NSW Government announces new laws on ticket scalping

NSW’s Fair Trading Minister Anthony Roberts has announced new laws to protect consumers from ticket scalping and ticket fraud when buying tickets to major concert, entertainment and sport events.

Sellers will have to show proof that the ticket exists, and that the resale price not be 10% over original price. The Government acknowledges that fans have legitimate reasons to sell their tickets. But if these breach conditions, websites can be ordered to remove them from sale – or face fines of up to $5500.

“These new laws will improve transparency in the marketplace, protect consumers and allow the event organiser to enforce their terms and conditions to protect genuine fans from ticket scalping and fraud,” he said.

In many cases, Roberts pointed out, fans are being sold tickets that do not exist. “Even if a purchased ticket is genuine, the ticket may still be worthless, if the event owner cancels the ticket for being resold in breach of its terms and conditions. Often the perpetrator simply disappears leaving the consumer out of pocket.

“Event organisers find that scalpers profit despite bearing no risk in staging a major event. Event organisers have tried to address ticket scalping with varying success by allocating tickets to sporting clubs, limiting the number of tickets that can be bought by any one person and staging the release of tickets.”

The new laws will require anyone reselling tickets to include information in their ads to include a legible image of the ticket showing the ticket number, row and seat number (but with the barcode obscured so it can’t be copied); details of the terms and conditions of sale of the ticket, or details of where to find them (for example, on a website); and notice of any condition which allows the ticket to be cancelled if it is resold in breach of its terms and conditions. If a ticket to a NSW event is subject to a condition allowing it to be cancelled, the ticket will need to have a warning on the front.

The law will not apply to if a ticket is sold through a resale system that is publicly authorised in writing (for example, on a ticket or website) by the event owner. The NSW Government has been consulting with promoters, sports bodies, ticketing companies and reselling facilitators for 12 months.

Michael Gudinski, managing director of the Frontier Touring Company applauded the introduction of the laws. “For too long scalpers have been able to hide behind anonymity online,” he said. “Music should empower and real artists do not want to see their fans ripped off.”

Ticketek Australia managing director, Cameron Hoy, said that scalping eroded consumer confidence, and that “Ticketek welcomes the NSW Government reforms in this area and supports measures such as these to clamp down on this unsound practice.”

But not everyone agrees that the new legislation will solve the problem.

Christoph Homann, managing director of Resale for Ticketmaster International said the legislation “will neither protect fans nor stop scamming. Restrictions rarely stop consumer interest rather; it pushes them into back alleys or in the case of ticket resale to the online equivalent to offshore, unregulated websites and into the clutches of fraudsters.” He added consumers would not be protected from fraudsters who operate outside state borders.

Homann believes the industry must take the lead. “The ticket resale platform that we announced last month will create a resale marketplace that will provide clear transaction terms, a money back guaranteed and industry leading anti-scalping and anti-fraud measures. Fans will be able to transact with confidence in this marketplace that is a proven approach as it is deployed in the States and the UK.”

Both Alex Levenson, head of viagogo Asia Pacific and Megan English, spokesperson for eBay Australia and New Zealand, warned that the new laws protect promoters and primary ticket sellers, but not the fans. English commented that the real issue is the distribution of tickets, fees added to the final price of tickets and consumer refunds.

Roberts estimates that while the U.S. secondary market is worth over $5.6 billion, it is between $200 million and $400 million in Australia.