On Tuesday, December 17, 2024, the U.S. Federal Trade Commission (FTC) introduced a new rule aimed at putting an end to hidden "junk fees" in hotel stays, vacation rentals, and event ticketing.  The rule was passed and published in the Federal Register on January 10, 2025 with its effective date 120 days later.  Pending any changes from the current Administration or Congress,  starting May 10 2025 all required charges—like resort fees or cleaning fees—must be clearly shown at the beginning of the booking process, not tacked on at the end. The goal is to crack down on what's known as “drip pricing,” where the price appears lower until the final checkout page.

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This move follows similar legislation passed in 2024 in California and Minnesota and could mark a big shift for the travel and hospitality industry. For hotels, it’s a chance to build stronger guest trust, compete more fairly with online travel agencies, and boost direct bookings. That said, implementing these changes across operations might come with a few growing pains.

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So, what are hotel junk fees, exactly?

 

They’re any extra charges that guests are required to pay but that aren’t included in the listed room rate. The usual suspects are resort fees and, in the case of short-term rentals, cleaning fees pop up a lot too. If your property in the U.S. is currently adding these kinds of fees separately—whether on your website, metasearch listings, or other direct booking channels—you’ll need to update your pricing to show the full cost upfront.

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One important thing to remember: this new rule doesn’t apply to taxes or government-mandated charges. Those don’t need to be included in the initial rate shown.

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The challenge for hotels—and how to get ahead of it

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While this new rule could boost guest trust and help level the playing field with online travel agencies in the long run, the initial rollout might bring some hiccups—especially around how pricing is displayed. When California introduced a similar rule, we saw hotels take a variety of approaches. The key is choosing a clear, upfront pricing strategy that fits your broader goals and brand voice.

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The good news? We’ve had the chance to learn from how California hotels handled the shift. Here are a few tips to help you get ready for what’s coming:

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• Double-check your booking engine setup. Make sure your platform is fully updated—both on the pricing backend and in how fees are messaged to guests. Reach out to your booking engine provider to confirm they’re on top of the new compliance requirements.

• Frame the value behind the fee. Don’t just list the charge—highlight what guests are getting for it. Whether it’s spa access, complimentary drinks, or in-room perks, make sure guests see the benefit.

• Get your pricing right across all channels. Ensure your base rates and added fees are properly set up with Google and any other metasearch engines you use, so you don’t run into issues or penalties when the rule takes effect.

• Keep your marketing in sync. Update your ad copy and promotional content to reflect the full cost, including any fees, so there are no surprises for your guests.

• Educate your team. Make sure everyone from marketing to reservations understands what the FTC ruling means and how it impacts pricing, so future efforts stay compliant.

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For questions or help on updating rates in your SynXis CRS contact your Revenue Architect today or our support box at support@cohores.com

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