FTC bans junk ticket, hotel fees

(The Hill) - The Federal Trade Commission (FTC) banned surprise junk fees for ticketing platforms, vacation rental sites and hotel fees on Tuesday, deeming the practice “unfair” and “deceptive.”

“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,” FTC Chair Lina M. Khan said in a statement, urging enforcers to crack down on the issue.

The commission passed the final rule with a 4-1 vote. Republican commissioner Andrew Ferguson issued a dissenting statement citing disdain for the Biden-Harris administration. Last week, he was tapped by President-elect Trump to replace Khan as chair of the commission in his incoming administration.

“This lame-duck Commission should give its regulatory pen a much-needed rest, focus on routine law-enforcement, and prepare for an orderly transition,” Ferguson wrote. 

“It is particularly inappropriate for the Biden-Harris FTC to adopt a major new rule that it will never enforce, as the Final Rule will not take effect until many months after President Trump takes his oath of office,” he added.

The final rule will become effective 120 days after its publication in the Federal Register, coinciding with the first few months of Trump’s administration.

“His [Trump’s] incoming Administration should have the opportunity to decide whether to adopt rules that it, not the Biden-Harris FTC, will be called upon to enforce,” Ferguson stated.

“The precedent set today is unfortunate, but it is certainly a precedent by which future Commission majorities will abide.”

However, President Biden disagreed, commending the FTC for acting on his requests. 

“We all know the experience of encountering a hidden fee at the very last stage of check out —these junk fees sneak onto your bill and companies end up making you pay more because they can. Those fees add up, taking real money out of the pockets of Americans,” Biden said in a statement.

“Today’s announcement builds on work across my Administration to ban junk fees and lower costs—saving many families hundreds of dollars each year.”

The commission made their decision based on more than 60,000 comments from consumers following a similar proposed rule in 2023. Still, the Biden administration's desire to go after companies with junk fees has faced pushback in court. 

A Trump appointed judge in Texas challenged his credit card late fee cap in May while a New Orleans three-judge panel said his strike to airline fees “likely exceeds” the agency’s authority “and will irreparably harm airlines.”

Once in office, Trump could move to withdraw the Tuesday junk fees rule for further consideration while a Republican controlled Congress could sever the measure entirely.