The U.S. Federal Trade Commission (FTC) adopted a new rule on Wednesday requiring businesses to make canceling subscriptions and memberships as easy as signing up, marking the agency’s last major rulemaking before the upcoming Nov. 5 election.
Known as the "click to cancel" rule, it mandates that retailers, gyms, and other companies obtain clear consent from consumers for subscriptions, auto-renewals, and free trials that convert to paid memberships. The cancellation process must be "at least as easy to use" as the sign-up process.
FTC Chair Lina Khan explained that the rule addresses growing consumer frustrations over how simple it is to subscribe but how challenging it can be to cancel. “Companies shouldn’t be able to trick you into paying for subscriptions you don’t want,” Khan said in an interview.
The rule also prevents businesses from forcing consumers who signed up online or through an app to cancel through a chatbot or customer service agent. For in-person signups, companies must offer a way to cancel either by phone or online
