Ftc’s Rule On Unfair Or Deceptive Fees Goes Live

Convenience fees on concert ticket orders may go the way of McDonald’s PlayPlaces, and get replaced with something less likely to get their purveyors in legal trouble.

Starting today, the Federal Trade Commission’s rule on misrepresenting fees and bait-and-switch pricing takes effect for businesses selling live-event tickets and short-term lodging.

Will fees just fade away?

According to the FTC’s FAQ about the new policies, some add-on fees won’t be illegal, but surcharges can’t be surprising anymore:

• Companies have to prominently display the total cost, including “all charges or fees the business knows about and can calculate upfront,” before asking for payment.
• They must “avoid vague phrases like ‘convenience fees,’ ‘service fees,’ or ‘processing fees,’” per the FTC, and be clear about what a charge is for.
• Tax and government charges, shipping costs, and fees for “optional goods or services” that can be purchased simultaneously can all be disclosed “later in the transaction.”

On deck: U-Haul. The moving fleet that only uses Arizona license plates often advertises rentals for under $20 on the sides of its trucks. The problem? The legal director of the advocacy group Truth in Advertising told Business Insider, “There’s not a consumer on the entire planet who will pay this $19.95 for a U-Haul truck,” after mandatory extra fees, “so the price is false.” U-Haul did not respond to BI’s request for comment.—HVL