FTC Rule Targets Hidden Fees to Protect Travelers

Washington, D.C. — The Federal Trade Commission (FTC) introduced a new rule on December 2023 aimed at protecting travelers from hidden fees in the short-term lodging and live-event ticketing industries. The regulation, starting Monday, requires businesses to disclose all fees upfront, creating greater price transparency for consumers.

The rule addresses so-called “junk fees,” which may be added to booking prices for amenities that customers often do not want or expect, such as resort or destination fees. Cathy Mansfield, a professor at Case Western Reserve Law School, highlighted that these fees mislead consumers, making it appear as though businesses are not raising prices.

Under the new regulation, short-term lodging companies, including hotels and vacation rentals, must clearly state all costs in advertisements, ensuring that the total price includes any obligatory fees. “Transparency in pricing helps travelers make informed decisions,” Mansfield explained.

A representative from Marriott informed Fox News Digital that the company began providing clear pricing in May 2023, leading the hospitality sector in transparency efforts. “We were the first hospitality company to ensure that non-government fees are included in the total price displayed to customers,” the spokesperson said.

The American Hotel and Lodging Association (AHLA) echoed the importance of the initiative, stating that consistent pricing is crucial for clarity in the marketplace. Rosanna Maietta, the AHLA’s president and CEO, remarked that establishing a federal standard will benefit travelers.

Nerdwallet suggests travelers can avoid resort fees by booking rooms on points or achieving elite hotel status. The organization noted that many hotels still impose these costs, which are often additional cash fees on top of booked rates.

The rule also targets the live event ticketing industry. Prices must reflect all known charges, including mandatory fees for services that often come with a ticket purchase. The FTC’s charge is to enforce transparency in all facets of consumer transactions.

Despite challenges from the previous administration regarding consumer protection agencies, FTC officials, including Chris Mufarrige from the Bureau of Consumer Protection, maintain that they are committed to protecting consumers through enforcement of these new rules.

As the implementation date approaches, travelers have begun to notice increased compliance among businesses, observing clearer pricing strategies in advertisements. Experts recommend consumers report any businesses that fail to follow the new regulations, as penalties could exceed $50,000.