The Australian Competition and Consumer Commission has found that Valve Corporation has “engaged in misleading or deceptive conduct” through Steam. The company made “false or misleading representations” to Aussie consumers about refunds and guarantees under Australian Consumer Law, and the consumer watchdog is not happy.

The case has taken more than a year and a half to come to this result, with the ACCC suing Valve back in August 2014. At the time, a Valve spokesperson told Player Attack the company was “making every effort to cooperate with the Australian officials on this matter”.

The breaches came in the terms and conditions in not one, but two versions of the Steam Refund policy and three versions of the Steam Subscriber Agreement.

Valve claimed that:

consumers were not entitled to a refund for digitally downloaded games purchased from Valve via the Steam website or Steam Client (in any circumstances);

Valve had excluded statutory guarantees and/or warranties that goods would be of acceptable quality; and

Valve had restricted or modified statutory guarantees and/or warranties of acceptable quality.

The Australian Federal Court’s Justice Edelman decided that – because each of these representations involved conduct in Australia by Valve (and Valve was therefore conducting business in Australia), these claims fell under – and breached – Australian Consumer Law.

ACCC chairman Rod Sims explains that the Federal Court’s decision reinforces that companies selling goods and/or services to Australians must adhere to Australian Consumer Law.

In this case, Valve is a US company operating mainly outside Australia, but, in making representations to Australian consumers, the Federal Court has found that Valve engaged in conduct in Australia. It is also significant that the Court held that, in any case, based on the facts, Valve was carrying on business in Australia.

Importantly, this Federal Court decision is a landmark case that sees the definition of “goods” in the ACL expanded to include “computer software”. This, says Mr Sims, will “provide greater certainty” in future cases relating to digital goods and online platforms.

Consumer issues in the online marketplace are a priority for the ACCC and we will continue to take appropriate enforcement action to hold businesses accountable for breaches of the ACL.

Liability is yet to be determined, but Valve will have to pay its own legal costs – and potentially up to 75% of the ACCC’s, also.