ACCC commences subscription trap proceedings against HelloFresh, Youfoodz

The context: The ACCC alleges the two entities misled consumers over subscriptions under Australian Consumer Law by advertising that new customers could easily cancel subscriptions through online account settings before a specified cut off date.

However, many customers that tried to cancel prior to the first delivery cut-off time were still charged and received the first order. Despite an easy sign up, customers could only cancel their first delivery by speaking with customer service.

The consumer watchdog also alleges that payment details were required during the sign up process but it was represented that they would not be charged unless selecting a meal from the menu. However, they were signed up for an ongoing subscription and charged for the delivery upon progression.

It also alleges that Youfoodz informed clients who had cancelled their subscription through online account settings that they would not be charged, when the first delivery couldn’t be cancelled in this way.

What they said: “We’ve brought these two cases because we allege that HelloFresh’s and Youfoodz’s conduct involved a suite of confusing and unclear subscription practices in breach Australia’s consumer laws,” ACCC Commissioner Luke Woodward said.

“Despite what HelloFresh and Youfoodz represented to new Australian subscribers, tens of thousands of consumers were charged for their first order, even though they cancelled their subscription before the cut-off date.”