2025 FTC Rule Changes: What Businesses Must Know
Stay ahead of the 2025 FTC rule changes with clear, actionable compliance strategies for pricing, data, and advertising.
Understanding the 2025 FTC Rule Changes
The Federal Trade Commission (FTC) continues to refine its regulatory framework to keep pace with evolving consumer markets and digital commerce. In 2025, several significant rule changes take effect, reshaping how businesses must handle pricing, data privacy, and advertising. These updates are not minor tweaks; they represent a clear shift toward greater transparency, stronger consumer protections, and stricter enforcement of fair practices.
For businesses, especially those in e-commerce, ticketing, short-term lodging, and financial services, these changes are not optional. Non-compliance can result in substantial fines, enforcement actions, and long-term damage to brand reputation. The goal of this article is to break down the core 2025 FTC rule changes in plain terms and provide practical, forward-looking guidance for staying compliant.
Key Areas Affected by the 2025 FTC Rules
The 2025 FTC rule changes focus on three major areas:
- Pricing transparency and fee disclosure
- Data privacy and security, especially for children’s information
- Advertising and marketing practices, including AI and environmental claims
Each of these areas introduces new obligations and clarifies existing expectations. Let’s examine them in detail.
1. Pricing Transparency and the Ban on Deceptive Fees
One of the most visible 2025 FTC rules is the new Rule on Unfair or Deceptive Fees, which took effect on May 12, 2025. This rule targets practices that obscure the true cost of a product or service, particularly in live-event ticketing and short-term lodging (such as vacation rentals and short-term rentals on platforms like Airbnb and Vrbo).
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The rule does not ban any specific fee or pricing model. Instead, it requires businesses that advertise a price to disclose the total price upfront, including all mandatory fees, in a way that is clear and conspicuous to consumers.
What the Rule Requires
- Advertised prices must include all mandatory fees (e.g., service fees, facility fees, cleaning fees, resort fees).
- Optional add-ons (e.g., parking, insurance, upgrades) can be shown separately, but must be clearly labeled as optional.
- Businesses must avoid “bait-and-switch” tactics, such as advertising a low price and then adding so many fees that the final price is significantly higher.
- Disclosures must be presented in a way that is easy to see and understand, not hidden in fine print or behind multiple clicks.
Industries Most Impacted
This rule primarily affects:
- Live-event ticket sellers (primary and secondary markets)
- Event venues and promoters
- Short-term lodging platforms and property managers
- Online travel agencies and booking sites
However, the underlying principle—clear, upfront pricing—applies broadly. Any business that advertises a price and then adds significant fees later is at risk of violating FTC standards, even if not in these specific sectors.
Practical Steps for Compliance
- Review all price displays (websites, apps, ads, emails) to ensure the total price is shown early in the shopping process.
- Clearly separate mandatory fees from optional add-ons in the checkout flow.
- Train customer service and sales teams to explain pricing accurately and avoid misleading statements.
- Document your pricing and fee structure for internal audits and potential FTC inquiries.
2. Data Privacy and Security: New COPPA and Third-Party Rules
In early 2025, the FTC finalized updates to its rules under the Children’s Online Privacy Protection Act (COPPA). These changes, which took effect on March 17, 2025, impose stricter requirements on how operators collect, use, and share children’s personal information.
These rules are especially relevant for:
- Children’s apps and games
- Family-oriented websites and online services
- Platforms that may incidentally collect data from children (e.g., social media, educational tools)
Key Requirements for Operators
- Operators must clearly disclose in their privacy notices the identities and specific categories of third parties to whom they disclose children’s personal information, along with the purposes of those disclosures.
- They must also disclose their data retention policies, including how long they keep children’s data and the criteria used to determine retention periods.
- Operators must establish, implement, and maintain a written information security program to protect children’s data.
- They must obtain written assurances from third parties that those parties employ reasonable measures to protect children’s data.
Changes to Parental Consent
The updated rules adopt three new methods for obtaining verifiable parental consent:
- Knowledge-based authentication (e.g., answering security questions based on public records)
- Facial recognition using government-issued photo ID
- Text messages combined with additional steps to verify the parent’s identity
These methods aim to balance strong verification with usability, but they also require careful implementation to avoid inadvertently collecting more data than necessary.
