New Federal Junk Fee Rules Are in Effect: What to Look…

All right, savvy shoppers. It’s been a month since the new federal rules about fee disclosures have kicked in. Are you seeing a difference in your online shopping?

It’s not often that the federal government of the United States does something to protect and inform consumers in these times. But last year a new set of rules about deceptive fees was adopted by the Federal Trade Commission, and the deadline for the rules to take effect passed on May 12, 2025.

Businesses have had a month to get themselves in shape—have you noticed a change?

What the FTC’s bait-and-switch pricing rules require

The name given to the new trade regulations was, plainly enough, the Rule on Unfair or Deceptive Fees. Businesses that sell short-term lodging (i.e., hotels, vacation rentals, and any accommodation a vacationer would book) and tickets for live events (as opposed to prerecorded ones) are supposed to adhere to the following:

1. Websites must disclose the total price from the start. The FTC says that the customer must see “all charges or fees the business knows about and can calculate” at the very start of the transaction. Disclosure must be up-front, according to the FTC. So if a home renter has a mandated cleaning fee and doesn’t include it in the first price you are quoted, the renter is in violation of the rule.
2. The only fees that can be excluded from the up-front price are taxes or other government charges, shipping charges, or charges for optional fees that the customer added after seeing the up-front price. All other fees you would expect to pay must be disclosed. “For example, if a hotel requires guests to pay for towels, the hotel must include the towel fee in the total price,” the FTC advises. Hotels also can’t forget to disclose resort fees because “a business cannot treat as optional an automatic fee that it removes only if a person notices and challenges it.”
3. A business must display the total price more prominently than other pricing information.
4. Businesses have to disclose excluded charges before asking for payment. The FTC explains: “For example, if a business excludes taxes or shipping charges from the advertised price, the business must clearly and conspicuously disclose the amount and purpose of those charges.”
5. No misrepresentations about fees and charges allowed. In other words, the FTC says, “a business must describe what fees are for and avoid vague phrases like ‘convenience fees,’ ‘service fees,’ or ‘processing fees.'” If a hotel charges an “environmental fee,” the business could get in trouble if it “doesn’t actually use the fee to promote environmental sustainability or conservation,” the FTC says.

It’s too bad restaurants aren’t covered by this new set of regulations. We’re sick of seeing weird, unexplained surcharges added to the bill in tourist destinations.

Junk fees aren’t banned—but they’re highlighted

Contrary to the incorrect headlines that heralded these changes when they were first previewed last December, junk fees aren’t banned. Sadly, vendors can keep charging junk fees, as long as they’re disclosed from the top and the vendor does a better job of justifying the fees.

As consumer protection, that’s fairly weak, but we’ll take what we can get. We do appreciate that the FTC has already been firing warning letters at businesses suspected of violating the new rules.

We wish the U.S. government had the courage to eliminate resort fees completely, as Europe has accomplished by forcing the fees to be included in advertised prices. But our current Congress almost always favors big business over individuals, so the United States is pretty much the only country that throws those fees onto bills in a false gambit to make hotel stays seem cheaper than they are.

A few more wrinkles to look out for:

If a business levies surcharges for the use of a credit card, you must be informed whether a credit card is the only viable mode of payment. If you could pay in other ways, the fees are considered optional and don’t have to be disclosed up front.

If you have to dig several pages in to find the total cost and it rises even though you didn’t add anything to your order, that may be a violation. If the full pricing information or explanation can only be accessed via a pop-up window, that may be a violation, too.

And if a travel search provider, such as a hotel booking engine, shows you a price that turns out not to be accurate, that doesn’t mean either the hotel or the aggregator site is necessarily off the hook—companies are now required to send accurate and complete prices to search engines as well.

Vendors have to show you the full price up front even if they use dynamic pricing and the rates change from moment to moment.

How to report businesses for bait-and-switch pricing

To look over the FTC’s synopsis of the new rules, which explains them in plain English, click here. You can also read the government’s notes about the new regulations in their longer form, delivered in indefatigable governmental legalese, by clicking here.

If you suspect a business of breaking the rules, there’s a web page where you can file a report: ReportFraud.FTC.gov.

If the FTC finds a business breaking the rules, the government agency can force the violator to refund your money, get the company’s website in order, or even pay fines of up to £50,000 per violation (to the government, not to you, unfortunately).