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New Law to Prohibit “Hidden Fees”

Certainly you’ve experienced it before: you find a good deal online and decide to make the purchase only to discover later on in the buying process that there are additional undisclosed fees. The price you thought you were paying isn’t the real price. But now you’ve invested time into the purchase. Maybe you’ve provided your email address, or even your credit card information. You’ve been duped by hidden fees.

People are fed up with hidden fees. Thankfully, California lawmakers have gotten the message and are making efforts to address this unfair and deceptive business practice. On February 14th, California Attorney General Rob Bonta introduced the Senate Bill 478 (SB 478). Right now, SB 478 is just a proposedpiece of legislation. But if it passes in the California Senate, SB 478 will prohibit businesses from hiding mandatory fees when advertising the prices of their products online.

The use of hidden fees gives a business an unfair advantage over their more transparent competitors. More importantly, the use of hidden fees is highly unfair to consumers who are trying to make purchase decisions based on price and who don’t want to give personal information and credit card details to companies they ultimately are not going to buy from.

SB 478 is the first bill of its kind. If passed, it will prohibit a business from advertising a price for a good or service that does not include all required charges with the exception of government imposed taxes and fee.

Attorney General Rob Bonta explained when announcing the bill:

“Unfortunately, from car rental and hotel fees to concert ticket service charges, these hidden costs have been normalized in the purchasing process. Today’s legislation seeks to hold businesses accountable for their deceptive and misleading practices at the expense of the financial security of millions of Californians. My office will continue to work tirelessly to ensure an equal, level playing field and demand transparency across the board for the protection of California consumers.”

As a law firm that prides itself on protecting the rights of the individual, we fully support Attorney General Bonta’s efforts to pass SB 478 and we hope the bill is approved in the State Senate. The full text of the bill can be viewed here.


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