FTC’s Click-to-Cancel Rule Enforcement Delayed

FTC Delays Enforcement of Click-to-Cancel Rule

The Federal Trade Commission (FTC) has announced a delay in the enforcement of its new click-to-cancel rule. This rule aims to make it as easy for consumers to cancel recurring subscriptions as it is to sign up for them.

What the Click-to-Cancel Rule Entails

The Federal Trade Commission’s (FTC) “click-to-cancel” rule mandates that sellers provide a straightforward method for consumers to cancel their subscriptions, ensuring the cancellation process is as simple as the sign-up process. This regulation aims to eliminate deceptive practices and reduce consumer frustration associated with canceling recurring services.AP News

Key Requirements of the Click-to-Cancel Rule

1. Ease of Cancellation: If consumers can sign up for a service online, they must be able to cancel it through the same medium without unnecessary obstacles. For example, companies cannot require customers to cancel via phone or in person if the sign-up was completed online. Reuters
2. Clear Disclosures: Businesses are required to transparently disclose all terms related to subscriptions, including auto-renewal policies, free trial conversions, and any associated fees. This ensures consumers are fully informed before committing to a service. AP News
3. Obtain Explicit Consent: Before charging consumers for subscriptions, auto-renewals, or trial conversions, companies must obtain clear and affirmative consent. This measure prevents unauthorized charges and enhances consumer control over their subscriptions. ReutersBusiness Insider
4. Prohibition of Misleading Practices: The rule prohibits businesses from employing deceptive tactics that complicate the cancellation process, such as hiding cancellation options or requiring unnecessary steps. This ensures a straightforward and honest approach to subscription management. Lifewire
5. Applicability Across Industries: The regulation applies to a broad range of sectors, including retailers, gyms, online services, and media companies, ensuring widespread consumer protection. Reuters

The FTC has delayed the enforcement of this rule to July 14, 2025, providing businesses with additional time to comply. This postponement aims to balance consumer interests with the practical challenges businesses may face in implementing the new requirements.

For a comprehensive overview of the FTC‘s “click-to-cancel” rule and its implications, you can refer to the detailed coverage by Reuters here: Reuters

• Allowing consumers to cancel in the same manner they used to subscribe.
• Providing a clear and straightforward cancellation process.
• Obtaining consumer consent before charging them for renewals.

Reasons for the Delay

The Federal Trade Commission (FTC) has postponed the enforcement of its “click-to-cancel” rule, officially known as the Negative Option Rule, from May 14 to July 14, 2025. This rule mandates that canceling a subscription should be as straightforward as signing up—particularly if the sign-up can be done online, the cancellation must be possible online as well. Federal Register+9The Verge+9Tech.co+9

The delay is attributed to the complexities involved in implementing such a broad rule across various industries. The FTC recognized that immediate compliance could impose significant burdens on businesses, prompting the decision to provide additional time for companies to adjust their systems and processes accordingly. The Verge

Industry experts are closely monitoring how the FTC manages the implementation of this rule. While the FTC has emphasized that full enforcement will begin on July 14, it has also indicated openness to amending the rule if significant issues arise during implementation. The Verge

For more detailed information on the FTC‘s delay of the “click-to-cancel” rule, you can refer to The Verge’s coverage here: The VergeAlston & Bird+6The Verge+6Latham & Watkins+6

The Federal Trade Commission (FTC) has postponed the enforcement of its “click-to-cancel” rule to July 14, 2025, providing businesses with additional time to align their subscription practices with the new requirements. This rule mandates that canceling a subscription must be as straightforward as signing up, particularly emphasizing that online sign-ups must be accompanied by equally accessible online cancellation options.

Key Steps for Businesses to Prepare

1. Audit and Revise Cancellation Processes: Ensure that the cancellation process mirrors the simplicity of the sign-up procedure. For instance, if customers can subscribe online, they should be able to cancel online without unnecessary hurdles. FOX 9 Minneapolis-St. Paul+2The Verge+2FOX 13 Tampa Bay+2
2. Enhance Transparency in Disclosures: Clearly communicate all terms related to subscriptions, including auto-renewal policies, free trial conversions, and any associated fees. Transparency is crucial to comply with the rule’s emphasis on informed consumer consent. Latham & Watkins+2Investopedia+2Yahoo Finance+2Federal Trade Commission
3. Train Customer Service Teams: Equip your customer service representatives with comprehensive knowledge about the new rule to assist customers effectively and ensure compliance.PC Gamer
4. Review and Update Marketing Practices: Avoid any deceptive practices that could mislead consumers about subscription terms or cancellation procedures. The FTC‘s rule aims to eliminate such tactics. Latham & Watkins+4AP News+4Reuters+4Federal Trade Commission+1AP News+1
5. Monitor Legal Developments: Stay informed about ongoing legal challenges to the rule, as industry groups have filed lawsuits questioning its scope and implementation. Reuters+3JD Supra+3The US Sun+3

By proactively addressing these areas, businesses can ensure compliance with the FTC‘s upcoming enforcement and foster trust with their customer base.

For more detailed information on the FTC‘s “click-to-cancel” rule and its implications, you can read the full article here: FTC delays enforcement of click-to-cancel rule

• Review their current subscription models.
• Assess their cancellation processes.
• Ensure they can meet the FTC‘s standards for easy cancellation.