Monday, June 2, 2025
In a landmark update to consumer protection policies, the Federal Trade Commission (FTC) has introduced a new nationwide rule that directly targets the issue of hidden charges in the travel and event industries. Designed to eliminate misleading pricing tactics, the regulation now requires that all short-term lodging operators—whether traditional hotels, vacation rentals, or platforms like Airbnb—display the complete price of a stay before a booking is confirmed.
This new regulation is part of a broader initiative by the FTC to eliminate what are referred to as “junk fees” or “drip pricing,” a practice where the initial advertised price omits essential fees that are only revealed later in the transaction process. In the hospitality world, these extra charges typically take the form of “resort fees” or “destination charges” and are often added on just before checkout, leaving customers blindsided by higher-than-expected totals.
Ending Hidden Charges in Lodging and Events
The FTC’s final rule takes aim at this practice by making it mandatory for businesses to disclose the total price—including all non-tax fees—at the first point of contact. That means when a traveler sees a room listed online or in a promotional email, the amount they see must reflect the full cost they are obligated to pay, excluding only local taxes or fees mandated by government entities.
The intent is to ensure consumers are no longer misled by seemingly low prices that balloon at checkout. Whether the additional fees go toward amenities like a fitness center or Wi-Fi access, they must now be clearly displayed upfront as part of the overall advertised cost.
Industry-Wide Impact Across Lodging Platforms
This regulation applies not only to major hotel chains but also to all short-term accommodation providers, including boutique hotels, motels, vacation homes, and rental platforms. In short, no matter how or where travelers book their stay, they can now expect uniform standards in pricing transparency.
By creating a consistent federal rule, the FTC aims to replace a previously fragmented system of voluntary compliance and uneven enforcement. This new requirement is intended to establish a nationwide baseline, ensuring all travelers have access to clear and honest pricing regardless of which website or service they use.
Consumer Benefits: Transparency and Trust
The direct benefit for consumers is significant. Booking accommodations will now come with fewer surprises, and travelers can better budget and compare options. The rule addresses one of the most frequent complaints from hotel guests: hidden fees that weren’t disclosed until the final screen of the booking process or, worse, upon arrival at the hotel.
With the new regulation in place, the total price must account for any mandatory charges—like facility fees or service charges—that customers cannot opt out of. This allows for more accurate cost comparisons and gives travelers the ability to make informed decisions.
Hotel Industry Moves Toward Voluntary Compliance
Several major hospitality companies had already begun adapting to pricing transparency in anticipation of tighter regulations. Some began listing resort and service fees as part of their advertised rates, reflecting growing consumer demand for honest, upfront pricing.
The FTC’s rule reinforces and standardizes this shift, applying it to the entire industry. It also complements efforts by hotel associations and consumer advocacy groups that have pushed for clearer booking disclosures across digital and traditional platforms alike.
By enforcing a federal standard, the rule brings all industry players—big or small—into alignment and prevents businesses from gaining a competitive edge by displaying artificially low prices.
Standard Applies to Events Too
While lodging has been the main focus, the regulation also includes the live-event ticketing sector. Just like hotels, event organizers and ticketing platforms will now have to show the full price—including service fees and mandatory charges—upfront when advertising tickets for concerts, sporting events, and theater performances.
This parallel requirement addresses similar consumer frustrations in the entertainment industry, where ticket prices can rise dramatically after service charges are applied during the checkout process. The aim is to ensure a uniform experience across both the travel and entertainment sectors, giving people full transparency before they commit to a purchase.
Enforcement and Accountability
The FTC has made it clear that this rule is not symbolic—it will be enforced. Lodging and event businesses that fail to comply may face penalties, including fines and other legal actions. The Commission has the authority to act against deceptive and unfair trade practices, and this rule falls squarely within that scope.
To support implementation, the FTC will issue compliance guidance and work in coordination with federal and state agencies to monitor industry behavior. Businesses will be expected to update their systems, marketing strategies, and customer communication practices to align with the new standards.
Public awareness efforts will also accompany the rollout of the rule, ensuring both consumers and businesses understand the expectations and rights involved.
Why This Rule Is Necessary
According to economic evaluations by the FTC, deceptive pricing practices distort competition and cost consumers billions annually. When businesses hide part of the total cost until the last stage of a transaction, they gain an unfair advantage over those that provide honest pricing from the outset.
This manipulative model not only misleads individual buyers but also undercuts fair competition. Businesses that play by the rules often lose out to those who use price deception to attract customers with seemingly lower rates.
In travel and event planning—where prices vary widely and consumers rely heavily on cost comparison—clarity in pricing is especially critical. The new rule is intended to reset market expectations and protect consumer rights at every stage of the booking process.
A Turning Point for Booking Practices
This initiative represents a broader cultural shift toward consumer-centric business models. People are increasingly demanding fairness, accuracy, and transparency in their transactions, particularly in digital environments where misleading tactics are harder to detect in real-time.
The FTC’s rule helps institutionalize these values by embedding them into the legal framework of industries that touch millions of Americans every year. Whether booking a family vacation, attending a concert, or planning a weekend getaway, consumers will now have greater confidence that the price they see is the price they’ll pay.
Looking Ahead
As the rule is implemented, businesses across the lodging and live-event spaces will need to assess their advertising, online booking systems, and internal pricing policies. Early compliance will not only avoid penalties but also build consumer goodwill at a time when trust and transparency are more valuable than ever.
This regulatory shift also sets the stage for similar reforms in other sectors where hidden fees are commonplace, potentially inspiring further consumer protections in everything from airline ticketing to car rentals and beyond.
Conclusion: Transparent Pricing Becomes the New Standard
The FTC’s new rule marks a critical advancement in consumer rights, ensuring transparency and fairness in how prices are presented to the public. By banning hidden fees in lodging and event ticketing, the Commission is protecting individuals from deceptive practices that have long plagued these industries.
With this rule now in place, the travel and entertainment experience becomes clearer, fairer, and more respectful of the consumer’s right to know exactly what they’re paying for—right from the start. The message is clear: transparency is no longer optional; it’s the new standard.
