USCC Unfair Deceptive Fee NPRM Comments
February 07, 2024
To Whom it May Concern:
The U.S. Chamber of Commerce (“Chamber”) appreciates the opportunity to comment to the Federal Trade Commission (“FTC” or “Commission”) regarding its proposed “Rule on Unfair or Deceptive Fees” (“Proposed Rule” or “NPRM”). The NPRM proposes imposing an economy-wide rule to regulate and prohibit so-called “hidden fees” and “misrepresented fees.”
The Chamber supports transparency in pricing. Businesses cannot be allowed to misrepresent the total cost of a product or service, or to charge consumers for products or services they did not agree to purchase. Consumers should understand what they are purchasing, and the costs associated with the purchase. However, the Proposed Rule lacks clarity regarding its application, and as written, would be technically impossible for some industries to implement, and has the potential to chill legitimate pricing practices in an attempt to cure consumer frustrations with fees.
Several factors underlie the Chamber’s assessment that the proposed rulemaking is potentially unlawful. Specifically, the NPRM implicates the Major Questions Doctrine, which requires a clear grant of rulemaking authority that Congress has not yet provided and fails to comport with the FTC Act’s Section 18 rulemaking procedures. Aside from legal considerations, the Chamber is concerned the NPRM’s economy-wide scope raises several practical issues including the risk of duplicative and overlapping regulatory regimes for certain sectors, and chilling or even prohibiting legitimate business practices. Moreover, the Commission has crafted a rule without an existing enforcement record to test the Commission’s conclusions about harmful practices or indicate limits around deceptive disclosures or incomplete pricing information.
The structure of pricing, and the level of prices, should be determined by competition in the marketplace. Competition over pricing structures is more likely to satisfy consumer preferences than overbroad regulatory requirements. Consequently, the Chamber believes that the FTC should withdraw this rulemaking. If the FTC is unwilling to withdraw the rulemaking, the Chamber identifies several areas that need further clarification and offers revisions to the Proposed Rule to better reflect the rulemaking record.
Full comment letter available here.