The Federal Trade Commission (FTC) has announced a final rule to prohibit bait-and-switch pricing and other tactics used to hide total prices in live-event ticketing and short-term lodging industries. The rule, which takes effect 120 days after its publication, aims to save consumers billions of dollars and millions of hours by requiring businesses to clearly disclose all mandatory fees upfront.
The FTC estimates that the new rule will save consumers up to 53 million hours per year, equivalent to $11 billion over the next decade. The rule applies specifically to live-event ticketing and short-term lodging industries, where pricing practices have been criticized for being unfair and deceptive.
Under the new rule, businesses must clearly and conspicuously disclose the true total price inclusive of all mandatory fees whenever they offer, display, or advertise any price. This means that the most prominent price in an ad needs to be the all-in total price, with truthful itemization and breakdowns provided but not overshadowing what consumers want to know.
The rule also requires businesses to display the total price more prominently than other pricing information and clearly disclose allowable fees up front before consumers consent to pay. The FTC will use its law enforcement authority to continue enforcing case-by-case tactics, such as drip pricing and misleading fees, in industries beyond live-event ticketing and short-term lodging.
The final rule was approved by a 4-1 vote, with Commissioner Andrew Ferguson dissenting. The FTC plans to educate consumers about the new rule and provide resources for reporting fraud and bad business practices through its website and social media channels.
Source: https://www.ftc.gov/news-events/news/press-releases/2024/12/federal-trade-commission-announces-bipartisan-rule-banning-junk-ticket-hotel-fees