The Federal Trade Commission will soon require hotels, vacation rental platforms, and live event promoters to disclose any fees upfront when they list prices.
The FTC said consumers often see advertised prices for hotel rooms, short-term rentals, and tickets to sporting events and concerts only to be surprised later by so-called “junk fees,” including resort fees, cleaning fees, processing fees and other extra charges.
“People deserve to know upfront what they’re being asked to pay without worrying that they’ll later be saddled with mysterious fees that they haven’t budgeted for and can’t avoid,” FTC Chair Lina Khan said in a statement.
The rule is scheduled to go into effect in 120 days.
Ticketmaster said it supports the new rule.
“Ticketmaster has long advocated for all-in pricing as a nationwide industry standard, and we’re pleased to see the FTC mandate the necessary changes to make ticket-buying more transparent for fans,” the company said.
Four of the FTC’s five commissioners voted to approve the rule. Commissioner Andrew Ferguson, who is President-elect Donald Trump’s choice to replace Khan, was the lone dissenting vote.
The rule requires lodging and ticketing businesses to clearly and conspicuously disclose the true cost – including all mandatory fees – when they display any pricing. Businesses that exclude taxes or shipping fees from advertised prices must also disclose them before customers enter any payment information.
The FTC estimates the rule will save U.S. consumers 53 million hours per year of time spent searching for the true price of lodging or events.
The new rule doesn’t do anything to lower the fees, but a lawsuit filed by the Dept. of Justice might help reduce the fees on concert tickets. DOJ sued Ticketmaster and its parent company, Live Nation Entertainment, earlier this year.
The government asked a court to separate the companies, saying they have a monopoly on concert promotion and ticketing that drives up prices for consumers.
The Biden Administration also has targeted the fee practices of U.S. airlines, banks and online payment platforms.