The FTC prohibits hidden “bait-and-switch” fees for hotel and event tickets

the Federal Trade Commission (FTC) It announced Tuesday that it has finalized a new junk-fee rule that seeks to ban the use of bait-and-switch pricing and other methods that hide fees and the total price of tickets to live events as well as hotel and vacation rentals.

“People deserve to know up front what they’re being asked to pay — without worrying that they’ll later be saddled with mysterious fees they didn’t budget and can’t avoid,” FTC Chairwoman Lena Khan said in a statement. . “The FTC rule will put a stop to it Junk fees About live event tickets, hotels and vacation rentals, saving Americans billions of dollars and millions of hours of wasted time.

“I urge enforcers to continue to crack down on these illegal fees and encourage state and federal policymakers to build on this success through legislation that prohibits unfair and deceptive fees throughout the economy.”

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“We all know the experience of facing hidden fees in the final stretch of exit,” President Biden said in a statement. “These unwanted fees creep onto your bill, and companies end up making you pay more because they can. These fees pile up, taking real money out of Americans’ pockets.”

The rule was approved by a vote of 4-1, with the lone dissenting vote coming from Commissioner Andrew Ferguson, a GOP appointee who will take over as FTC chairman when President-elect Trump He takes office in January.

Ferguson opposed the rule and said that “the time for rulemaking by the Biden-Harris FTC is over.” He did not consider whether the FTC should enforce the rule once Trump returns to the White House.

Commissioner Melissa Holyoake, another Republican FTC appointee, voted in favor of the rule and said it “helps protect consumers and competition, while also maintaining flexibility for businesses to engage in lawful activities.” Advertising and pricing practices.”

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The rule does not prohibit any type or amount of fees, nor does it prohibit any particular pricing strategy. Rather, it requires companies to announce their prices Tell consumers The full truth up front about rates and fees.

Businesses are required by the rule to “clearly and conspicuously” disclose the true total price including all mandatory fees when they offer, display or advertise any price for live event tickets or short-term accommodation. The rule prohibits companies from misrepresenting any fees or charges.

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The most prominent price displayed in the ad should include the total price, and while they can display details and details, they cannot obscure the true total.

The rule also requires businesses that exclude permissible fees upfront to clearly and conspicuously disclose the nature, purpose, identity, and amount of those fees before consumers agree to pay.

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For example, companies that exclude shipping or taxes from an advertised price must clearly and conspicuously disclose those charges before the consumer enters payment information.

Reuters contributed to this report.