US adopts ‘click to cancel’ rule for easier subscription management
The new FTC rule bans businesses from forcing customers to navigate chatbots or agents to cancel subscriptions signed up to online.
The United States Federal Trade Commission (FTC) has introduced a new ‘click to cancel‘ rule, designed to simplify the process of ending subscriptions. The rule mandates that businesses must make it just as easy for consumers to cancel a subscription as it is to sign up for one, and requires customer consent before renewing subscriptions or converting free trials into paid services.
Under the new regulations, businesses will no longer be allowed to force customers to navigate chatbots or agents to cancel subscriptions initiated via an app or website. The rule will take effect in about six months and aims to save consumers time and money by eliminating unnecessary hurdles. For subscriptions made in person, companies must provide an option to cancel by phone or online.
The FTC has previously sued Amazon and Adobe for making it difficult for consumers to cancel subscriptions. Amazon was accused of using misleading website designs to push people into automatic Prime renewals, while Adobe allegedly imposed hidden fees and unclear cancellation terms. Both companies have rejected the claims.
Similar measures have also been adopted in the United Kingdom. The Digital Markets, Competition and Consumers Act 2024 ensures that businesses must give clear information to customers before they enter into subscription agreements, and make it easier for them to cancel or end contracts.
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