. Their shareholders demand the best return on investment possible and if the ships based in Oz can't meet the profit expectations of the cruiselines they will relocate to a market where those profit expectations will be met. As a consumer, it is your call, buy the product or don't buy the product but expecting them to sell it to you at your price is probably setting yourelf up for disappointmet.

One other area is that laws in Australia require travel agent participation in programs that provide more protections than are required in the US.

Travel Compensation Fund

The TCF was set up in 1986 as part of the introduction of the

National Scheme. It is the primary body by which consumers are

protected against financial losses arising from the financial collapse

of a registered travel agent.

The licensing rules in the National Scheme require participation in

the TCF as a precondition for being licensed. The fund’s purposes

are:

 to ensure that only persons who have sufficient financial

resources may join, or continue to participate in, the fund and

therefore may carry on business as a travel agent, and

 to provide compensation to eligible consumers who have

suffered financial loss as a result of the bankruptcy of

registered travel agent.

This is one of the drivers in pricing between the US and Australia. There are others. Thus travel purchased through an Australian travel agent will be higher than through a US agent because the the differences in protections (similar difference exist in the UK).

As I understand it the changes to prevent people from Australia from purchasing cruises from US travel agents was largely driven by the Australian travel industry. Because they could not compete with US travel agents because of the difference in consumer protection laws.

So I doubt you will be successful because you really cannot have it both. The protections offered by Australian consumer travel laws and the ability to buy from the US where the same protections are not part of the law.

Without getting into the details, is it because the OZ cruise fares contain the $11 a day service charges, whilst the US ones do not?

No.

I always calculate the daily rate of any cruise, including recommended gratuities, to calculate the value of any cruise offer. US are offered much better deals on the same cruise, than Australians, even when the cruise is overseas.

After thinking about it a bit I want to ask the following question.

If a US consumer book through a US agent then clearly US law applies.

If a Australian consumer books through an Australian agent then Australian consumer laws apply.

The contracts written between the cruise lines and the travel agents are written to keep these relationships clear. US agents are not supposed to book non-US consumers.

If an Australian consumer books with a US agent then which countries consumer protection laws apply? If the cruise lines contracts are not written to keep the purchases local, then such a company that does business around the world can get into rather murky areas very quickly and may run a foul of a number of problems with such differences in consumer laws.

We (and a few hundred other Aussies) booked a 49 night cruise on the Grand Princess out of Fort Lauderdale. Obviously everyone on board will have to pay the daily tip. The American price was '+ port fees' where the price for Aussies was a flat amount that was lower than the US total price. Several Aussies were complaining that our price was higher until I pointed out that they had to read the fine print and add the $615 port fees. They stopped complaining then, but didn't say "Gee, it isn't fair that we Aussies are getting the cruise cheaper than the Americans". :)

From what I have seen on other occasions, Americans booking Australian cruises pay more than we do and often we pay more than they do when booking American cruises - although we have one cruise where that isn't the case.

When putting information together take care that you are not comparing the brochure price available to passengers well ahead of the cruise with a 'special' price offered to sell unsold cabins.

Several Aussies were complaining that our price was higher until I pointed out that they had to read the fine print and add the $615 port fees. They stopped complaining then, but didn't say "Gee, it isn't fair that we Aussies are getting the cruise cheaper than the Americans". :)

Yes, I've always wondered about that.

Prices are lower and higher in all markets, for different discounting reasons. This applies to things aside from cruises as well, e.g. Harvey Norman might have a bonus pack for some device that other retailers don't, or a close-out bargain way cheaper than anyone else. The same even applies to supermarkets too where you see some special pack exclusive to Coles or Woolworths. The amounts at supermarkets may be smaller, but the principle is the same. Thus, I don't see the issue. Unless people want a Soviet style control economy where everyone pays the same???

The only issue I see is that some companies put up restrictions that make it hard for people to shop elsewhere. This is not unique to cruising either though, Other suppliers like Sony, Apple and Dell do similarly. That said, there are different regulations, taxes and customer protection laws and standards - and even customer practices such as tipping in the case of cruising - between regions so it's not a like for like comparison, and there are some justifications.

