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SB1035
THE SENATE
S.B. NO.
1035
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:
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SECTION 1.
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The legislature finds that, as the cost of
living continues to increase in the State, it is necessary for the State to
intervene in markets where retailers and goods and services providers are
treating consumer unfairly.
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The ability
to identify the price of a good or service is a necessity for a properly
functioning economy.
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Consumers look for
prices to comparison shop and to weigh what a good or service might be worth.
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Most consumers rely on price to answer
critical questions around how much they are able to spend and save, and how
they will meet their basic needs and those of their families.
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The
legislature also finds that consumers increasingly face widespread and growing
unfair and deceptive fee practices that make it harder to identify how much
something will ultimately cost.
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Unfortunately,
the Internet and the ability to purchase goods or services online have only exacerbated
the practice of charging mandatory "junk fees" that are not disclosed
until after the transaction begins.
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The
practice of charging junk fees and other undisclosed mandatory costs is called
"drip pricing".
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Drip pricing is
most prevalent in practices involving fees for live-event tickets and
short-term lodging and other places of temporary sleeping accommodations, such
as hotels, motels, inns, short-term rentals, and vacation rentals.
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The
legislature further finds that according to the Federal Trade Commission, in
the last few years alone, tens of thousands of Americans have cried foul when
they discovered the cost of their hotel stays were significantly higher than
expected due to hidden resort fees and other mandatory charges in addition to
the advertised price.
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Consumers have
also complained about purchasing tickets to a live-event online and finding out
that the quoted ticket price was almost doubled by the time they reached the
final checkout page.
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Consumers have
confronted a host of mysterious, mandatory charges labeled as
"convenience", "processing", or "service" fees
that are nondescriptive and confusing.
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These practices are frustrating for consumers when they shop for travel
and entertainment, especially because these purchases can be significant
expenditures to their already strained finances.
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The
legislature further finds that the Federal Trade Commission recently issued a
final trade regulation rule to address certain unfair or deceptive practices
involving fees or charges for live-event tickets and short-term lodging.
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This rule serves as a guidance for the State to
enhance its consumer protection laws and allow consumers to make better
informed purchasing decisions when purchasing live-event tickets or deciding
where to stay on a short-term basis by leveling the
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playing field for honest businesses in these
industries that truthfully and transparently disclose their pricing
information.
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Accordingly,
the purpose of this Act is to:
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(1)
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Require businesses that offer a price
for live-event tickets or short-term lodging to disclose the total price,
inclusive of most mandatory charges, and to ensure that the total price is
disclosed more prominently than other pricing information, except the final
amount of payment; and
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(2)
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Prohibit misrepresentations about fees
or charges in any offer, display, or advertisement for the sale of live-event
tickets and short-term lodging.
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SECTION
2.
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Chapter 481B, Hawaii Revised
Statutes, is amended by adding a new section to part I to be appropriately
designated and to read as follows:
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481B-
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Unfair or deceptive practices; junk fees prohibited.
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(a)
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No business shall offer, display, or advertise any price of a covered
good or service without clearly and conspicuously disclosing the total price.
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(b)
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In any offer, display, or advertisement that
represents any price of a covered good or service, a business shall disclose
the total price more prominently than any other pricing information.
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(c)
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A business shall disclose clearly and
conspicuously, before the consumer consents to pay for any covered good or
service:
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(1)
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The nature, purpose, and amount of
any fee or charge imposed on the transaction that has been excluded from the
total price and the identity of the good or service for which the fee or charge
is imposed; and
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(2)
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The final amount of payment for the
transaction.
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(d)
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The disclosure required pursuant to
subsection (c) shall be subject to the following:
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(1)
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In any communication that is solely
visual or solely audible, the disclosure shall be made through the same means
through which the communication is presented. In any communication made through
visual and audible means, such as a television advertisement, the disclosure shall
be presented simultaneously in both the visual and audible portions of the
communication, even if the representation requiring the disclosure is made in
only one means;
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(2)
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A visual disclosure, by its size,
contrast, location, the length of time it appears, and other characteristics, shall
stand out from any accompanying text or other visual elements so that it is
easily noticed, readable, and understandable;
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(3)
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An audible disclosure, including by
telephone or streaming video, shall be delivered in a volume, speed, and
cadence that is sufficiently and easily hearable and understandable for
ordinary consumers;
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(4)
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In any communication using an
interactive electronic medium, such as the Internet, a mobile application, or
software, the disclosure shall be unavoidable;
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(5)
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The disclosure shall use diction and
syntax understandable to ordinary consumers and shall appear in each language
in which the representation that requires the disclosure appears;
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(6)
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The disclosure shall comply with
these requirements in each medium through which it is received, including all
electronic devices and face-to-face communications; and
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(7)
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The disclosure shall not be
contradicted or mitigated by, or inconsistent with, other content in the
communication;
provided
that, when the representation or sales practice targets a specific audience,
such as children, older adults, or the terminally ill, members of that group
shall be considered ordinary consumers.
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(e)
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In any offer, display, or advertisement for a
covered good or service, it shall be an unfair or deceptive practice in
violation of this section for any business to misrepresent any fee or charge,
including but not limited to:
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(1)
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The nature, purpose, amount, or
refundability of any fee or charge; and
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(2)
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The identity of the good or service
for which the fee or charge is imposed.
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(f)
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For the purposes of this section:
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"Business"
means a person that offers goods or services, whether online, via mobile
applications, or at physical locations.
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"Clearly
and conspicuously" refers to a required disclosure that is made easily
noticeable (i.e., difficult to miss) and easily understandable by ordinary consumers.
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"Covered
goods or services" means:
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(1)
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Live-event tickets; or
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(2)
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Short-term lodging, including
temporary sleeping accommodations at a hotel, motel, inn, short-term rental,
vacation rental, or other place of lodging.
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"Government
charges" means the fees or charges imposed on the transaction by a
federal, state, tribal, or local government agency, unit, or department.
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"Pricing
information" means any information relating to an amount that a consumer
may pay.
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"Shipping
charges" means the fees or charges that reasonably reflect the amount a
business incurs to send physical goods to a consumer, including through the
mail, private mail and shipping services, or by freight.
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"Total
price" means the maximum total of all fees or charges a consumer would pay
for any good or service; provided that government charges, shipping charges,
and fees or charges for any optional goods or services may be excluded.
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SECTION 3.
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This Act does not affect rights and duties
that matured, penalties that were incurred, and proceedings that were begun
before its effective date.
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SECTION
4.
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New statutory material is
underscored.
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SECTION
5.
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This Act shall take effect upon its
approval.
INTRODUCED BY:
_____________________________
Report Title:
Consumer
Protection; Live-Event Tickets; Short-Term Lodging; Booking Transactions; Disclosures;
Drip Pricing; Junk Fees
Description:
Requires businesses to clearly and conspicuously disclose
the total price of all fees or charges that a consumer may have to pay for any
live-event tickets or short-term lodging before the consumer consents to
pay.
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Prohibits any business from
charging a consumer any additional hidden or mandatory fees that were not
disclosed before the time of purchase.
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Prohibits a business from offering, displaying, or advertising any
covered goods or services without clearly and conspicuously disclosing the
total price.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.