Jetstar in 'opt out' pricing probe

Under the formal agreement signed this week, Jetstar has made court enforceable undertakings to change its conduct on its website by April 30. Photo / Greg Bowker

Jetstar is under investigation by the Commerce Commission over its use of "opt-out pricing" on the airline's website.

Air New Zealand faced a similar investigation over the practice in January in relation to the way insurance was automatically selected for customers booking tickets on the airline's website and mobile app.

The Air New Zealand investigation resulted in the Commerce Commission issuing a formal warning, and the airline has since suspended the practice.

Commerce Commission spokesman Christian Bonnevie today confirmed to the Herald that an investigation into a similar opt-out practice by Jetstar had been underway since the beginning of the month.

"It's in the early stages so all we can say at this stage is that there is an investigation happening."

The investigation was instigated by the commission and not from a complaint from a member of the public, Bonnevie said.

It was unknown how long the investigation would take, he said.

A Jetstar spokesman said in a statement that checked baggage, seat selection and travel insurance were all pre-selected during its booking process.

"Jetstar is a low cost carrier and our pre-selected options are in line with other low cost carriers worldwide."

The pre-selected items on Jetstar's website were all are clearly displayed and easy to deselect, he said.

"Pre-selection can alert travellers to services such as travel insurance or checked baggage that they may not have considered.

"If they don't want to purchase a pre-selected product they just tick a button and continue with their booking.

"We believe our pre-selection processes comply with all laws and we are explaining our position to the Commerce Commission."

A screen grab of Jetstar's website showing the automatically selected insurance charge.

A screen grab of Air NZ's website showing the insurance charge is no longer automatically selected.