by Lacey Pfalz
Last updated: 12:10 PM ET, Wed October 11, 2023
The Federal Trade Commission (FTC) announced a new proposed rule that would make it illegal for businesses to charge so-called junk fees, which are often hidden from consumers, which, if passed, could save travelers money on everything from tickets for events to accommodations.?
The new rule, if passed, would mandate that companies be fined and forced to pay back consumers if they continued charging junk fees, according to ABC News.?
An official announcement by the FTC states that the new rule could save consumers tens of billions of dollars in junk fees across the economy, including the travel industry. It also estimates that, should the rule be enacted, it would save consumers over 50 million hours each year in wasted time spent searching for the total price in live ticketing and short-term lodging.?
All too often, Americans are plagued with unexpected and unnecessary fees they cant escape. These junk fees now cost Americans tens of billions of dollars per yearmoney that corporations are extracting from working families just because they can, said FTC Chair Lina M. Khan in the announcement. By hiding the total price, these junk fees make it harder for consumers to shop for the best product or service and punish businesses who are honest upfront. The FTCs proposed rule to ban junk fees will save people money and time, and make our markets more fair and competitive.
The new proposed rule comes during a year when travel giants like Frontier Airlines, Marriott, Hilton and Hyatt have faced lawsuits or government investigations into their charging travelers hidden fees.?
If the rule is enacted, it would be illegal to advertise a price that hides a mandatory fee, and it would also be illegal not to disclose the purposes of any extra fees that consumers would pay.?
The FTC can enact the proposal without approval from Congress but has not specified when this would take place.?
The proposed rule is another portion of the Biden-Harris Administration's efforts to ease economic burdens for Americans. Within the travel industry, the administration has pushed airlines to commit to refunding passengers who have been impacted by cancellations or delays that are the responsibility of the airlines, among other things.?
Junk fees mean that working families have to pay higher prices for the things they need, which is why President Biden is taking decisive action to eliminate them, said U.S. Transportation Secretary Pete Buttigieg. At DOT, we have secured commitments from major U.S. airlines to provide free rebooking, meals and hotels when they are responsible for stranding passengers. Were working to stop airlines from forcing parents to pay to sit next to their kids, and requiring them to disclose hidden fees for things like extra bags. And weve helped secure billions of dollars in refunds for passengers whose flights are canceled.
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