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​ACCC issues warning to foreign companies off the back of Valve decision

The Australian watchdog has used the Valve decision to warn online traders operating overseas that they must comply with the Australian Consumer Law when offering goods and services down under.
Written by Asha Barbaschow, Contributor on

The Australian Competition and Consumer Commission (ACCC) has extended a warning to international organisations selling goods and services in Australia that they must comply with the country's Consumer Law.

"Under the Australian Consumer Law, all goods or services supplied to consumers come with automatic consumer guarantees that they are of acceptable quality and fit for the purpose for which they were sold," ACCC Acting Chair Dr Michael Schaper said. "If they're not, consumers have a right to a remedy. These consumer rights cannot be excluded, restricted, or modified."

The comments come after the Federal Court ordered US-based video game distributor Valve Corporation pay penalties totalling AU$3 million for breaching the Australian Consumer Law.

"These proceedings, and the significant penalties imposed, should send a strong message to all online traders operating overseas that they must comply with the Australian Consumer Law when they sell to Australian consumers," Schaper said in a statement Tuesday.

"We will continue to take action to ensure Australian consumers benefit from these Australian Consumer Law guarantees, regardless of whether the business which supplies them is based in Australia or overseas."

The watchdog launched proceedings in the Federal Court against Valve in August 2014, alleging that Valve made false or misleading representations regarding the application of the consumer guarantees under the Australian Consumer Law.

Despite previously calling for mediated talks directly with the ACCC, the Federal Court of Australia found in March last year that Valve had breached the Australian Consumer Law by making false or misleading representations to consumers in relation to its online game distribution platform, Steam.

Based in Seattle, Valve owns and operates Steam which claims over 125 million users worldwide. Despite claiming approximately 2.2 million users in Australia, Valve sells computer games through Steam to Australian customers, but does not have a physical presence in the country.

In handing down its AU$3 million decision at the end of last year, the Federal Court found that the terms and conditions in the Steam subscriber agreements, and Steam's refund policies, included false or misleading representations about consumers' rights to obtain a refund for games if they were not of acceptable quality, the ACCC said.

Additionally, the Federal Court ordered Valve to publish information on Australian consumer rights on its website for 12 months, implement a consumer compliance program for its system and staff, and not make any similar representations to Australian consumers for three years.

According to the watchdog, in 2015, Valve's revenue was reported at over $3 billion.

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