On Wednesday, the Federal Trade Commission introduced a rule requiring businesses to provide a way for consumers to cancel subscriptions without the hassle.
The rule is called, “Click to Cancel", and makes it mandatory for businesses to get consumer consent for charging memberships and auto-renewals after a free trial.
Under the new rule, businesses must make canceling a subscription just as easy as starting it, while also saving consumers time and money.
It will apply to almost all negative option programs in any media.
"Click to Cancel" includes everything from your gym membership to digital streaming and cable television services.
The rule is meant to address common issues with subscription plans including sellers that misrepresent facts about the product or service, those who make it difficult to cancel, and people being billed even when they didn't agree to pay, such as when a free trial ends.
Moreover, "Click to Cancel" requires sellers to provide important information before obtaining consumers’ billing information and charging them, and requires sellers to get consumers’ informed consent to the negative option features before charging them.
The agency's new rule will take effect 180 days after it is published in the federal register.
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