The Federal Trade Commission issued a final “click-to-cancel” rule to make it as easy for consumers to cancel recurring payments for products and services as it was for them to sign up. The amendment to the 1973 Negative Option Rule includes civil penalties designed to combat business practices that make it structurally difficult or unclear for consumers to end their participation in automatic renewal programs. 

The commission said it receives an average of 70 complaints per day, up from 42 daily in 2021. The agency said it collected 16,000 comments, from consumers, trade associations and state and federal agencies, since proposing the rule in March 2023.  

The FTC rule affects a broad range of businesses, from monthly wine clubs to magazine subscriptions and internet and cable television providers. Sometimes subscription charges end up recurring on consumers’ credit and/or debit cards. 

The FTC rule also will prohibit sellers from misrepresenting any material facts while using negative option marketing and imposes civil penalties for consumer recovery. It also will require sellers to obtain consumers’ informed consent to the negative option features of a program before it can charge them. 

The FTC rule follows a similar California law, enacted in September. The effort comes as part of the Biden administration’s wider campaign against “junk fees,” which the president has said would save Americans more than $20 billion annually.  

The final rule has several changes from the proposal 18 months ago. It no longer requires sellers to give customers annual reminders of the negative option aspect of their subscription. The rule also no longer bars sellers from telling consumers wanting to cancel their subscription about plan modifications or reasons to keep their existing agreement without first asking if they want to hear these.