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Competition watchdog seeks court order to stop online fashion retailer tricking customers with ‘subscription trap’

SINGAPORE — The competition watchdog said on Friday (Nov 29) that it has applied to the State Courts for an injunction to stop an online fashion retailer from tricking customers with an unfair practice known as a “subscription trap”.

In a media statement, the Competition and Consumer Commission of Singapore said that it had applied for the injunction against Fashion Interactive and its owner, Mr Magaud Oliver Georges Albert, to stop them using the “subscription trap” on the footwear e-commerce site, myglamorous.sg.

In a media statement, the Competition and Consumer Commission of Singapore said that it had applied for the injunction against Fashion Interactive and its owner, Mr Magaud Oliver Georges Albert, to stop them using the “subscription trap” on the footwear e-commerce site, myglamorous.sg.

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SINGAPORE — The competition watchdog said on Friday (Nov 29) that it has applied to the State Courts for an injunction to stop an online fashion retailer from tricking customers with an unfair practice known as a “subscription trap”.

In a media statement, the Competition and Consumer Commission of Singapore (CCCS) said that it had applied for the injunction against Fashion Interactive (FI) and its owner, Mr Magaud Oliver Georges Albert, to stop them using the “subscription trap” on the footwear e-commerce site, myglamorous.sg.

WHAT IS A ‘SUBSCRIPTION TRAP’?

In a “subscription trap”, customers are misled into signing up for a subscription when they make an online purchase, without being clearly informed of the subscription and its associated fees.

If customers do not cancel the subscription, typically within a grace period, they become liable to make a payment, or recurring payments, from their debit or credit cards without their knowledge or consent, the CCCS said in its media statement.

Consumer protection regulators worldwide have identified the use of “subscription traps” as an emerging problem in e-commerce, CCCS added.

WHAT HAPPENED HERE

The CCCS said that the Consumers Association of Singapore (Case) has received various customer complaints about alleged unfair practices carried out by FI since April 2016.

They alleged that they were charged a recurring monthly “VIP Club” membership fee ranging from S$49.95 to S$59.95 on their credit or debit cards, without their knowledge or consent, after they had made a purchase on myglamorous.sg.

From the design of the website, the customers were under the impression that they were making a one-off purchase of footwear, as details of the membership programme were hidden in fine print.

Following Case’s intervention, the CCCS said that the affected customers were able to obtain refunds for the charges made by FI to their credit or debit cards.

However, Case continued to receive new complaints about FI automatically charging customers recurring monthly membership fees without their knowledge or consent. In January this year, Case issued a consumer advisory highlighting the complaints against FI.

CONSUMERS, TAKE NOTE

The CCCS said that Case is the first point of contact for customers in obtaining redress or compensation for their purchases.

Those who have made online purchases on myglamorous.sg are advised to review their bank statements and approach Case should they encounter any difficulty in obtaining a refund from FI.

Alternatively, they can consider filing a claim at the Small Claims Tribunal, the CCCS said.

REMINDER FOR RETAILERS

In a reminder to retailers, the CCCS said that the use of “subscription traps” contravenes the Consumer Protection (Fair Trading) Act (CPFTA) here, which protects consumers against unfair trade practices.

Retailers are reminded that it is an unfair practice under the CPFTA to make a false claim, mislead a consumer, or take advantage of a consumer if the retailer knows or ought to know that the consumer is not reasonably able to understand the transaction or any matter related to it, the CCCS in its media statement.

It added: “Retailers should ensure that adequate information is provided to consumers. Any material information should be disclosed in a clear and prominent manner.”

Customers are also advised to exercise caution and read through terms and conditions listed on retailers’ websites carefully before making their purchases.

Those who would want to learn more about their rights as a consumer can visit www.case.org.sg/consumer_guides.aspx.

Related topics

CCCS Case Competition and Consumer Commission of Singapore e-commerce court

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