US: No More ‘Junk Fees’ On Hotels, Live-event Tickets And Vacation Rentals

On Tuesday, the Federal Trade Commission unveiled a final rule banning the practice of collecting ‘junk fees’.

The final rule from FTC now affects multiple industries but mainly targets travel companies, hotels, short-term rental companies, and online travel agencies. The final rule does not prohibit any type or amount of fee, nor does it prohibit any specific pricing strategies.

It only requires the businesses that advertise their pricing and tell consumers the details about prices and fees, instead of adding prices in the name of ‘convenience fees’ or ‘resort fees’.

The two practices that would be prohibited are ‘misrepresenting the total cost by omitting mandatory fees’ and ‘misrepresenting the nature and purpose of a fee’.

“People deserve to know up-front 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,” said FTC Chair Lina M. Khan. The rule won’t go into effect for 120 days after being added to the Federal Register.