What was the allegation made by the Canadian Competition Bureau against Avis Budget Group and its subsidiaries regarding Budget rentals in Canada?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
Budget Group paid $6,700,000 in legal fees and $2,700,000 in settlement costs.
Canadian Competition Authority. In March 2015, the Canadian Competition Bureau filed an application with the Competition Tribunal alleging that ABG and two of its Canadian subsidiaries engaged in deceptive marketing practices with regard to certain charges that consumers are invoiced related to renting a vehicle and associated products in Canada. The application sought penalties against ABG and its subsidiaries totaling approximately $25 million as well as reimbursements to current and former customers of amounts collected and retained by ABG related to the alleged deceptive marketin
Source: Item 3 — LITIGATION (FDD pages 12–16)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, in March 2015, the Canadian Competition Bureau filed an application against Avis Budget Group (ABG) and its Canadian subsidiaries. The allegation was that ABG engaged in deceptive marketing practices related to certain charges invoiced to consumers for vehicle rentals and associated products in Canada.
The Canadian Competition Bureau sought penalties against ABG and its subsidiaries totaling approximately $25 million. They also sought reimbursements to current and former customers for amounts collected and retained by ABG due to the alleged deceptive marketing practices.
The case was settled on June 2, 2016, with ABG paying $3.25 million. This indicates that while the initial allegations were significant, the final settlement amount was substantially lower than the initially sought penalties.