FTC proposes "click-to-cancel" rule to simplify subscription cancellations.
The Federal Trade Commission (FTC) is proposing a new "click to cancel" rule to help consumers cancel hard-to-stop free trials, auto-renewals, and subscriptions. Negative-option marketing, where consumers agree to automatic billing after trying something out for free or following a special discount offer, is a big problem. The proposed rule would require businesses to simplify cancellations and provide an annual reminder to consumers enrolled in negative-option programs. Companies would also have to ask whether consumers would like to consider offers or modifications to their subscription plan, but once declined, they must cancel the negative-option arrangement immediately.