As the pressure mounts from U.S. legislators to crack down on “junk fees” in the hospitality industry, leaders within the sector are embracing the idea of regulation. The American Hotel & Lodging Association CEO, Chip Rogers, emphasizes the importance of having a level playing field for all entities in the lodging industry. He believes that while the disclosure of fees upfront is crucial, it should apply equally to hotels, short-term rentals, and online travel agencies. The association has actively worked with lawmakers to ensure that the Junk Fee Prevention Act, introduced by Sens. Richard Blumenthal and Sheldon Whitehouse, addresses all concerns regarding mandatory fees. Under this bill, accommodations providers would be obligated to clearly display the total price of their services in all advertisements and initial price displays, eliminating any hidden fees.
Marriott International’s CEO, Anthony Capuano, echoes similar sentiments concerning the transparent display of mandatory fees. Marriott had to incorporate mandatory fees into its room rates following a consumer-protection investigation. Capuano stresses the need for a fair regulatory environment that includes all travel providers and intermediaries, not just branded companies like Marriott. While being pro-transparency about fees, Capuano disagrees with categorizing resort fees as “junk fees.” He argues that their fees are a result of a rigorous process that focuses on providing real value to customers. Marriott makes proposals for these fees, which are reviewed for meaningful and demonstrated value before approval.
Aside from the Junk Fee Prevention Act, the Federal Trade Commission also proposed a rule to eliminate unfair or deceptive fees in the industry. The American Society of Travel Advisors (ASTA) supports this rule and advocates for consistent fee transparency across all booking channels. Peter Lobasso, ASTA’s senior vice president, emphasizes that consumers should receive complete pricing information regardless of their booking medium. In California, Gov. Gavin Newsom signed a bill banning businesses from advertising prices that do not include all mandatory fees, supporting the movement towards increased transparency in the industry.
While California has taken steps towards addressing the issue of junk fees, the AHLA hopes that the Junk Fee Prevention Act will provide a more comprehensive, nationwide solution. Rogers expresses concerns about the potential patchwork of regulations if other states follow California’s lead. He highlights the difficulty in moving legislation forward in Washington, despite bipartisan support, leaving the bill stagnant. The ultimate goal is to create a uniform regulatory framework that promotes transparency and equality across the lodging sector.
The hospitality industry is at a crucial juncture where regulation is seen as a necessary step towards enhancing consumer protection and promoting fair competition. The push for transparency regarding mandatory fees and the call for equal application of regulations across all entities reflect a growing awareness of the need for reform within the sector. By working together with lawmakers and industry stakeholders, the hospitality industry can pave the way for a more accountable and consumer-centric approach to pricing practices.
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