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Ticketing regulation back on the agenda in Congress after FTC debate

By | Published on Friday 14 June 2019

US Congress

Hot on the heels of Tuesday’s FTC-organised debate on the American ticketing market, a member of the US House Of Representatives is having another go at introducing a bunch of new rules to regulate the sale of tickets Stateside. And while some of that regulation would impact on ticket touts (aka scalpers) and the resale sites they use, the proposed act would be as much about regulating the primary market as the secondary.

The Federal Trade Commission’s big ticketing debate earlier this week put the spotlight on various common gripes, including the use of bots by touts to harvest tickets from primary sites, the steep fees charged by both primary and secondary ticketing services, and the lack of transparency in the wider ticketing market, especially about fees and how tickets are allocated to different parties by promoters.

Congressman Bill Pascrell is a long-time critic of the US ticketing sector and especially its biggest player, Live Nation’s Ticketmaster. He has proposed fiercer regulation of the market previously, usually – like this time – under the guise of the BOSS Act, so named because the original version came in the wake of the scandal that erupted over the sale of tickets to some Bruce Springsteen shows in 2009. On that occasion Ticketmaster was accused of directing consumers to touted tickets on its own resale site Tickets Now even though its primary site hadn’t yet sold out.

In order to get to the BOSS Act name Pascrell’s legislation has the full title of Better Oversight Of Secondary Sales And Accountability In Concert Ticketing. Which should really be the BOSSACT Act. And it doesn’t really work anyway because, actually, a lot of the proposed new rules relate to better oversight of primary rather than secondary ticket sales. But still, all the best Congressional legislation has a laboured name in order to create a snappy acronym.

In terms of what the act proposes, some of it would apply to both primary and secondary ticketing websites, in particular the new rule to force up-front declarations of all and any booking fees across the board. At Tuesday’s FTC session, reps from both primary and secondary ticketing firms implied they’d actually welcome such a rule.

It seems most people now agree that consumers should be told the full price of buying a ticket up front – so no booking fees are added at the final stage of the purchase process – but no one wants to be the first ticketing platform to do that, because it would make it look like their tickets were more expensive to people casually browsing around for options.

On the primary side, the BOSS Act also seeks full transparency on how a promoter is allocating tickets. Or, more specifically, it would demand that all primary ticket sellers “disclose the total number of tickets for sale to the general public within seven days of tickets becoming available for sale”.

This has always been a bigger talking point in the US where many more tickets to in-demand shows might be allocated to commercial and brand partners so that – once music industry and fan club allocations are also taken into account – a minority of tickets actually go on general sale. Tickets are sometimes allocated in this way for shows outside the US too, but generally not on the same scale.

Supporters of the secondary ticketing market are often critical of this practice – and the fact that promoters and primary sellers don’t reveal how many tickets are actually going on general sale – arguing that it is these holdbacks and commercial partner allocations that really make it difficult for fans to access tickets. Though arguably the secondary market benefits from these practices, because savvy touts also sign up to brand partner and fan club pre-sales to access tickets to then sell on at a hiked-up price.

When it comes to ticket resale, Pascrell’s act would actually protect the right of customers to sell their tickets on, and ban promoters from seeking to restrict touting or cancel touted tickets. However, it would also force some transparency onto the secondary market – similar to measures already introduced in the UK – so that resellers and the sites they use would have to declare the original face value of any tickets being resold, the seats or zones that tickets relate too, and the fact the seller is a reseller not a primary ticket agent.

There would also be a new rule about speculative selling, where a tout advertises for sale a ticket they don’t currently possess. “Secondary market companies must verify that the secondary ticket reseller is in possession of a ticket”, the proposed act says, “or has made clear the secondary ticket reseller does not possess the ticket with an explanation on how to obtain a refund if the purchaser receives a ticket that does not match the description”.

It remains to be seen if Pascrell’s bill progresses further this time round, though Tuesday’s big FTC debate suggests that there would be support for at least some of the Congressman’s proposals within the ticketing sector. And, actually, more opposition may come from the primary ticket agents than the touts and websites they use to resell.

Commenting on the latest incarnation of his BOSS Act, Pascrell said yesterday: “Even though it’s 2019, the $9 billion live events ticket market resembles the Wild West: bereft of regulation and order, with bad actors around too many corners making a living by ripping people off. The BOSS Act would finally impose hard regulation and transparency to the ticket market so that fans can find affordable tickets and enjoy some live entertainment in these uneasy times without fear of being taken to the cleaners”.

“Americans have been gouged and gouged and then gouged some more”, he went on. “Ticket buyers don’t know how many tickets are going on sale or how many are being held back, can’t see what fees will be tacked on, and sometimes don’t even know if the tickets they are purchasing exist yet. For too long on these issues, our government has failed to hear the ghost of Tom Joad, the common man and woman. It’s high time government stands up for him and for them. My legislation is for the fans, not Ticketmaster”.

Also supporting the proposed legislation in Congress are Frank Pallone Jr and Albio Sires in the House Of Representatives, and Richard Blumenthal in Senate. Organisations speaking in favour of the proposals include the National Consumers League, Consumer Federation Of America and Consumer Reports, as well as the National Association Of Ticket Brokers.