Hotel Advertising Transparency Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4489 To prohibit unfair and deceptive advertising of rates for hotel rooms and other places of short-term lodging. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 25, 2019 Ms. JOHNSON of Texas (for herself, Mr. FORTENBERRY, and Ms. BASS) intro- duced the following bill; which was referred to the Committee on Energy and Commerce A BILL To prohibit unfair and deceptive advertising of rates for hotel rooms and other places of short-term lodging. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Hotel Advertising 4 Transparency Act of 2019’’. 5 SEC. 2. FINDINGS. 6 Congress makes the following findings: 7 (1) As of the day before the date of the enact- 8 ment of this Act, hotel rooms and other places of 9 lodging are often advertised at a rate and later in 10 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 2 •HR 4489 IH the buying process mandatory fees are disclosed that 1 were not included in the advertised room rate. 2 (2) The mandatory fees described in paragraph 3 (1) are sometimes called by names such as ‘‘resort 4 fees’’, ‘‘cleaning fees’’, or ‘‘facility fees’’ and they are 5 all mandatory and charged by a place of short-term 6 lodging in addition to advertised room rates. 7 (3) The number of short-term lodging facilities 8 that charged mandatory resort fees is growing. 9 (4) Advertising that does not reflect the true 10 mandatory cost of a stay at a place of short-term 11 lodging is deceptive. 12 (5) The Federal Trade Commission has author- 13 ity under section 5 of the Federal Trade Commis- 14 sion Act (15 U.S.C. 45) to regulate and prohibit un- 15 fair or deceptive acts or practices in or affecting 16 commerce. 17 (6) In 2012 and 2013, the Federal Trade Com- 18 mission exercised its authority under that section 5 19 to issue warning letters to 35 hotel operators and 11 20 online travel agents. In those letters, the Commis- 21 sion cautioned hotel operators and online travel 22 agents that mandatory resort fees could confuse con- 23 sumers in violation of section 5(a)(2) of such Act 24 (15 U.S.C. 45(a)(2)). 25 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 3 •HR 4489 IH (7) In 2017, an economist at the Federal Trade 1 Commission published an issue paper that found 2 that forcing consumers to click through additional 3 webpages to see a hotel’s resort fee increases the 4 time spent searching and learning the hotel’s price, 5 and went on to state the following: ‘‘Separating the 6 room rate from the resort fee increases the cognitive 7 costs of remembering the hotel’s price. When it be- 8 comes more costly to search and evaluate an addi- 9 tional hotel, a consumer’s choice is either to incur 10 higher total search and cognitive costs or to make an 11 incomplete, less informed decision that may result in 12 a more costly room, or both.’’ 13 SEC. 3. PROHIBITION ON UNFAIR AND DECEPTIVE ADVER- 14 TISING OF HOTEL ROOM RATES. 15 (a) PROHIBITION.—No person with respect to whom 16 the Federal Trade Commission is empowered under sec- 17 tion 5(a)(2) of the Federal Trade Commission Act (15 18 U.S.C. 45(a)(2)) may advertise in interstate commerce a 19 rate for a place of short-term lodging that does not include 20 all required fees, excluding taxes and fees imposed by a 21 government. 22 (b) ENFORCEMENT BY FEDERAL TRADE COMMIS- 23 SION.— 24 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 4 •HR 4489 IH (1) UNFAIR OR DECEPTIVE ACTS OR PRAC- 1 TICES.—A violation of subsection (a) by a person 2 subject to such subsection shall be treated as a viola- 3 tion of a rule defining an unfair or deceptive act or 4 practice prescribed under section 18(a)(1)(B) of the 5 Federal Trade Commission Act (15 U.S.C. 6 57a(a)(1)(B)). 7 (2) POWERS OF COMMISSION.— 8 (A) IN GENERAL.—The Federal Trade 9 Commission shall enforce this section in the 10 same manner, by the same means, and with the 11 same jurisdiction, powers, and duties as though 12 all applicable terms and provisions of the Fed- 13 eral Trade Commission Act (15 U.S.C. 41 et 14 seq.) were incorporated into and made a part of 15 this Act. Any person who violates this section 16 shall be subject to the penalties and entitled to 17 the privileges and immunities provided in the 18 Federal Trade Commission Act (15 U.S.C. 41 19 et seq.). 20 (B) RULEMAKING.— 21 (i) IN GENERAL.—The Commission 22 may promulgate such rules as the Commis- 23 sion considers appropriate to enforce this 24 section. 25 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 5 •HR 4489 IH (ii) PROCEDURES.—The Commission 1 shall carry out any rulemaking under 2 clause (i) in accordance with section 553 of 3 title 5, United States Code. 4 (c) ENFORCEMENT BY STATES.— 5 (1) IN GENERAL.