FTC Announces Junk Fees Rule, Banning Deceptive Pricing in Live Event Ticketing Industry

“_MG_7348” by dbking is licensed under CC BY 2.0.

On Tuesday, Dec. 18, the Federal Trade Commission announced the Junk Fees Rule, which will address widespread complaints about the live entertainment industry by banning deceptive fees added to initial prices at the point of purchase. The rule, which also targets the short-term lodging industry, arrives amid a period of increased scrutiny on the business practices of giants in live event ticketing as a small but meaningful win for American concertgoers.

The Junk Fees Rule does not ban high fees outright, nor the pricing strategy of subdividing the total into incremental additions, but rather requires that ticketing and rental agents display the full price up-front. The true total price, inclusive of any additional fees, must be displayed more prominently than any other pricing information –addressing a concern voiced by industry insiders that holdouts would gain a competitive advantage to companies that adopted all-in pricing prior to the mandate. The Junk Fees Rule will go into effect 120 days after its publication in the Federal Register, plotting the cut-off in mid-April of next year.

“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 in the organization’s official release. “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 FTC’s Junk Fees Rule is the culmination of two years of examination by the regulators, finalized one year after its initial proposal. Since the organization first stated its intention to intervene, ticketing companies including Live Nation, SeatGeek and TickPick moved to all-in pricing in a pledge with President Biden. “We’ve led the industry by adopting all-in pricing at all Live Nation venues and festivals and applaud the FTC’s industry-wide mandate so fans will now be able to see the total price of a ticket right upfront no matter where they go to see a show or buy a ticket,” Live Nation offered in a statement.

“I urge enforcers to continue cracking down on these unlawful fees and encourage state and federal policymakers to build on this success with legislation that bans unfair and deceptive junk fees across the economy,” Khan charged in closing. Read the FTC’s full release here.