02.Cracking down on car-hire companies
Car-hire crackdown
As part of its investigation into the car rental industry, the ACCC started proceedings against Europcar Tasmania in November last year, alleging the company overcharged customers to repair damage and failed to refund overcharged amounts due to unfair clauses in contracts.
Linda Whittaker experienced a similar situation with Europcar Canberra. In September 2011 she paid $1305.12 to hire a Toyota Commuter van for eight days, which included a $283.60 peace-of-mind fee to limit damage liability to $990, as well as a 22% location surcharge, 3.5% administration fee and 1.5% credit card surcharge.
After one of the van’s windows was smashed by vandals, Linda sought quotes for repair before returning the van to Europcar and filing an incident form.
The following week, Linda’s credit card was charged $1270.71. Europcar had recalculated the total amount owing, adding the maximum damage liability to the vehicle hire so that the location surcharge (22%), admin fee (3.5%) and credit card surcharge (1.5%) were all calculated on the total of both these charges, with GST (10%) then added on top. Europcar charged Linda the maximum $990, despite her quotes to repair the window falling between $300 and $458.
A Europcar representative claimed the damage liability fee was subject to additional fees and charges before GST. Linda alleges Europcar failed to verbally disclose these details to her when selling the peace-of-mind protection.
Fortunately, under the new ACL Linda can lodge a complaint with the ACCC to resolve her dispute.