FTC Mandates Full Disclosure of Resort Fees Under New Rule

The Federal Trade Commission (FTC) has implemented a new regulation requiring businesses across sectors, including live events and lodging, to disclose the full cost of services upfront. Announced on 17 December, the Junk Fees Rule aims to eliminate misleading pricing practices by mandating transparency around mandatory fees.

For casino resorts, this means that resort fees, which typically cover amenities such as Wi-Fi, gym access, and pools, must be included in the total advertised price of lodging. Any additional charges not included must be clearly itemised, with their purpose and cost disclosed before consumers make a payment.

FTC Chair Lina Khan stated, “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.” According to FTC estimates, consumers will save approximately 53 million hours annually previously spent searching for complete pricing information.

The rule forms part of President Joe Biden’s broader campaign to combat “junk fees,” a strategy initiated in 2022 targeting airlines, credit cards, and lodging industries. Following public feedback, including over 70,000 comments, the rule is set to take effect within 120 days, potentially as early as April 2024.

President Biden celebrated the rule’s introduction, saying, “Junk fees sneak onto your bill and companies end up making you pay more because they can. Today’s announcement builds on work across my administration to ban junk fees and lower costs—saving many families hundreds of dollars each year.”

However, industry representatives, including the Nevada Resort Association and the American Gaming Association, have expressed concerns. Critics argue that the rule may not significantly benefit consumers, as resort fees themselves remain unchanged. Properties like MGM Resorts have recently increased these fees, with nightly charges in Las Vegas now ranging between $45 and $55. Industry groups maintain that these fees reflect the value of included amenities and are already disclosed transparently.

The effectiveness of the new rule in improving pricing transparency and enhancing consumer trust will be observed after its enforcement in 2024.