The Federal Trade Commission (FTC) is set to implement a new bipartisan rule that will impact gaming destinations across America.
The FTC has announced the final iteration of a Junk Fees Rule, which will prohibit the use of bait-and-switch pricing and other hidden fee tactics by hotels, resorts and live entertainment ticketing platforms. The rule requires ticketing platforms, hotels, resorts and other vacation destinations to disclose fees providing consumers with exact total prices.
The final rule, Rule on Unfair or Deceptive Fees, ensures fair business practices while providing transparency to consumers. In 2022, the FTC began requesting public input on unfair and deceptive pricing tactics and whether a rule on the issue would be beneficial. The FTC received more than 12,000 public comments on the issue leading to a proposed rule in October 2023. The proposed rule led to an additional 60,000 public comments.
As a result of this interest, the FTC crafted the final rule that businesses must adhere to.
“People deserve to know up-front what they’re being asked to pay—without worrying that they’ll later be saddled with mysterious fees that they haven’t budgeted for and can’t avoid,” said FTC Chair Lina M. Khan. “The FTC’s rule will put an end to junk fees around live event tickets, hotels and vacation rentals, saving Americans billions of dollars and millions of hours in wasted time.”
The final rule, which requires businesses to display the total price of a good or service more prominently than other pricing info, was approved with a 4-1 vote by FTC commissioners and is set to become effective 120 days after its publication in the Federal Register.
The FTC projects the rule will save consumers up to 53 million hours annually of time spent searching for total pricing for live-event tickets or lodging. Over the next decade, the time savings has a value of more than $11 billion.
Pair of lawmakers make a request to the FTC
Earlier this month, Sen. Mike Lee and Peter Welch sent a letter to Khan and Assistant Attorney General for the Antitrust Division Jonathan Kanter raising concerns over FanDuel’s and DraftKings’ market share dominance across U.S. gambling markets.
The senators are urging the FTC to investigate alleged anticompetitive behavior by the two operators, including preventing emerging operators from securing deals with their existing partners. The existing partners include sports leagues, vendors and payment companies.
