New rules banning ‘junk fees’ are now in effect in Mass. Here’s what to know.

Business

Businesses are required to disclose all fees before consumers provide personal information as of Tuesday.

“Junk fees” are banned in Massachusetts as of Tuesday. 

Junk fees are “hidden, surprise, or unnecessary costs that increase the total price of a product beyond the advertised price” that businesses often don’t disclose until the end of the transaction,” according to the state Attorney General’s Office.

“Similarly, some businesses have engaged in practices related to trial offers, subscriptions, and automatic and recurring charges to conceal the total cost and nature of a product or service, while making it difficult for consumers to cancel or opt-out of such features.”

From additional renter’s fees to online trial offers, any undisclosed fees listed after a consumer provides personal information are now a violation of the  Massachusetts Consumer Protection Act.

“Today, as we build upon the Commonwealth’s nation-leading legacy of consumer protection, we make clear that ‘junk fees’ and deceptive pricing are not lawful,” Attorney General Andrea Campbell said in a release. “Amidst rising costs, these historic regulations not only provide individuals upfront transparency about the true cost of a good or service, but level the playing field for businesses by promoting trust and fair competition”

The new rules were announced in March.

“Unexpected and confusing, junk fees have proliferated across the economy, costing families at least tens of billions of dollars each year,” said Ariel Nelson, senior attorney at the National Consumer Law Center in Boston, at a March press conference regarding the rules. “These fees obscure the true price of goods and services, prevent comparison shopping, and make a profit off of gotchas.”

For trial offers, the business must disclose the charge amount, charge date, and the deadline to cancel before a charge occurs.

For recurring charges and subscriptions, the business must disclose the charge amount, instructions for cancellation, and whether or not fees will increase after a certain period. 

Consumers who believe they were unfairly charged a “junk fee” can file a complaint or call the attorney general’s Consumer Hotline at 617-727-8400. 

Breakdown of the new rules:

The new rules will require a business to disclose information as follows: 

• A consumer must be presented with the total price of a product, including all mandatory charges or fees, before they provide personal information;
• Any charges imposed on a transaction, including their nature, purpose, and amount, must be disclosed;
• Whether any charges are optional or waivable, along with instructions on how to avoid them.

On trial offers and automatic renewals, the business must inform customers on:

• Any charges a consumer may incur as a result of accepting a trial offer;

• Any products for which charges may incur as a result;
• Instructions on how to reject or cancel a trial offer;
• The calendar date by which a consumer must reject or cancel the offer;
• The date the company will charge the customer if they fail to reject or cancel.

On recurring charges and subscriptions, businesses must disclose:

• What charges consumers will incur and whether any fees will increase after a certain period;
• If charges will occur regularly, unless cancelled;
• Instructions on how to cancel a recurring charge or subscription.