What must auctioneers disclose to bidders regarding the buyer's premium?

The correct answer emphasizes the importance of transparency and fairness in the auction process. Auctioneers are required to clearly disclose the buyer's premium before bidding begins to ensure that all bidders are aware of any additional costs they will incur if they win the auction. This upfront communication helps bidders to make informed decisions about their participation and potential costs, fostering trust between the auctioneer and the bidders.

Clear disclosure also protects the auctioneer from potential disputes and complaints that could arise if bidders find out about the buyer's premium only after the auction has concluded. By establishing this information at the outset, it contributes to a fair auction environment where bidders can assess their total financial commitment prior to engaging in the bidding. This is why the timing of the disclosure is critical, and it must be addressed before the bidding process starts.