The Federal Trade Commission has announced the final "click-to-cancel" rule, which is designed to ensure that consumers can cancel subscriptions as easily as they signed up for them. This rule covers most negative option programs across various platforms.

The FTC's fact sheet on the new rule indicates that the perceived concerns the FTC seeks to address with the rule include merchants who do not tell the truth during sign-up (or omit material information), consumer frustration over billings they don't believe they agreed to pay, and merchant's who make it hard ("or impossible") to cancel. Businesses will have about six months to review the rule and ensure compliance before it goes into effect.  

Recently, California updated its automatic renewal law, which will align with the FTC's rule in some ways, such as by requiring that the merchant obtain the consumer's express affirmative consent, prohibiting misleading practices in connection with the subscription, and providing easy cancellation methods (including in the same medium that the consumer used to sign up for the subscription).  California's amendment will go into effect on July 1, 2025, likely just after the FTC's final rule is effective.  

Businesses offering subscriptions should assess their processes to confirm they comply with existing and upcoming state and federal laws. Those same businesses should consider adopting a regular schedule to review those processes and amended laws, because this remains an area of regular change.