The FTC’s Rule on Unfair and Deceptive Fees takes effect today, May 12, 2025, and it’s about to shake up how businesses disclose prices for live-event tickets and short-term lodging. The Rule targets “drip pricing” — those frustrating add-on fees that show up at the end of a purchase — by requiring businesses to be upfront about the total price.

While our previous blog post provides an overview of the Rule’s key requirements and high stakes (penalties for non-compliance with the FTC’s Rule can exceed $53,000 per violation), FTC staff recently published Frequently Asked Questions (FAQs) that, while not binding on the Commission, are designed to provide consumers and businesses with insight into “the staff’s view of the Rule’s requirements.”  Here are some highlights:

The Rule applies to any business that offers, displays, or advertises live-event tickets or short-term lodging. That includes not just primary sellers, but also third-party platforms, resellers, and travel agents. Business-to-business transactions are covered, too. That said, pre-recorded film screenings and performances don’t count as “live events” under the Rule. And while the Rule doesn’t define what qualifies as “short-term” lodging, traditional long-term rentals and housing arrangements that involve a landlord-tenant relationship are out of scope.

At the heart of the Rule is the requirement to disclose the total price up front — meaning the price must include all mandatory fees and charges the business knows about and can calculate when the offer is made. Taxes, government charges, shipping fees, and charges for optional services don’t need to be included in the initial total price, but they must be disclosed before the customer is asked to pay. These disclosures must clearly explain the nature, purpose, and amount of the excluded charges — no hiding behind generic labels like “convenience fee” or “service charge.”

The FAQs also clarify what counts as “clear and conspicuous.” Disclosures need to be understandable and hard to miss. While the Rule doesn’t mandate specific font sizes, it does require that disclosures are prominent, especially when presented digitally or in print. The total price must be more prominent than any other pricing — aside from the final payment amount, which must be at least equally prominent. In other words, if you’re showing consumers any previously excluded fees at checkout, the final price must stand out just as much as, or more than, the initial total.

Mandatory fees aren’t limited to ticket prices or room rates — they include any fees the customer must pay or can’t reasonably avoid. This includes charges for goods or services necessary to make the main product usable in the way consumers would expect. For example, if a ticketing site requires a non-optional fee to complete a purchase, that fee must be baked into the total price shown upfront.

The Rule draws a line between mandatory and optional ancillary charges. If a credit card fee applies and no other fee-free payment option is available, that fee is considered mandatory and must be included in the total price. Likewise, a hotel that tacks on an automatic resort fee — even one it sometimes waives if challenged — must include it in the advertised price. But optional extras like VIP upgrades or travel protection plans don’t have to be included in the upfront total, so long as they’re disclosed before the consumer checks out.

The Rule also weighs in on credit card fees. If paying by credit card is the only realistic way to complete a transaction, the fee is mandatory and must be reflected in the total price. If there’s a truly viable alternative, the fee is optional — but even then, it must be disclosed, and the final price must reflect it before the customer pays.

Shipping charges are addressed too. While they don’t need to be exact to the penny, they must reasonably reflect actual shipping costs. The FTC makes clear, however, that handling fees are a different story — those are considered mandatory and belong in the total price.

As for dynamic pricing, the FTC gives businesses room to adjust prices based on things like region, demand, or inventory — but only if the pricing isn’t misleading. If you advertise prices nationally or across a region where prices vary, the advertised price should reflect the highest possible total price relevant to the area being targeted.

Discounted pricing gets similar treatment. Promotions and discounts are allowed, but if they’re not universally available, they can’t be factored into the total price shown up front. A promotion like “Buy One Get One Free” can only affect the displayed total price once the consumer qualifies for the deal. Until then, the regular total price must be the one featured most prominently.

Online marketplaces and other intermediaries are also on the hook. If they’re responsible for displaying prices, they must give sellers the information they need to calculate accurate total prices. So if a platform charges a fee that’s passed on to the consumer, it must provide that information to sellers to ensure the fee is properly included in the total price.

The Rule doesn’t override state laws unless they directly conflict. And stricter state laws are not considered inconsistent — meaning businesses still need to comply with state-level pricing and disclosure requirements that offer greater consumer protection.

In parallel with the Rule’s rollout, the FTC and U.S. Department of Justice recently announced they are seeking public input on harmful practices in the live ticketing industry, pursuant to President Trump’s March 2025 executive order aimed at ensuring transparency throughout the ticket-buying process. 

The bottom line:  Businesses should take immediate steps to ensure their pricing practices are transparent, accurate, and aligned with the FTC’s new Rule and other applicable laws. With heightened regulatory scrutiny, growing class action activity, and steep penalties for violations, now is the time to review how prices are presented—before consumers or enforcers do it for you.