The Webjet Group Ltd (ASX: WJL) share price has taken a hit this morning, plunging a turbulent 8% at the market open.

Shares in the travel company have since regained some ground and are now swapping hands 4% lower at 81 cents apiece.

This follows a company announcement acknowledging that the Australian Competition and Consumer Commission (ACCC) has commenced Federal Court proceedings against Webjet, accusing it of deceptive practices regarding airfare pricing and flight bookings.

While today's news is not price-sensitive, it's still been enough to spook some investors holding the travel stock. Let's see.

What are the allegations against Webjet?

According to court filings, the ACCC alleges that Webjet misled customers by advertising airfares at prices that excluded mandatory fees.

The regulator said Webjet's marketing materials displayed phrases like "flights from $x" without clearly disclosing the inclusion of a 'Webjet servicing fee' and a 'booking price guarantee' fee. These fees ranged between $34.90 and $54.90.

Webjet's app and website offers travel-related products and services to consumers, including from different airlines. Consumers can compare and book flights, hotels, car rental and travel insurance through the Webjet website and app.

The ACCC alleges Webjet breached the Australian Consumer Law when it made statements on its app, in marketing emails, on social media and on its website about the minimum price of airfares which omitted compulsory fees charged by Webjet.

The statements included "flights from $x" when the price quoted excluded Webjet's compulsory 'Webjet servicing fee' and 'booking price guarantee' fee which ranged from $34.90 to $54.90 per booking, depending on whether the flights were domestic, NZ/Pacific flights or other international flights.

According to the filings, these practices were "false, misleading, deceptive or likely to mislead ordeceive". All the bookings reportedly had Webjet fees attached to the promoted price.

"it was therefore not possible for any consumer to purchase a promoted flight from Webjet for the Promoted Price", it says, despite some prices having an "asterisk".

The watchdog also accused Webjet of confirming 382 flight bookings that were not actually secured with airlines.

In these cases, customers were later asked to pay additional amounts to finalise bookings. Or, they were offered refunds, often after making other travel arrangements.

ACCC chair Gina Cass-Gottlieb said the ACCC was "very concerned" over the matter.

We are very concerned about this alleged conduct by Webjet, which represented to consumers that their flight booking had been confirmed and left some consumers in the position of having to pay more to later complete the booking.

The ACCC is currently prioritising consumer and competition issues in the aviation sector as well as conduct in the digital economy. We remind all businesses, whether they are online retailers or bricks and mortar stores, that they need to comply with the Australian Consumer Law by not misleading consumers and displaying prices clearly, including hidden fees and surcharges

What does this mean for Webjet?

These developments come at a critical time for the Webjet share price, which has recently been striving to build investor confidence since its September ASX listing following its separation from Web Travel Group Ltd (ASX: WEB).

Time will tell if the ACCC's allegations will impact the underlying business or the stock price in the long term.

Some within the broker crowd are bullish on the Webjet share price.

Jefferies recently upgraded the stock to a buy with a $1.10 price target, citing improving margins in the company's GoSee business.

It also sees upside potential in management's "conservative" FY25 guidance.

Goldman Sachs rates it a buy with a $1.10 price target as well.

Webjet share price takeaway

The Webjet share price is under pressure today amid the ACCC's allegations regarding its price promotions over the past year.

This extends the ACCC's efforts this year to crack down on corporations it considers to be misleading customers.

Whether or not Webjet was acting deceptively or not is a matter for the court to decide.

The market will decide whether or not this will impact the Webjet share price. The stock is trading 5% higher since listing.