SB1035 SD1

SECTION 1. 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. The ability to identify the price of a good or service is a necessity for a properly functioning economy. Consumers look for prices to comparison shop and to weigh what a good or service might be worth. 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.

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. 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. The practice of charging junk fees and other undisclosed mandatory costs is called "drip pricing". 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.

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. 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. Consumers have confronted a host of mysterious, mandatory charges labeled as "convenience", "processing", or "service" fees that are nondescriptive and confusing. 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.

The legislature additionally 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. 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 playing field for honest businesses in these industries that truthfully and transparently disclose their pricing information.

Accordingly, the purpose of this Act is to:

(1) 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

(2) Prohibit misrepresentations about fees or charges in any offer, display, or advertisement for the sale of live-event tickets and short-term lodging.

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- Unfair or deceptive practices; junk fees prohibited. (a) No business shall offer, display, or advertise any price of a covered good or service without clearly and conspicuously disclosing the total price.

(b) 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, except the final amount of payment.

(c) A business shall disclose clearly and conspicuously, before the consumer consents to pay for any covered good or service:

(1) 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

(2) The final amount of payment for the transaction.

(d) The disclosure required pursuant to subsection (c) shall be subject to the following:

(1) 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;

(2) 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;

(3) 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;

(4) In any communication using an interactive electronic medium, such as the Internet, a mobile application, or software, the disclosure shall be unavoidable;

(5) 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;

(6) 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

(7) 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.

(e) 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:

(1) The nature, purpose, amount, or refundability of any fee or charge; and

(2) The identity of the good or service for which the fee or charge is imposed.

(f) For the purposes of this section:

"Business" means a person that offers goods or services, whether online, via mobile applications, or at physical locations.

"Clearly and conspicuously" refers to a required disclosure that is made easily noticeable (i.e., difficult to miss) and easily understandable by ordinary consumers.

"Covered goods or services" means:

(1) Live-event tickets; or

(2) Short-term lodging, including temporary sleeping accommodations at a hotel, motel, inn, short-term rental, vacation rental, or other place of lodging.

"Government charges" means the fees or charges imposed on the transaction by a federal, state, tribal, or local government agency, unit, or department.

"Pricing information" means any information relating to an amount that a consumer may pay.

"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.

"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."

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.

THE SENATE	S.B. NO.	1035
THIRTY-THIRD LEGISLATURE, 2025		S.D. 1
STATE OF HAWAII