Guidance in relation to cancellations caused by COVID-19 restrictions.
Posted on 27.05.2020
Many local outdoor recreation and sporting clubs have been required to suspend, shorten or cancel their 2020 sporting seasons, and may be struggling to manage membership cancellation requests and to manage the financial implications of the COVID-19 pandemic. That said, many consumers are also experiencing financial hardship at this time and so it is important to recognise and balance the concerns of both local clubs and consumers.
The Australian Competition and Consumer Commission (ACCC), mindful that local and community sporting clubs or associations have been directly impacted by government restrictions imposed due to COVID-19, has outlined its expectation that appropriate remedies will be provided to consumers where sporting seasons have been suspended, shortened or cancelled, as required by law.
The ACCC has also published guidance for consumers regarding their rights to remedies for suspended, shortened or cancelled seasons.
In a recent letter to National and State sporting (read ‘active recreation’) organisations, the ACCC outlined the obligations these organisations have to consumers … read letter.
The most relevant obligations for sporting organisations during COVID-19 include:
- Organisations must honour the terms and conditions of their policies with consumers, including any applicable financial hardship policies, and must not mislead consumers regarding their entitlement to remedies under their contract;
- Organisations cannot seek to rely on any unfair terms in their standard form contracts with consumers.
- Organisations must meet their consumer guarantee obligations under the ACL, to provide services with due care and skill, and ensure that the services provided are fit for the purpose they were acquired for.
Consistent with the above, the ACCC expects that:
- If sporting seasons are cancelled, consumers should receive a refund or other remedy, such as a credit note or voucher for a future season, in most circumstances.
- If sporting seasons are suspended, consumers should be offered a refund or a credit note or voucher for the period that the season is suspended. If consumers accept a credit note or voucher, this should be applied when the 2020 season recommences, or to a future season if the 2020 season remains cancelled.
- If sporting seasons resume but are shortened or altered, consumers may still be entitled to a remedy such as a partial refund, credit note or voucher where the value of the service has been reduced. However, whether consumers are entitled to a remedy will depend on the particular circumstances of the revised season, any applicable terms and conditions of membership, and what consumers receive in exchange for their membership fees. For example, funds paid toward uniform, equipment or insurance costs may be non-refundable given they cover the duration of the season or registration, irrespective of the season length.
The ACCC has also published guidance for consumers to help them understand their rights in relation to suspended, shortened or cancelled sporting seasons (available here: https://www.accc.gov.au/consumers/consumer-rights-guarantees/covid-19-coronavirusinformation-for-consumers).
In an attachment to the letter mentioned above the ACCC addressed several key situations where consumers rights maybe compromised.
The ACCC hopes that the gradual easing of social isolation may ease some of the current financial and administrative issues faced by Australia’s sporting bodies and help ensure the continued viability of the local and community sport and recreation sectors post-COVID-19.
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