—In any case in which the at- 6 torney general of a State has reason to believe that 7 an interest of the residents of the State has been or 8 is threatened or adversely affected by the engage- 9 ment of any person subject to subsection (a) in a 10 practice that violates such subsection, the attorney 11 general of the State may, as parens patriae, bring 12 a civil action on behalf of the residents of the State 13 in an appropriate district court of the United States 14 to obtain appropriate relief. 15 (2) RIGHTS OF FEDERAL TRADE COMMIS- 16 SION.— 17 (A) NOTICE TO FEDERAL TRADE COMMIS- 18 SION.— 19 (i) IN GENERAL.—Except as provided 20 in clause (iii), the attorney general of a 21 State shall notify the Commission in writ- 22 ing that the attorney general intends to 23 bring a civil action under paragraph (1) 24 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 6 •HR 4489 IH before initiating the civil action against a 1 person subject to subsection (a). 2 (ii) CONTENTS.—The notification re- 3 quired by clause (i) with respect to a civil 4 action shall include a copy of the complaint 5 to be filed to initiate the civil action. 6 (iii) EXCEPTION.—If it is not feasible 7 for the attorney general of a State to pro- 8 vide the notification required by clause (i) 9 before initiating a civil action under para- 10 graph (1), the attorney general shall notify 11 the Commission immediately upon insti- 12 tuting the civil action. 13 (B) INTERVENTION BY FEDERAL TRADE 14 COMMISSION.—The Commission may— 15 (i) intervene in any civil action 16 brought by the attorney general of a State 17 under paragraph (1) against a person de- 18 scribed in such paragraph; and 19 (ii) upon intervening— 20 (I) be heard on all matters aris- 21 ing in the civil action; and 22 (II) file petitions for appeal of a 23 decision in the civil action. 24 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 7 •HR 4489 IH (3) INVESTIGATORY POWERS.—Nothing in this 1 subsection may be construed to prevent the attorney 2 general of a State from exercising the powers con- 3 ferred on the attorney general by the laws of the 4 State to conduct investigations, to administer oaths 5 or affirmations, or to compel the attendance of wit- 6 nesses or the production of documentary or other 7 evidence. 8 (4) EFFECT ON STATE COURT PROCEEDINGS.— 9 Nothing in this subsection shall be construed to pro- 10 hibit an authorized State official from proceeding in 11 State court on the basis of an alleged violation of 12 any general civil or criminal statute of such State. 13 (5) COORDINATION WITH FEDERAL TRADE 14 COMMISSION.—If the Federal Trade Commission in- 15 stitutes a civil action or an administrative action 16 with respect to a violation of subsection (a), the at- 17 torney general of a State shall coordinate with the 18 Commission before bringing a civil action under 19 paragraph (1) against any defendant named in the 20 complaint of the Commission for the violation with 21 respect to which the Commission instituted such ac- 22 tion. 23 (6) VENUE; SERVICE OF PROCESS.— 24 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 8 •HR 4489 IH (A) VENUE.—Any action brought under 1 paragraph (1) may be brought in— 2 (i) the district court of the United 3 States that meets applicable requirements 4 relating to venue under section 1391 of 5 title 28, United States Code; or 6 (ii) another court of competent juris- 7 diction. 8 (B) SERVICE OF PROCESS.—In an action 9 brought under paragraph (1), process may be 10 served in any district in which the defendant— 11 (i) is an inhabitant; or 12 (ii) may be found. 13 (7) ACTIONS BY OTHER STATE OFFICIALS.— 14 (A) IN GENERAL.—In addition to civil ac- 15 tions brought by attorneys general under para- 16 graph (1), any other officer of a State who is 17 authorized by the State to do so may bring a 18 civil action under paragraph (1), subject to the 19 same requirements and limitations that apply 20 under this subsection to civil actions brought by 21 attorneys general. 22 (B) SAVINGS PROVISION.—Nothing in this 23 subsection may be construed to prohibit an au- 24 thorized official of a State from initiating or 25 VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS 9 •HR 4489 IH continuing any proceeding in a court of the 1 State for a violation of any civil or criminal law 2 of the State. 3 (d) DEFINITIONS.—As used in this Act— 4 (1) the term ‘‘place of short-term lodging’’ 5 means a hotel, motel, inn, or other place of lodging 6 that advertises at a rate that is a nightly, hourly, or 7 weekly rate; and 8 (2) the term ‘‘State’’ includes any territory of 9 the United States, the District of Columbia, and the 10 Commonwealth of Puerto Rico. 11 (e) EFFECTIVE DATE.—Subsection (a) shall take ef- 12 fect on the date that is 30 days after the date of enact- 13 ment of this Act. 14 Æ VerDate Sep 11 2014 20:46 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6301 E:\BILLS\H4489.IH H4489 lotter on DSKBCFDHB2PROD with BILLS