You're right, IRate. The same applies to cruisers who book from the UK, though the difference is much smaller.

But from experience on these boards I doubt you'll get much sympathy from your US cousins.

Kamloops - the huge differences are for cruise-only, airfares aren't a factor.

UK prices do include port fees, but they're responsible for only a tiny proportion of the difference.

Gratuities/service charges relate to the cruise & not to the nationality/residence of the cruiser - an Aus, a Brit & an American will all be charged the same for service And I believe the daily charge can be removed, by any cruiser, on any US ship.

Consumer protection is an oft-quoted excuse.

But if that were a major factor, prices to EU residents would be higher than to Aus residents.

And payment by credit card gives the same protection - at a cost of around 2 to 3%. If the credit card industry is happy to carry the risk at a 2 - 3% margin, then at worst the extra cost to non-North Americans should be the same.

Cruise lines require Brits to have travel insurance, which also reduces their own liability. Am I right in believing that US citizens are not obliged to carry insurance?

I think RDC1 has hit the nail on the head by citing the influence of Aus T/A's.

I think that's a very significant factor, perhaps the only significant factor. And I suspect the same applies to UK T/As. Not because of the extra consumer protection, but because of protectionism toward the T/As - the cruise lines want to keep them sweet, because of the volume of business that they provide.

When I was in business, I was affected by Coca-Cola's protectionism toward local franchisees, they attempted to prevent franchisees from selling to countries outside their patch - that protectionism was deemed by the courts to be illegal.

But anti-competetive practices are a legal minefield.

RCD1 mentions that "US agents are not supposed to book non-US consumers". Its the cruise lines who instigated this rule, and it doesn't apply to all US cruise lines.

(the ruling relates to residency, not nationality - so presumably doesn't break any laws on racial equality, though that's another one for the legal beagles)

Good luck, IRate.

But I'm with Wpg.

I vote with my feet.

I cruise mainly UK cruise lines, & I'm tempted by US lines only when they offer cheap last-minute deals.

JB :)

Princess was having problems with staffing the Australian cruises since many were removing the autotip and not giving cash tips. So for Australians, the dropped the autotip and increased the fare.

This whole issue certainly needs to be addressed, especially now the cruiselines have woken up to the fact that the Aussie market still waits to be tapped and cruises operating out of Oz have the potentially vast Asian customer base waiting in the wings. The strong Aussie dollar helps to a certain extent but the whole price structure and the restrictions we face is inequitable to say the least.

We just booked our cruise with RCI out of Sydney via the US. It is a bit ($250 or so) cheaper for the same cabin level but there were a better range of cabins available from the US agent, I rang the Aussie agent first. We booked our last Feb Carnival cruise via the US as well. The Carnival agents in Australia would not provide the same pricing, the difference in this instance was $500 +. On the same trip we were forced to book American Airlines flights via the .au website and it was several hundred dollars more expensive, lower category tickets (for status credits) and premium seating that was available via the US site was not available on the .au one. We are definitely being ripped off.

Edit to add. I am not sure where the free trade agreement sits with all of this.

First thing to consider is that MANY of the cruiselines redirect Aussies to an "Aussie only" website when they try to access a ****.COM website.

EG Cunard.com redirects to Cunardline.com.au and Royalcaribbean.com redirects to Royalcaribbean.com.au.

Prices on these websites are shown in AUD - and the exchange rate to do this is not current. The Australian office of P&O uses an exchange rate for purchases of product from P&O UK which is grossly disadvantageous to Aussie customers.

Barry

Kia ora,

There was an earlier thread on this same theme. I too have had experience (with Princess) whereby I was charged more on an 'apples for apples' basis for a Northern Hemisphere cruise than if I was booking in America & paying in American dollars (which I was unable to do). I would also point out that taxes/port charges apply no matter what! The justification Princess gave was the cost of conducting business in Australia. Posters on other threads say that they have struck this problem with a number of cruise lines! I will be interested to read the outcome of Commerce Commission or similar enquiry.

