The FTC prohibits hidden ‘bait-and-switch’ payments for hotel and event tickets
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I Federal Trade Commission (FTC) announced on Tuesday that it has finalized a new junk fees law that seeks to prevent the use of lure and switch pricing and other tactics that hide fees and the total price of live event tickets and hotel and resort facilities.
“People deserve to know ahead of time what they’re being asked to pay — without worrying that later they’ll be hit with mysterious fees they haven’t budgeted for and can’t avoid,” FTC Chairwoman Lina Khan said in a statement. . “The FTC rule will expire unwanted funds around live event tickets, hotels and vacation rentals, saving Americans billions of dollars and millions of hours of wasted time.
“I urge law enforcement to continue to crack down on these illegal fees and encourage state and federal policymakers to build on this success with legislation that prohibits unfair and deceptive waste charges throughout the economy.”
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Lina Khan speaks on stage during the Fast Company Innovation Festival 2024 at BMCC Tribeca PAC Sept. 19, 2024, New York City. (Eugene Gologursky/Getty Images for Fast Company / Getty Images)
“We all know the experience of finding money hidden in the last phase of the exit,” President Biden said in a statement. “These junk funds sneak into your credit, and the companies end up making you pay more because they can. Those funds add up, taking real money out of the pockets of Americans.”
President Biden speaks during the National Association of Counties legislative conference in Washington, DC, Feb. 12, 2024. (Chris Kleponis/CNP/Bloomberg via Getty Images/Getty Images)
The legislation was approved by a 4-1 vote, with one dissenting vote from Commissioner Andrew Ferguson, the Republican nominee to take over as FTC chairman there. Trump is the President-elect starts working in January.
Ferguson opposed the legislation and said “the time of the Biden-Harris FTC is over.” He did not consider whether the FTC should enforce the law once Trump returns to the White House.
Commissioner Melissa Holyoak, another Republican FTC appointee, voted for the rule and said it “helps protect consumers and competition, while also preserving business flexibility for businesses to participate in the law.” advertising and pricing habits.”
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The law does not prohibit any type or amount of payment, nor does it prohibit any particular pricing strategy. Instead, it requires businesses to advertise their prices tell buyers the whole truth up front about prices and costs.
The Federal Trade Commission building in Washington, DC (Jeffrey Greenberg/Universal Images Group via Getty Images/Getty Images)
Businesses are required by law to “clearly and clearly” disclose the actual price including all mandatory fees whenever they offer, display or advertise any price for tickets to a live event or temporary accommodation. The law prohibits businesses from misrepresenting any money or charge.
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The most prominent price shown in the ad must include the price, and although it may indicate the manufacture and distribution, it cannot cover the actual amount.
The law also requires businesses that do not include pre-authorized payments to clearly and transparently disclose the nature, purpose, ownership and amount of those funds before consumers agree to pay.
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For example, businesses that do not include shipping or taxes in the advertised price must clearly and transparently disclose those costs before a buyer enters payment information.
Reuters contributed to this report.
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