President Joe Biden and his administration have spent years tackling what they call “junk fees,” which are mandatory fees that are not transparently disclosed to consumers.
The Federal Trade Commission issued a “junk fees” rule under Biden on Tuesday, expected to go into play in April just as the Trump administration is ramping up its plans for the next four years. This time around the rule was meant to stop companies from hiding total prices and burying other fees when it comes to live-event ticketing, hotel bookings, and other short-term rentals.
While it’s been top of mind for the outgoing administration (considering studies show these fees amount to more than $650 per household per year on average), it’s not clear how President-elect Donald Trump and his team plan to address the regulations. A spokesperson for the incoming administration didn’t respond to a request for comment. Lina Khan, the outgoing FTC chair, used the rule’s final press release to appeal to her successors to keep taking action.
“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 wrote.
In the past, there’s been bipartisan support for banning these types of fees in certain industries. Texas Senator Ted Cruz and Washington Senator Maria Cantwell cosponsored the TICKET Act, which requires event ticket sellers to display the total price up front in any advertisement or marketing that lists a ticket price.
“It is not clear to me whether the push for price transparency regarding the disclosure of mandatory fees will end at the close of the Biden-Harris administration or continue into the next administration,” says Columbia University professor Vicki Morwitz. “In fact, this new FTC regulation will only come into effect in April, when it is already Trump’s term, so it is possible he may even try to take credit for it.”
A potentially conflicting sign is that FTC Commissioner Andrew Ferguson, Trump’s pick to replace Khan as head of the agency, put out a dissenting statement in response to the new rule on junk fees (though he said it had nothing to do with the actual merits of the rule).
“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. . . . [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.”
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