FTC warns speculative ticket sellers, clarifies fee rules

The Federal Trade Commission last week issued an FAQ clarifying its “Rule on Unfair or Deceptive Fees.” In it, the FTC warns speculative ticket sellers and clarifies fee transparency rules.

FTC warns speculative ticket sellers, clarifies fee rules

The FTC Rule prohibits bait-and-switch pricing, hidden fees, and other tactics used to obscure and misrepresent total prices and fees for both live-event tickets and short-term lodging.

Key Impacts on Concert Ticketing

The FTC Rule applies to all sellers of live-event tickets, including primary sellers, venues, and third-party resellers.

• Transparent Pricing: Ticket sellers must now include all mandatory fees in the initial advertised price, ensuring consumers see the total cost upfront.
• Prominent Display: The total price, inclusive of all fees, must be displayed more prominently than any other pricing information, preventing misleading lower prices from attracting consumers.
• Disclosure of Additional Charges: While government-imposed taxes and optional services (like shipping or parking) can be excluded from the advertised price, these must be clearly disclosed before the consumer proceeds to payment.

Speculative Tickets Warning: FTC vs. TICKET Act

While not a clear ban, the FTC appears to go farther toward prohibiting speculative ticketing than the TICKET which overwhelmingly passed the House and is headed to be Senate.

Included in the new FTC FAQ are “examples of misrepresentations that may violate the Rule” with speculative ticket sellers on the shortlist

“A speculative ticket seller advertises it has tickets available for a sold-out concert at a certain price but doesn’t actually have those tickets. In this case, the tickets are not “available” at the time the business made the offer.”

The Ticket Act

In contrast to the FTC warning, The TICKET Act carves out a specific exception for so-called concierge ticket buying services as long as they “disclose to consumers if a ticket being offered for sale is a speculative ticket and that the seller does not have actual or constructive possession of the ticket.”

Independent live music trade groups including NITO and NIVA oppose the TICKET Act in large part because the exception.

“Unfortunately the inclusion of a ‘concierge service’ carveout, as written in the TICKET Act, would undermine the speculative ticket ban,” says Stephen Parker, NIVA Executive Director. “Concierge services should not be a loophole for companies like Vivid Seats to claim they are offering a service while selling “tickets” they don’t possess to unsuspecting fans. 

Bruce Houghton is the Founder and Editor of Hypebot, a Senior Advisor at Bandsintown, a Berklee College Of Music professor and founder of the Skyline Artists Agency

FTC warns speculative ticket sellers, clarifies fee rules first appeared on Hypebot.com