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ARTICLE · 28 FEBRUARY 2024

California Bans Hidden Fees

Fenwick
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Beginning July 1, 2024, businesses that transact with California consumers may not apply additional fees or charges at checkout that were not disclosed in the advertised price...

United StatesConsumer Protection
Vejay Lalla
Vejay Lalla
Kimberly Culp
Kimberly Culp
Monica Kim
Monica Kim
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What You Need To Know

  • Effective July 1, 2024, California's Consumer Legal Remedies Act (CLRA) will include another prohibited practice designed to prevent "drip pricing," which is the practice of revealing charges gradually throughout the buying process.
  • "Drip pricing" was previously declared a deceptive and unfair practice that can trigger an enforcement action from the Federal Trade Commission. While it exists in many industries, it is most often seen in the e-commerce setting.
  • Businesses that transact with California consumers should take steps to remedy their use of "drip pricing" to avoid the risk of consumer class action under the CLRA, including by:
    • Ensuring that all advertised prices state the full price, inclusive of any fees.

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