Regulator commences court proceedings against Sumo for allegedly unlawful door knocking and signing up customers without ‘explicit informed consent’

The Essential Services Commission has commenced civil penalty proceedings in the Supreme Court of Victoria against energy retailers Sumo Power Pty Ltd and Sumo Gas Pty Ltd (together, Sumo). 

In its statement of claim filed yesterday, the commission alleges that between 31 December 2021 and 12 August 2022, Sumo engaged in unlawful door-to-door marketing of energy contracts to at least 5,941 Victorian consumers. 

The Electricity Industry Act 2000 and the Gas Industry Act 2001 prohibit electricity and gas retail licensees (or their agents) from calling on a domestic customer at their home to negotiate an electricity or gas contract – also known as door-to-door marketing. The commission alleges that Sumo entered into commercial arrangements with third parties which required or permitted them to engage in door-to-door marketing of electricity and gas contracts. 

The commission further alleges that Sumo signed up several customers to Sumo energy plans without obtaining their ‘explicit informed consent’, which was required by the applicable energy retail code of practice.  

Proceeding without ‘explicit informed consent’ means Sumo allegedly did not clearly, fully and adequately disclose in plain English all matters relevant to the consent of the affected customers, including by obtaining signatures of customers who did not know they were signing new energy contracts.   

This is the first time the commission has commenced court proceedings seeking civil penalties and other remedies, including adverse publicity orders. The commission has a range of enforcement options available to it under the Essential Services Commission Act 2001. 

The commission will not make further comment, given that the matter is now before the court.