Hunton Retail Law Resource

The FTC announced its final Rule addressing specific unfair and deceptive pricing practices commonly used by the hotel and event ticketing industries. The Rule requires businesses to clearly disclose the total price a consumer will pay, inclusive of all mandatory fees, whenever they advertise any price for such services. The Rule also requires businesses to display this total price more prominently than other pricing information.

Per outgoing FTC Chair Lina Khan, “the Rule follows a multi-year effort launched by the Commission to examine unnecessary, unavoidable, or surprise charges that inflate costs while adding little to no value” and is one piece of a broader Commission effort to combat junk fees. The Commission received over 60,000 public comments complaining about extra fees in a wide range of industries; the FTC chose to focus more narrowly on hotels and live events, thus garnering the supporting vote of Republican Commissioner Melissa Holyoak. Incoming FTC Chair Andrew Ferguson voted no, issued a dissenting statement.

The Rule, which goes into effect 120 days after its publication in the Federal Register applies to all businesses – including corporations, partnerships, associations, or any other entity or individual – offering, displaying, or advertising live-event tickets and hotel lodging. It’s important to note that business-to-business transactions are covered by the Rule. While requiring disclosure of all mandatory fees up front, certain fees (e.g., taxes, shipping, and fees for optional services) may be disclosed later, as long as consumers are alerted prior to payment that such fees exist and will be added.  

To help businesses comply, the FTC issued an infographic outlining the specific requirements of the Rule: