ACCC hauls Amaysim’s energy arm to court
- 09 July, 2018 15:27
Click Energy — the electricity retailing arm of ASX-listed telco Amaysim — faces Federal Court proceedings brought by the Australian Competition and Consumer Commission.
The ACCC revealed today that it had launched legal action against Amaysim Energy over what the consumer watchdog alleged were false or misleading marketing claims.
The ACCC claims that between October last year and March, Click Energy told Victorian and Queensland consumers that they could receive 7 to 29 per cent discounts on its energy charges if they paid their bills on time.
However, the ACCC says, those discounts were applied to Click Energy’s market offer rate — which were higher than the power company’s standing offer rates.
“When compared with Click Energy’s standing offer rates, the discounts were much lower than advertised,” the ACCC’s chairperson, Rod Sims, said in a statement. According to Sims, in some cases there was no discount at all.
The ACCC head said that he believed the company’s conduct rated among the worst he had witnessed when it comes to retail energy marketing.
“The retail electricity market is too complex and opaque,” Sims said. “Customers need to trust that discounts and savings advertised by retailers are accurate so they can make informed choices about which products are best for them.”
In a statement Click Energy rejected the ACCC’s allegations and said it believes that it “has acted lawfully, ethically and in accordance with industry practice”.
“The ACCC’s allegations relate to legacy Click Energy products which are no longer offered to the public,” the statement said.
The company said it had cooperated with the ACCC throughout the investigation and worked to address the regulator’s concerns.
The legal action is a “disproportionate response,” the company said.
“Click Energy is a challenger brand in the market and is committed to providing customers with transparent and competitive energy offerings.”
The ACCC is seeking a range of penalties against the company, including a court order allowing Click Energy customers to exist their plans without facing any penalty.
Amaysim last month lost its chief executive, Julian Ogrin, after he departed the mobile virtual network operator for a role at Foxtel.
The telco’s co-founder, Peter O’Connell, took over as CEO from 1 July.
Amaysim acquired Click Energy for $120 million in May 2017.
In a statement accompanying the April 2017 announcement of the acquisition, Ogrin said: “The acquisition of Click is a highly strategic opportunity and a significant milestone in the evolution of our company.”
“Consistent with our goal of increasing relevance to the Australian household, we see energy as the most logical vertical to perfectly complement our existing suite of mobile and broadband products,” the then-CEO said.
In guidance provided late last month, Amaysim said it expected to end FY18 with between 190,000 and 192,000 energy customers.