FTC Bans Hidden Fees for Live Events and Short-Term Rentals: What You Need to Know
Wondering when the FTC’s ban on hidden fees takes effect or how it impacts ticket sellers and short-term rentals? Starting May 12, 2025, the Federal Trade Commission (FTC) will officially enforce its groundbreaking Rule on Unfair or Deceptive Fees, ensuring full pricing transparency for live events, hotels, motels, Airbnb, VRBO, and similar short-term lodging providers. This new regulation is a direct response to consumer frustrations with "junk fees," bait-and-switch pricing, and hidden charges that have plagued the travel, hospitality, and entertainment sectors for years.
What Is the FTC’s "Rule on Unfair or Deceptive Fees"?
The FTC’s new rule aims to crack down on any deceptive pricing practices, requiring businesses to disclose the total cost—including all mandatory fees—upfront. Whether you’re buying concert tickets, booking a short-term rental, or staying at a hotel, you’ll now see a clear, honest total price from the very beginning. This regulation also demands that total pricing be more prominently displayed than any teaser rates or partial pricing, creating a fairer marketplace for consumers and leveling the playing field among businesses.
Who Must Follow the New FTC Pricing Rules?
The rule applies broadly across several industries. Live event ticket sellers, hospitality providers, third-party resellers, travel agencies, and online marketplaces like Airbnb and VRBO must all comply. Importantly, even third-party platforms facilitating sales are responsible for ensuring transparent pricing practices. Airbnb, for instance, has already updated its platform to present users with the total cost of a stay upfront, reflecting its commitment to consumer trust and regulatory compliance.
Key Requirements for Live Events and Rentals
To align with the new FTC rule, businesses must:
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Display the full total price—including all known mandatory fees—upfront in all advertisements, offers, and listings.
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Ensure that the total price is more prominently displayed than any breakdown or smaller pricing details.
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Clearly identify and explain all fees without using vague labels like “convenience fee,” “service charge,” or “processing fee.”
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Avoid any bait-and-switch tactics or misrepresentation about prices and refund policies.
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Continue dynamic pricing practices legally, provided they are honest and transparent about final costs.
What Fees Can Be Excluded?
While the new rule requires full disclosure, there are specific exceptions. Businesses can exclude certain charges such as:
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Government-imposed taxes and fees
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Shipping charges
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Optional goods or services selected by consumers during checkout
However, these exclusions must be clearly communicated before the final purchase step. For example, if shipping costs are not included in the advertised price, businesses must prominently state the amount and explain the purpose before asking for payment.
Handling fees, notably, are not exempt and must be incorporated into the upfront total price.
Why This New Rule Matters
The FTC first passed this landmark rule in December 2024, marking a major consumer rights victory against deceptive corporate practices. Hidden fees have long frustrated travelers, concert-goers, and shoppers, eroding customer loyalty and consumer confidence. With this regulation, the FTC moves to restore transparency, trust, and fairness in e-commerce, event ticketing, and hospitality services.
Moreover, businesses that fail to comply could face heavy fines, legal penalties, and a significant loss of consumer goodwill. Embracing transparency not only aligns with the law but can also enhance a company's brand reputation, customer retention, and online reviews, ultimately boosting conversion rates and profit margins.
How Consumers and Businesses Can Prepare
Consumers should be on the lookout for clear total pricing in all advertisements and listings starting May 12. If a business fails to disclose complete fees upfront, consumers have the right to file complaints with the FTC.
Meanwhile, businesses should audit their pricing displays, checkout pages, and marketing materials immediately to avoid non-compliance. Investing in transparent billing systems and straightforward pricing communication will be key to navigating the new regulatory environment successfully.
The FTC’s new ban on hidden fees represents a bold shift toward consumer-first commerce. By demanding honest pricing across live events, short-term rentals, and hospitality, the agency is setting new standards for business ethics, customer experience, and market fairness. Whether you're planning your next concert night or booking a cozy vacation rental, expect more honest pricing—and fewer unpleasant surprises—starting May 12.
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