NYC junk fee rule targets hidden apartment, hotel fees
The proposed subscription rule, effective Oct. 1 after a public comment and hearing period, would penalize companies that do not provide a straightforward way to cancel recurring charges for gym memberships, streaming services and other auto-renewing subscriptions. Violators would face fines of $525 per user subscription plus back fees and additional penalties, the Department of Consumer and Worker Protection (DCWP) said.
“People shouldn’t have to wait on hold for half an hour or send a certified letter or show up to a store in person in order to cancel” a subscription, said Samuel AA Levine, the city’s commissioner of consumer and worker protection, in an interview.
The new subscription rule operates alongside a parallel proposed rule targeting “junk fees” — mandatory surcharges that raise the final price of goods and services. That rule would require sellers to “advertise the total price for any good or service, including all mandatory additional charges and fees, up front,” according to a release from the mayor’s office.
The junk fee measure could have wide impact on New York’s housing market, where about 70% of residents rent. Apartment renters increasingly face add-on charges such as “boiler management” and “lifestyle” fees from management companies that make true rental costs hundreds of dollars higher than the price advertised online. Under the proposed rule, any mandatory fees, including annual ones, would need to be included in the stated monthly rental price, Levine said.
The current situation creates “a scenario where rather than competing on price, companies are competing on their ability to hide the true price,” Levine said. The commissioner described that dynamic as “the worst kind of incentive — one that deeply distorts the market.”
The measures are part of an aggressive push by Mayor Mamdani and Levine, a former head of consumer protection at the Federal Trade Commission (FTC), to rein in what they see as predatory corporate practices. “In the dawn of the Reagan era, the FTC and others in Washington said expressly that … markets could correct themselves, regulate themselves, they were going to stop writing rules,” and allow companies to police their own behavior, Levine said. “What it has gotten us is 40 years of deceptive pricing.”
Industry groups have fought similar proposals aggressively. When the Biden administration introduced a national junk fee rule in 2024, the U.S. Chamber of Commerce argued it was “an attempt to micromanage businesses’ pricing structures,” and apartment fees were cut from that federal rule after lobbying by the real-estate industry. A national “click to cancel” rule introduced by the Biden administration was struck down by a federal judge in 2025 over a procedural issue, days before it was set to take effect. The Trump administration’s FTC plans to pass a similar rule in coming months, according to the source.
Companies generate billions annually in automatic subscription renewals that consumers do not want or do not know they have, the source said. The Roosevelt Institute think tank estimates the subscription rule could save New Yorkers $162.5 million per year.
The Mamdani administration has also directed the DCWP to coordinate with the city’s Law Department and the New York State Attorney General to combat subscription tricks and traps, following Mayor Mamdani’s Executive Order 10, “Fighting Subscription Tricks and Traps,” issued in January.
The New York City Council has separately proposed a rule banning “surveillance pricing,” in which companies charge consumers different prices for the same good or service based on algorithmic analysis of their spending and personal habits. Maryland banned the practice in April; Colorado’s governor vetoed a ban last month.
The DCWP will accept public comments on the junk fee rule and then hold a hearing, Levine said. “I certainly hope that we can get this rule done by the end of the year.”