Washington, D.C. Just Banned Hidden Fees — Violators Could Now Pay Triple Damages

If your business advertises a price to customers in Washington, D.C. and then adds fees at checkout, a law heading toward the mayor's desk could soon make that a very expensive habit. The D.C. Council voted 13-0 to pass the Enhancing Consumer Protection Procedures Amendment Act of 2026, a sweeping bill that bans "drip pricing" and hidden fees — and unlike some junk-fee laws, this one comes with real teeth: triple damages for customers who sue, and liability that can reach beyond the business itself to the vendors and consultants who helped set the pricing up.

What "Drip Pricing" Means Under the New Law

Drip pricing is the practice of advertising an artificially low price and then adding mandatory fees, surcharges, or charges once the customer is checking out — a resort fee added at hotel checkout, a "service fee" tacked onto a ticket, a delivery charge that only appears at the final screen. The D.C. bill, known as B26-0174, targets exactly this pattern. Under the act, mandatory charges have to be baked into the advertised price up front, not revealed at the last step of a transaction.

This isn't a small, symbolic gesture. D.C. is moving in the same direction as Illinois and New York City, which have rolled out their own junk-fee crackdowns this summer — meaning any business operating in more than one of these jurisdictions now has to get pricing disclosure right in multiple places at once, with different rules in each.

Where the Real Risk Is: Enforcement

Most hidden-fee laws only expose a business to a state attorney general's office. D.C.'s bill goes further in two ways that small business owners should pay close attention to.

1. Mandatory Minimum Penalties

The act's attorney general enforcement provisions — including mandatory minimum civil penalties and the ability to recover costs and fees — take effect immediately upon enactment. That means once the mayor signs it and it clears congressional review, the D.C. Attorney General doesn't have discretion to let a violation slide with a warning; penalties are baked in as a floor, not a ceiling regulators choose from.

2. A Private Right of Action — With Treble Damages

Separately, the bill creates a private right of action, meaning individual customers — not just the Attorney General — can sue a business directly over hidden fees. If they win, the law allows for treble damages: three times the amount they were overcharged. For a business with high transaction volume, even a single class-style complaint over a systemic pricing pattern could add up fast.

3. Liability Doesn't Stop at Your Business

The bill also creates aiding-and-abetting liability for vendors, payment processors, and consultants who help facilitate deceptive pricing practices. If a point-of-sale platform, a pricing consultant, or a payment processor helped structure a fee model that violates the law, they can be pulled into liability too — which means businesses should expect vendors to start asking harder questions about how fees are displayed.

Where Things Stand Right Now

The Council passed B26-0174 unanimously, and it's fully funded through the Council's FY2027 budget. From here, it needs the mayor's signature and then faces a standard 60-day congressional review period before most provisions take full effect — though the attorney general enforcement provisions kick in upon enactment, ahead of the private right of action provisions. Businesses shouldn't wait for every provision to formally activate before cleaning up their pricing pages; enforcement authority arrives early in the sequence, not late.

You Don't Have to Be Based in D.C. Either

Like most consumer protection laws, this one is triggered by where the customer is, not where the business is incorporated or headquartered. An online retailer, ticketing platform, or subscription service based anywhere in the country that sells to D.C. residents can be reached by the act if its pricing practices reach D.C. consumers. Businesses that sell nationally through a single website often assume local consumer-protection laws only apply to brick-and-mortar operations in that jurisdiction — that assumption is exactly what gets national online sellers into trouble when a new law like this takes effect.

How This Compares to the Federal Rule

Small business owners may already be aware of the FTC's federal junk-fees rule, which took effect in 2025. That federal rule is much narrower than D.C.'s new law — it only applies to two categories of transactions: live-event tickets and short-term lodging. D.C.'s act has no such carve-out. It applies broadly across industries, to any advertised price with mandatory fees added later, which means a business that already checked the "we're FTC compliant" box cannot assume it's covered under D.C. law. The two rules aren't redundant; they're stacked, and D.C.'s reaches much further.

Part of a Broader Summer 2026 Crackdown

D.C. is one of three major jurisdictions cracking down on junk fees this summer, alongside Illinois and New York City, which have each advanced their own hidden-fee restrictions around the same time. For a business operating across state lines — say, a regional restaurant group, a multi-city service business, or an e-commerce brand shipping nationwide — this means pricing compliance is no longer a single checklist. Each jurisdiction's rules differ slightly in scope, enforcement mechanism, and effective date, and treating them as one uniform standard is a common and costly mistake.

Who Needs to Pay Attention

This isn't just a hospitality and ticketing issue. Any D.C. business that:

• Advertises a price online or in-store and adds mandatory fees at checkout
• Charges "service fees," "processing fees," or "convenience fees" that aren't disclosed upfront
• Uses a third-party booking, point-of-sale, or payment platform that adds fees on its behalf
• Operates a subscription or membership model with fees that aren't clear at signup

...should assume this law applies once it takes effect, regardless of industry.

How to Get Ahead of It

1. Audit Your Checkout Flow

Walk through your own purchase flow — website, in-store point of sale, and any third-party booking tool — and note every fee that appears after the customer has already committed to a price. Anything that shows up later than the initial advertised price is a candidate for restructuring.

2. Fold Mandatory Fees Into the Sticker Price

The safest move under a drip-pricing ban is to build genuinely mandatory fees into the advertised total price, and reserve separate line items for costs that are optional or that vary by customer choice (like expedited shipping).

3. Talk to Your Vendors

If a point-of-sale system, booking platform, or payment processor is adding fees on your behalf, ask directly how those fees are disclosed to the customer. Given the bill's aiding-and-abetting liability, "the platform did it" won't necessarily shield your business.

4. Revisit Your Pricing Documentation

Owners who haven't looked at their pricing structure in a while may find this is a good moment to also clean up broader financial documentation — a current profit and loss statement makes it much easier to see exactly how fee income factors into your actual margins before you restructure pricing. If you're setting up a new location or business line in D.C., make sure your business license paperwork is current, since local regulators tend to scrutinize newly licensed businesses more closely after a law like this takes effect.

The Takeaway

D.C.'s hidden-fee crackdown is part of a fast-moving national trend, but the private right of action and treble damages provision make it more dangerous to small businesses than most junk-fee laws passed so far this year. Businesses that clean up their pricing disclosures now, before the law is fully in force, avoid becoming the test case that proves how serious the penalties really are.

Photo by Towfiqu barbhuiya on Unsplash