Can IHG increase the transaction fee of $0.06 per transaction for Crowne Plaza hotels?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
Hotel acknowledges that IHG and FreedomPay have entered into the Secure Payment Solution Agreement (the "SPS Agreement"), effective as of July ___, 2021. The SPS Agreement provides that an IHG-branded hotel or service company to such a hotel may, upon execution of a Participation Agreement, receive the benefit of the Secure Payment Solution services agreed by IHG and FreedomPay.
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- FreedomPay Services. FreedomPay will provide services in accordance with the terms of this Participation Agreement, including the FreedomPay Pass-Through Terms set forth on Attachment 1, which Hotel expressly agrees to and accepts. With respect to security, availability, and confidentiality, FreedomPay provides t
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, IHG cannot increase the transaction fee of $0.06 per transaction. The document states that IHG charges hotels a fee of $0.06 per transaction, which includes online authorization requests, captured requests without online authorization, return requests, and void requests. This fee is typically collected by the merchant service provider during settlement reconciliation.
However, IHG retains the right to lower this transaction fee, providing notice to the hotel. This indicates that while the fee can be reduced at IHG's discretion, it cannot be increased. This policy provides some financial predictability for Crowne Plaza franchisees regarding this specific transaction fee.
In addition to the transaction fee, Crowne Plaza hotels also pay IHG a monthly support fee of $140. IHG has the ability to modify this support fee, but it cannot increase by more than 10% annually, again providing some predictability for franchisees. These fees are part of the broader financial obligations a franchisee must consider when evaluating the investment.