What Businesses Should Do Now
- Audit your online services to determine whether they are directed to children or collect data from children.
- Update your privacy policy and notices to include the required disclosures about third parties and data retention.
- Develop or update your written information security program, including policies for access controls, encryption, and incident response.
- Review contracts with third-party vendors to ensure they provide written assurances of reasonable data protection measures.
- Implement and document your chosen method(s) for obtaining verifiable parental consent.
3. Advertising and Marketing: Avoiding Deceptive Claims
The FTC has long prohibited deceptive and unfair advertising, and in 2025, it continues to emphasize transparency in claims about products, services, and business practices. This includes traditional advertising, influencer marketing, and the use of artificial intelligence in consumer-facing tools.
Common Problem Areas
- Product performance claims: Statements about how well a product works (e.g., weight loss, skin improvement, device performance) must be backed by competent and reliable evidence.
- Pricing and savings claims: “Was/now” pricing, “limited time” offers, and “percentage off” claims must be truthful and not misleading.
- Environmental and sustainability claims (“greenwashing”): Claims about being “eco-friendly,” “carbon neutral,” or “made with recycled materials” must be specific, substantiated, and not overstated.
- Influencer and affiliate marketing: Disclosures must be clear and conspicuous when content is sponsored or when the creator receives compensation.
- AI and automated tools: If AI is used to generate content, recommendations, or decisions that affect consumers, businesses must ensure the tools are accurate, fair, and not misleading.
Best Practices for Compliant Advertising
- Keep detailed records of the evidence supporting all material claims (e.g., test results, studies, market data).
- Use clear, straightforward language; avoid vague or exaggerated terms like “miracle,” “revolutionary,” or “best in the world” without strong support.
- Ensure that disclosures (e.g., “results not typical,” “paid promotion,” “terms apply”) are easy to see and understand, not buried in fine print.
- Regularly review and update marketing materials, especially when launching new products or campaigns.
- Train marketing, sales, and customer service teams on FTC advertising standards.
4. Medical Debt and Consumer Reporting
Another important 2025 FTC rule change involves consumer reporting and medical debt. The FTC has adopted a rule that prohibits consumer reporting agencies from furnishing to creditors a consumer report that contains medical debt information.
This rule, which also took effect on March 17, 2025, is designed to prevent medical debt from unfairly harming consumers’ creditworthiness and access to credit, housing, and employment.
Implications for Businesses
- Creditors and lenders must not rely on consumer reports that include medical debt when making credit decisions.
- Debt collectors and medical providers should be aware that medical debt will no longer appear in standard consumer reports used by most creditors.
- Businesses that use consumer reports for tenant screening, employment, or other purposes must ensure their reports comply with this rule.
Action Steps
- Review your credit reporting and screening processes to ensure they do not rely on medical debt information.
- Update internal policies and training materials to reflect the new rule.
- Communicate with your consumer reporting agencies to confirm they are complying with the FTC’s prohibition.
5. Contract Terms and Consumer Rights
While not an FTC rule per se, the Consumer Financial Protection Bureau (CFPB) has proposed an interpretive rule that would prohibit certain contractual clauses in consumer financial product and service agreements. This proposal is closely aligned with the FTC’s broader mission of protecting consumers from unfair and deceptive practices.
The proposed rule would:
- Prohibit terms that waive substantial consumer legal rights and protections under state or federal law (e.g., rights for servicemembers, protections against elder fraud).
- Bar contract terms that limit free expression, such as threats of account closure or fines for negative reviews.
- Stop companies from unilaterally changing contract terms without proper notice and consent.
- Codify existing prohibitions against taking a consumer’s property without judicial due process.
Although this is a CFPB proposal, it signals a strong regulatory trend that businesses should anticipate. Even if your business is not in financial services, the principle of not using contracts to strip away consumer rights is increasingly important.
What This Means for Your Contracts
- Review your standard terms of service, user agreements, and contracts for any clauses that could be seen as waiving consumer rights or limiting free speech.
- Ensure that any changes to terms are clearly communicated and, where required, require affirmative consent.
- Avoid overly broad or one-sided provisions that could be challenged as unfair or deceptive.