Aquarians

G'day all,

 

As a big time cruiser I am getting more and more incensed by the big cruise lines coming down here to Australia expecting our patronage and loyalty while at the same time having a discriminatory pricing model that means that Australians are more times than not, being charged 'significantly more' than residents of north America.

 

By significant I refer to price gorging which in many cases represents thousands of dollars on what they expect Australians to pay compared to people who book from the USA.

 

And I'm talking here about comparing apples for apples, for exactly the same ship, itinerary and cabin category. And this price gorging is even happening on cruises that don't even touch Australian ports.

 

After several long chats to the ACCC help line I have determined that there are specific instances where the cruises lines are currently in breech of Australian corporate and competition law.

 

In other instances where their pricing policies are technically within the law they only get away with such practices because they figure that most Aussies won't actually be smart enough to figure out what they are doing - and even if we do, they have obviously made a calculated decision that there is not much we can do about it even if we do find out.

 

Well I'm here to tell them otherwise.

 

Someone once told me that sunlight is more times than not, the best medicine. And that's what I intend to do here, shine light on the dirty little secrets the cruise lines are hiding from Australians.

 

I want to use this thread to document the current (legal but dubious) price gorging practices of these cruise lines and more importantly get solid evidence of illegal practices that we can forward to the ACCC so that they can take action on our behalf.

 

This is the course of action recommended to me by the ACCC. Documentation will help them take action and obviously the more we can assemble the better.

 

Over coming days I will be posting here exact details of the current legislation and then we will use this lobby the ACCC to take action.

 

My understanding of the law is that many people who have booked over recent years from Australia and who have suffered a loss due to polices/procedures that are in breech of legislation could well be in titled to a refund.

 

A significant one.

 

More here shortly when I have time away from day job to start documenting the legislation and specific examples where the law has been breeched.

OK, I'm new to this so that do I know. But if you rightly or wrongly feel that cruise lines are ripping off Australians, why on earth do you patronize them? Legislation isn't necessary. Close your wallets. Why make it profitable for them to continue this practice?

I know Carnival sent a ship down this yr and prices are higher- but thats in part because apparently Australians don't do tips.

I am an American lawyer. Let me start off by saying that I want to pay as little for the cruise as possible. That being said its going to rare when you actually pay the least amount for the cruise for a number of reason(where you book and when you book are two of them). As most people know on a airline for instance there may be as many fares as passengers..and some of that may be based on where people reside..perfectly legally.

The laws about anti-trust are similar and the agency rules are similar among the various countries. Consumer protection laws and rules concerning which TA you can use are not. These are mostly specifically statutory(local laws) and how they apply varies greatly. The example concerning Coke just does not apply here. The cruise line sell through travel agents or directly. The cruise line can tell its agents what price they can sell and its not an anti-trust issue at all because its isn't the TA that is selling the TA's product. They are making a booking for the cruise line and the cruise line is paying them a commission. Coke sells the syrup to the local bottling company. The bottling company pays a set fee for the syrup and then can sell for any price it wants the final product not so the TA. The risk of loss is with the bottling company. The antitrust issue for the bottling companies which are independent entities deals with their right to compete with other independent bottling companies. The restriction on territories may violate that anti-trust rule.

Many countries and states have rules concerning the registration or licensing of TA's. I believe at least one of the Australian states/territories has such a registration requirement. In most cases while this also protects the TA the primary purpose(traditionally) has been to protect the local consumer from fly by night and unscrupulous TA's. Many US states require licensing or registration to sell to citizens of those individual states-there is no national licensing law here and some states have no such requirement.(California has and you will see on most national US TA sites a registration number-I believe Florida does too). Every US state has a requirement that if the cruise line or TA sell insurance(cruise insurance for instance) that the insurance company be licensed in that state and the cruise lines use a insurance company that is actually licensed in every state for all insurance they sell except for cancel for no reason insurance which they self insure-its technically not insurance but a waiver of the penalty for cancellation. In any case these all were at least in major part done to protect that state's citizens from loss...not to protect the TA although that may be a byproduct of such a law.

