FTC Finally Makes It Easier to Cancel Your Subscription
I hate it when I’m about to cancel my subscription and instead of the “cancel” button I’m presented with a phone number. I’ve never had to call to subscribe . In fact, most companies make it too easy to sign up for their services. So what is the right way to make it more difficult to terminate these services? This doesn’t seem right, and the Federal Trade Commission agrees.
The Federal Trade Commission is currently cracking down on this questionable activity and is almost ready to enforce the “Click to Cancel” rule. The Federal Trade Commission announced the news in a press release on Wednesday , outlining the primary purpose of “Click to Cancel.” First of all, the goal is to cancel a service as easily as it is to subscribe to it. This is a bit of a late change, but a welcome change nonetheless.
But it goes beyond the scope of this change because it applies to services with a “negative option” feature ( a business practice in which a company may decide to bill you without you telling it not to). The new rule also ensures that companies cannot misrepresent facts when trying to sell you their services; must disclose its terms and conditions before handing over your payment information (you should know what you’re actually signing up for); must obtain your “informed consent” for this negative option feature before charging you; will make sure to provide an easy option to cancel these features and stop charging you immediately. This all sounds great to me.
The FTC abandoned other requirements it considered for these rules, such as forcing companies to send annual reminders about their opt-in subscription features, and prohibiting companies from telling you about plans with a notification if you try to cancel them. While this is a bit of a sneaky business practice, it does mean that threatening to cancel your subscription is often a great way to keep your costs down.
All of this is an update of the negative options rule , first introduced in 1973. Most of the changes will take effect 180 days after the rule is published in the Federal Register, but the Federal Trade Commission is not saying what those changes will be.
Meanwhile, companies can still make it difficult for you to cancel, but this business practice is short-lived for this world (at least in the US). If you’re feeling petty, you can report these companies for using such tactics if you encounter them, and there are workarounds to trick some companies into canceling your order online . Hopefully, most companies will get ahead of the change and start allowing you to easily cancel your subscriptions right away.