Read the full stored bill text
HB321
HOUSE OF REPRESENTATIVES
H.B. NO.
321
THIRTY-THIRD LEGISLATURE, 2025
STATE OF HAWAII
A BILL FOR AN ACT
reLATING
TO consumer protection
.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
����
SECTION 1.
�
The
legislature finds that providers of transient accommodations are adding junk
fees to their advertised rates and prices.
�
Junk fees are hidden and bogus fees that are designed to either confuse
or deceive consumers or to take advantage of lock-in or other forms of
situational market power.
�
Some examples
of junk fees include mandatory fees that are not disclosed until after a
transaction commences, surprise fees that consumers learn about after purchase,
excessive fees that target consumers who have limited alternative options, and
fraudulent fees of which their nature and purpose are misrepresented by the
seller.
�
Common undisclosed mandatory fees
include hotel resort fees and airline baggage and change fees.
�
These hidden mandatory fees prevent consumers
from making informed purchases and knowing how much they are to pay for lodging
or airfare.
�
A 2022 report from the White
House estimates that Americans have paid over $8,000,000,000 in hotel and
airline junk fees annually.
�
����
The practice of charging an undisclosed
mandatory fee in addition to the advertised price after the purchase process
begins is called "drip pricing".
�
Drip pricing misleads consumers of the actual amount they are to pay for
a product or service.
�
Studies have found
that drip pricing inhibits price competition, while resulting in consumers
paying more for a product or service than they initially would have had the
actual and total price been advertised.
�
Drip pricing can also create an uneven playing field for businesses by
making small and medium companies that price in a fair and transparent manner
seem more expensive than their rivals.
�
Drip pricing additionally incentivizes companies to engage in
"exploitative innovation", where new junk fees are developed rather
than the quality of the product or service.
����
The legislature notes that there is
national support to reduce and eliminate the practice of drip pricing.
�
For example, the federal Junk Fee Prevention
Act, S. 916. 118th Cong. (2023) was introduced to curb and eliminate excessive,
hidden, and unnecessary fees that are unexpectedly imposed on consumers.
�
California recently passed the Consumers
Legal Remedies Act, 2023, which would make it unlawful to advertise, display,
or offer a price for a product or service that does not include all mandatory
fees or charges, with exceptions.
�
In
October 2023, the Federal Trade Commission proposed a new trade regulation rule
entitled the "Rule on Unfair or Deceptive Fees" that would prohibit
businesses from advertising prices that hide or omit disclosing mandatory fees,
prohibit sellers from misrepresenting fees, and require sellers to disclose
upfront the amount and purpose of the fees and whether the fees are refundable.
�
The legislature believes that
prohibiting people who pay transient accommodations taxes from charging fees
that were not disclosed at the time of purchase and instead requiring them to
fully disclose the rate that a consumer is expected to pay upfront will protect
consumers from deceptive trade practices.
����
Accordingly, the purpose of this Act is to:
����
(1)
�
Prohibit any
person from charging any fees on a transient accommodation or resort time share
vacation interest, plan, or unit that were not disclosed before the time of
purchase;
����
(2)
�
Require
a person to clearly and conspicuously display a rate or price that includes all
fees to be charged at the time of purchase in each advertisement for a
transient accommodation or resort time share vacation interest, plan, or unit;
and
����
(3)
�
Require
any taxes and fees that are displayed as a percentage of the cost on a booking
transaction also be displayed as a dollar amount at the time of purchase.
����
SECTION 2.
�
Chapter 481B, Hawaii Revised Statutes, is amended by adding a new
section to part I to be appropriately designated and to read as follows:
����
"
�481B-
�
Transient
accommodations; booking transactions; total price; disclosures; junk fees.
�
(a)
�
No person shall charge any fee
for
a transient accommodation or resort time share
vacation interest, plan, or unit
that was not disclosed before the time of
purchase.
����
(b)
�
A person shall clearly and
conspicuously display a rate or price that includes all fees to be charged at
the time of purchase in each advertisement for a transient accommodation or
resort time share vacation interest, plan, or unit, including online
advertisements.
����
(c)
�
Any taxes and fees on a booking transaction that are displayed as a
percentage of the cost at the time of purchase shall also be displayed as a
dollar amount.
����
(d)
�
For the purposes of this
section:
����
"Booking transaction" means any transaction in which there is a
charge to a consumer by a taxpayer for any transient accommodation or resort
time share vacation interest, plan, or unit.
����
"Government entity" has the same meaning as defined in section
137-1.
����
"Resort time share vacation interest", "resort time share
vacation plan", "resort time share vacation unit", and
"transient accommodations" have the same meanings as defined in
section 237D-1.
"
����
SECTION 3.
�
This Act does not affect rights and duties that matured, penalties that
were incurred, and proceedings that were begun before its effective date.
����
SECTION 4.
�
New statutory material is underscored.
����
SECTION 5.
�
This Act shall take effect upon its approval.
INTRODUCED BY:
_____________________________
Report Title:
Consumer
Protection; Transient Accommodations; Booking Transactions; Drip Pricing;
Disclosures; Junk Fees
Description:
Prohibits any person from charging any fees on a transient
accommodation or resort time share vacation interest, plan, or unit that were
not disclosed before the time of purchase.
�
Requires a person to clearly and conspicuously display a rate or price
that includes all fees to be charged at the time of purchase in each
advertisement for a transient accommodation or resort time share vacation
interest, plan, or unit.
�
Requires any
taxes and fees that are displayed as a percentage of the cost on a booking
transaction also be displayed as a dollar amount at the time of purchase.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.