New Virginia Law Mandates Disclosure of Mandatory Fees in Consumer Transactions, Subject to Certain Exemptions

On May 2, Virginia Governor Glenn Youngkin signed Senate Bill 1212 (SB 1212) into law, introducing new requirements and prohibitions under the Virginia Consumer Protection Act. Specifically, SB 1212 targets the disclosure of mandatory fees and surcharges in consumer transactions.

Key Provisions

• Mandatory Fee Disclosure:
  • Suppliers must clearly and conspicuously display the total price of goods or services, including all mandatory fees or surcharges, in any advertisement or display.
    • “Mandatory fees or surcharges” is defined to include any additional fee or surcharge that must be paid in order to purchase the good or service being advertised, but does not include (i) taxes or fees imposed on the consumer by a government or government-approved entity or (ii) reasonable postage or shipping fees.
  • This requirement aims to eliminate hidden fees that are typically disclosed only at the point of sale.
• Exemptions:
  • Certain industries are exempt from these disclosure requirements, including:
    • Motor vehicle dealers
    • Electric utilities, natural gas utilities, and telecommunications service providers
    • Real estate settlement services (excluding real estate broker commissions and fees)
    • Air transportation by air carriers
    • Health club services
• Compliance for Price-Variable Suppliers:
  • Suppliers whose total price is determined by consumer selections or preferences must disclose:
    • Factors determining the final price
    • Any mandatory fees or surcharges associated with the transaction
    • That the total cost of services may vary
• Limitations and Exclusions:
  • The legislation allows for promotions or discounts, including offers to waive mandatory fees, without violating its provisions.
  • Suppliers are not required to comply if federal law expressly preempts the application of this chapter.

Any violation of this chapter constitutes a prohibited practice under the Virginia Consumer Protection Act and is subject to enforcement provisions therein.

Our Take

For financial services companies operating in Virginia, the bill requires an “all-in” price for consumer goods and services or, alternatively, additional disclosures explaining any mandatory fees where consumer selection drives the final price. More broadly speaking, the enactment of Virginia’s SB 1212 may be seen as a response to evolving regulatory landscapes at the federal level, particularly in light of the Federal Trade Commission’s (FTC) final Junk Fee Rule released in December 2024. As discussed here, the FTC streamlined its rule to only focus on live-event tickets and short-term lodging. Virginia’s SB 1212, on the other hand, casts a wider net across various consumer transactions, showing more states working to fill the gap left by federal regulators.

We will continue to monitor state activity aimed at filling a perceived gap in federal regulator and provide updates.