Creating a 2025 Compliance Action Plan
To manage the 2025 FTC rule changes effectively, businesses should adopt a structured, proactive compliance plan. Here is a practical framework:
Step 1: Conduct a Regulatory Gap Analysis
- Map your current practices against the new FTC rules (pricing, data privacy, advertising, etc.).
- Identify areas where your policies, disclosures, or systems fall short.
Step 2: Update Policies and Disclosures
- Revise your privacy policy, terms of service, and any other customer-facing documents to reflect the new requirements.
- Ensure all disclosures are in plain language and easy to find.
Step 3: Improve Internal Systems and Controls
- Implement technical and organizational measures to support compliance (e.g., updated checkout flows, consent management platforms, data retention schedules).
- Strengthen your information security program, especially if you handle children’s data.
Step 4: Train Employees and Partners
- Provide training for marketing, sales, customer service, and legal/compliance teams.
- Ensure third-party vendors and partners understand and comply with relevant rules.
Step 5: Establish Ongoing Monitoring and Audits
- Schedule regular internal audits of pricing, advertising, and data practices.
- Monitor for customer complaints and feedback related to pricing, privacy, and advertising.
- Stay informed about new FTC guidance, enforcement actions, and rule changes.
Common Pitfalls to Avoid
Even well-intentioned businesses can run into trouble. Here are some frequent mistakes to watch out for:
- Hidden fees: Showing a low headline price but adding many mandatory fees later in the process.
- Vague disclosures: Using unclear language or burying important information in fine print.
- Overbroad data collection: Collecting more personal information than necessary, especially from children.
- Unsubstantiated claims: Making strong performance or environmental claims without solid evidence.
- Ignoring third-party risks: Failing to ensure that vendors and partners comply with data and privacy rules.
Frequently Asked Questions (FAQs)
Which businesses are covered by the 2025 FTC fee transparency rule?
The rule specifically targets live-event ticketing and short-term lodging, but the underlying principle of clear, upfront pricing applies to any business that advertises a price and then adds significant fees.
Do the new COPPA rules apply to all websites and apps?
No. The updated COPPA rules apply to operators of websites and online services that are directed to children under 13 or that have actual knowledge that they are collecting personal information from children.
Can I still charge service fees or cleaning fees?
Yes, but you must include all mandatory fees in the advertised total price. Optional add-ons can be shown separately, but must be clearly labeled as optional.
What counts as a “clear and conspicuous” disclosure?
A disclosure is clear and conspicuous if it is easy to notice, read, and understand. It should be in a prominent location, in a readable font size, and not obscured by other content.
How can I prove that my advertising claims are truthful?
Keep detailed records of the evidence supporting your claims, such as test results, studies, market research, and expert opinions. The evidence must be competent and reliable.
What should I do if I receive an FTC inquiry or warning letter?
Take it seriously. Consult with legal counsel experienced in FTC and consumer protection law. Respond promptly and cooperatively, and use the opportunity to review and improve your compliance practices.
Conclusion: Proactive Compliance Is the Best Strategy
The 2025 FTC rule changes are not just about avoiding penalties; they are about building trust with consumers and operating in a fair, transparent marketplace. By understanding the new requirements around pricing, data privacy, and advertising, and by taking concrete steps to comply, businesses can reduce legal risk, enhance their reputation, and create a better experience for their customers.
Compliance is not a one-time project. It is an ongoing process of assessment, improvement, and vigilance. Start now, involve the right stakeholders, and make transparency and fairness core values of your business.
References
- Rule on Unfair or Deceptive Fees — Federal Trade Commission. 2025-05-12. https://www.ftc.gov/news-events/news/press-releases/2025/05/ftc-rule-unfair-or-deceptive-fees-take-effect-may-12-2025
- Children’s Online Privacy Protection Rule: Final Rule — Federal Trade Commission. 2025-01-22. https://www.ftc.gov/legal-library/browse/rules/childrens-online-privacy-protection-rule-final-rule
- CFPB Proposes Rule to Restrict Certain Contractual Clauses — Consumer Financial Protection Bureau. 2025-01-13. https://www.consumerfinance.gov/about-us/newsroom/cfpb-proposes-rule-restrict-certain-contractual-clauses-consumer-financial-product-and-service-agreements/
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