Following our prior alert, the National Automobile Dealers Association (NADA) met with the Federal Trade Commission (FTC) on March 24 to clarify the agency’s expectations for advertised vehicle pricing.
The FTC provided a definitive statement regarding the treatment of document fees (“doc fees”) in advertising: dealers must include the doc fee in the advertised price of vehicles.
FTC Requirements for Advertised Prices
The FTC clarified that only fees collected by the dealer and remitted directly to the government—such as taxes, title, and registration—may be excluded from the advertised price. All other mandatory fees that the dealer retains, including doc fees, must be included in the advertised price.
The FTC requires dealers to:
- Include all dealer-imposed charges, including doc fees, in the advertised price
- Exclude only government-imposed charges (taxes, title, and registration)
- Ensure that any additional pricing information:
- Appears less prominently than the all-in price
- Is truthful and clearly qualified
- Does not mislead or confuse a reasonable consumer
The FTC does not regulate the amount of doc fees. It regulates how dealers disclose those fees in advertising.
Enforcement
Dealers should not rely on state law to shield them from FTC enforcement. The FTC expects all dealers to include doc fees in the advertised price, regardless of state law.
The FTC may seek civil penalties of up to $50,120 per violation of the FTC Rule, or per day for ongoing violations, which significantly increases the financial risk associated with non-compliant advertising practices.
Effect on Purchase Agreements
The FTC’s position applies to advertising. It does not alter Minnesota’s requirements for motor vehicle purchase agreements.
Minn. R. 7400.5200, subp. 2(E) requires a dealer to include “an itemized list of all fees and taxes collected in connection with the transaction.”
Dealers must continue to comply with this requirement. Accordingly, a dealer must separately itemize the doc fee on the purchase agreement.
Next Steps
The FTC has indicated that it will issue additional guidance in a forthcoming FAQ. MADA will monitor any FTC enforcement activity in Minnesota.