Yes I know that the cruise contract has a choice of law provision and place where the lawsuit must be brought but if the cruise contract is in violation of the local consumer protection law these contract terms which violate the local public policy-in the consumer protection laws will NOT be enforced. As An example lets say the local state has a law that requires that the TA be licensed and the cruise company sells to individuals in that state through TA's not so licensed. The State can and has sued the cruise companies to stop and they for the most part do. The Florida Attorney general has aggressively sued the cruise lines when he feels that they are violating consumer protections(as they did when the cruise lines retroactively tried to enforce fuel surcharges that had not been expressly reserved).

Most cruise lines(not all) don't allow US TA's to sell to cruiser who reside in Europe or other places and those prices to those residents tend to be higher precisely because of consumer protection laws. When the Iceland volcano exploded the European protection laws required that the people who bought a complete cruise including airfare through the cruise line had to be gotten to the cruise no matter what the cost and the damages for failure to do so where not limited to the cost of the cruise airfare and any additional cost to get there. US cruisers even with insurance were on their own and could only recover limited damages...not so the European consumer.

Its also still true that 90% of all bookings on cruise still come through some form of TA and the cruise lines rely upon them greatly. As many people know the cruise lines have been restricting TA's splitting the commission with the cruiser. Many have made it extremely little they can split with the cruiser. They can do this precisely because they can control their agent and its not an antitrust issue at all(as long as its an individual cruise line decision its ok if the Cruise lines agree among them to restrict it it would not be okay because that is an anti-trust issue an agreement between two independent entities to restrict payments to others would surely violate anti-trust laws but a TA(an agent) and a cruise line(the principal) is not two independent entities.).

Of course this is all legalese. The ACCC help line may believe there is a specific legal violation but that doesn't necessarily make that so. I assume like most departments that don't win every case. I assume if they believed that there was a specific violation they would have told them to stop a long time ago..

and finally even though the number of Australians cruising has increased, it still represents a small faction of those cruising(under 5%)...remember these cruise ships are mobil can be easily repositioned..

I'm keeping an eye on this thread.

If it's any consolation, there's varied pricing even within the US. Residents of certain states may get preferential pricing over residents from other states. Good example, there's often really great rates for Florida residents. Unfortunately I only have a Tennessee ID.

All the major cruise lines practice Differential Pricing in Australia for the same cruises sold in the US and Canada for usually much lower fares .

It is like the marketing nonsense that goes on with brochure and launch fares which no one ever really pays . So Caveat Emptor - BUYER BEWARE.

It is illegal in Australia to quote a travel price and then add on extras like tipping, port charges etc .(The fare quoted must be the final total fare including all hidden and compulsory on charges.)

The ACCC has juristiction only within Australia so it is illegal for a Cruise line to dictate to any seller what price he must sell that product at .

There is supposedly a FREE Trade Agreement between the USA and Australia, and some smart cruiser should query whether retail price maintenance and refusing to sell to Australian customers is a breach of that free trade agreement .

The only issue I see is that some companies put up restrictions that make it hard for people to shop elsewhere. This is not unique to cruising either though, Other suppliers like Sony, Apple and Dell do similarly. That said, there are different regulations, taxes and customer protection laws and standards - and even customer practices such as tipping in the case of cruising - between regions so it's not a like for like comparison, and there are some justifications.

The restrictive redirection of Australian customers to AU marketing sites across a range of consumer products was reported in the Financial review earlier this year - taken up a little at the time in the wider media but largely glossed over - Radio National did give it a run. It will be interesting to see if any enquiry promised by the Australian Government extends to the Cruise Industry.

Hello,

I live in Switzerland, and I have the problem that sometime the same cruise is offered in Germany at a much lower fare. It is no problem for us to book through a German cruise agency to get the German rate!! This should also apply for Australians?

Although, I am realizing that the cruise lines are waking up in Switzerland, I have seen some really good deals recently. I booked a cruise with MSC, and exceptionally, the Swiss price was even lower than the German price. We need to educate the cruise lines by booking in a foreign country, if the price is cheaper there. Cruise lines in the respective countries are well aware that they may lose bookings with cross-border business.