WASHINGTON, D.C. — Consumer Reports (CR) applauded the final rule announced today by the White House to protect consumers from the growing cost of junk fees for live entertainment events, hotels, and vacation rentals. The rule aims to crack down on hidden fees that inflate the cost of goods and services and make it difficult for consumers to comparison shop.
CR has been a strong advocate for removing junk fees that inflate prices at the end of a transaction. Nearly 52,000 people signed CR’s petition urging the FTC to end junk fees as part of CR’s “What the Fee” campaign that started with CR’s 2019 article “Protect Yourself from Hidden Fees.” CR also offers tips on how consumers can avoid junk fees here.
“Americans are sick and tired of getting hit with junk fees that jack up prices and take a big bite out of their wallets,” said Chuck Bell, advocacy program director for Consumer Reports. “The FTC Junk Fee Rule will ensure that companies can no longer hide the true cost of tickets, hotels and short-term rentals, and surprise consumers with excessive junk fees that can’t be avoided. The rule will create greater transparency and accountability regarding pricing, and foster more competition in the marketplace to help consumers find better deals.”
The final rule announced by the Federal Trade Commission (FTC) would prohibit companies in these key three sectors from charging hidden fees and require them to disclose the total cost upfront to customers. Consumers who are shopping for tickets for concerts, sporting events, and other live entertainment will no longer be surprised by a pile of service charges and “convenience fees” tacked on at the end of the transaction, just prior to submitting payment in the shopping cart.
Similarly, consumers who are shopping for hotels and vacation rentals will see the full cost of the scheduled stays, including all resort fees and mandatory charges, when they are first comparing their options for a reservation. Violators can be held liable by the FTC and state attorneys general for redress and civil penalties.
The FTC estimates that the final rule will save consumers 53 million hours of time each year in searching for tickets and short-term lodging. This time savings is equivalent to over $1.1 billion a year, or $11 billion over the next decade.
Media Contact: Emily Akpan, emily.akpan@consumer.org