California Passes Updated Automatic Renewal Law

Key Takeaways:

• On October 4, 2021, California passed an amended automatic renewal law that will require businesses to follow stricter cancellation and notice requirements for subscription-based products and services.
• The updated law goes into effect on July 1, 2022.

On October 4, 2021, California Governor Gavin Newsom signed into law an amendment to California's existing automatic renewal law, which is already one of the nation's strictest laws governing recurring subscription programs. The existing law (last updated in 2018) requires businesses to: (1) clearly and conspicuously disclose certain automatic renewal offer terms; (2) obtain consumers' affirmative consent to the automatic renewal terms; (3) provide an acknowledgment after purchase that includes the automatic renewal terms and cancellation policy in a manner that can be retained by the consumer; (4) provide consumers with a readily-accessible mechanism for canceling an automatic renewal contract;