Uber Fined $21 Million For Misleading Fares And Cancellation Fees

The Federal Court has fined ride-share service Uber $21 million over misleading fare estimates and cancellation warnings.

The company will pay the fine after admitting it overestimated fees for services, and advertised a potential cancellation fee that wasn't charged.

It's approximately $5 million less than the proposed fine by Australian watchdog regulator, after taking the ride-share giants to court in April over deceptive practices.

Handing down the fine, Justice Michael O'Bryan said the evidence against the company was grossly inadequate, and settled on the appropriate amount instead of a proposed $26 million.

"It left the court in the position of speculating whether any harm was suffered (by consumers) and if so, whether it was significant or trivial," he said.

Uber conceded it mislead customers in two instances, relating to the Uber Taxi service offered in Sydney.

The ride-share company said that between June 2018 and August 2020 it provided an estimated fare range, when the actual cost was significantly lower.

"It is important to estimate that Uber overestimated the fare at the time of booking and the consumer ultimately paid a lower fare," the judge found.

"The fare estimate was an overestimate approximately 89 per cent of the time."

In addition to the Federal Court fine, Uber will pay $200,00 to the Australian Competition and Consumer Commission's cost of prosecuting the hearing, and told to implement a program of compliance in accordance to the Australian Consumer Law.

ACCC chair Gina Cass-Gottlieb said the penalty reflected the importance of Uber's misconduct.

"This $21 million penalty clearly signals to businesses that misleading consumers about the cost of a product or service is a serious matter which can attract substantial penalties,” Cass-Gottlieb said.

“We took this important case because we understand that consumers rely on apps, like the Uber app, to provide accurate information to inform their purchasing decisions because they cannot independently check or monitor whether the information displayed is accurate."

The company has up to 30 days to pay the penalties.

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