New FTC penalties await businesses with hard-to-cancel subscriptions
Business owners soon will need to give their customers an easy way to cancel their subscriptions or risk big penalties.
The Federal Trade Commission last week finalized its so-called “click-to-cancel” rule, reforming what has been called the “negative option” feature of contracts or any contract provision under which the buyer’s failure to cancel means continued acceptance of the contract — or, for many consumers today, a subscription. For example, not canceling a media or meal-prep subscription means the consumer keeps getting charged for it until they cancel.
Complaints about hard-to-cancel subscriptions have been increasing, the FTC said, rising from 42 complaints per day in 2021 to nearly 70 complaints per day this year.
“Too often, businesses make people jump through endless hoops just to cancel a subscription,” said Commission Chair Lina M. Khan in a statement on the rule change. “The FTC’s rule will end these tricks and traps, saving Americans time and money. Nobody should be stuck paying for a service they no longer want.”
https://www.bizjournals.com/seattle/news/2024/10/23/ftc-subscription-cancel-penalties-click-consumers.html