FTC bans hidden junk fees on tickets and short-term lodging purchases

I am unable to bear in mind a current occasion during which the ultimate quantity I owed, whether or not it’s for a resort reservation or a live performance ticket, did not make my eyes bug out in shock. Now, a new rule from the Federal Trade Commission (FTC) ought to restrict these bait-and-switch pricing techniques. The FTC has introduced the Junk Charges Rule, requiring live-event ticketing and short-term lodging companies to be transparent in regards to the complete value owed. Different firms will proceed to be monitored on a case-by-case foundation for misleading pricing.

The brand new rule, first proposed in 2023, ought to eliminate all these additional “resort” and “service” charges tacked on at checkout that usually really feel arbitrary. Corporations can nonetheless technically embody them, however they have to be factored into the preliminary value proven. The required disclosure means the primary quantity you see on shows, commercials and the like also needs to be the full quantity you pay.

The Junk Charges Rule additionally requires companies to show that last quantity “extra prominently” than some other data. So, it might probably’t say it should value one factor in large font after which in actually small print add that there is a variety of charges on prime of it. “Individuals need to know up-front what they’re being requested to pay — with out worrying that they’ll later be saddled with mysterious charges that they haven’t budgeted for and may’t keep away from,” stated FTC Chair Lina M. Khan. “I urge enforcers to proceed cracking down on these illegal charges and encourage state and federal policymakers to construct on this success with laws that bans unfair and misleading junk charges throughout the economic system.”

The FTC claims the Junk Price Rule will save people as much as an estimated 53 million hours every year and greater than $11 billion over the following decade. The rule will go into impact 120 days after it is revealed within the Federal Registrar.