FTC announces "click-to-cancel" rule making it easier to cancel subscriptions (ftc.gov)

Article summary

The Federal Trade Commission (FTC) has announced a final 'click-to-cancel' rule, making it easier for consumers to cancel recurring subscriptions and memberships. The rule requires sellers to make cancellation as easy as signing up and prohibits them from misrepresenting material facts or failing to disclose important information. The rule will apply to most negative option programs and will go into effect 180 days after publication in the Federal Register. The FTC received over 16,000 comments on the proposed rule, which aims to combat unfair or deceptive practices related to subscriptions and recurring payments.

Main themes

• Consumer Protection
• Subscription Services
• FTC Regulation
• Business Practices
• Cancellation Policies

What commenters say

• The 'click-to-cancel' rule is a positive step towards protecting consumers from unfair business practices, particularly in the gym industry where cancellation policies are often restrictive.
• Some businesses, such as gyms, make it intentionally difficult for consumers to cancel their memberships as a way to generate revenue, and this rule will help to prevent such practices.
• The rule may not be effective in preventing all unfair business practices, and some commenters argue that it goes too far in regulating businesses, potentially harming legitimate companies.
• Consumers should be aware of the terms and conditions of their subscriptions and memberships, and not rely solely on the 'click-to-cancel' rule to protect them from unfair practices.
• The rule is seen as a pro-consumer measure, but some argue that it is anti-business, and that it may have unintended consequences, such as increasing costs for businesses and ultimately consumers.
• The gym industry is a particular area of concern, with many commenters sharing experiences of being trapped in contracts with difficult cancellation policies, and welcoming the rule as a way to increase transparency and fairness.