Click-to-Cancel: FTC's Final Rule Will Change The Subscription Landscape Across Industries

In an era where subscriptions are just a click away, getting out of them often frustrates consumers. Responding to that frustration, the Federal Trade Commission (FTC) revised its existing Negative Option Rule, now retitled the "Rule Concerning Recurring Subscriptions and Other Negative Option Programs," on 16 October 2024 (New Rule).¹ Long awaited, the New Rule is designed to put an end to subscription headaches by ensuring a smoother, more transparent subscription cancellation process.² In this alert, we explain the New Rule and offer practical compliance guidance.³

BACKGROUND

The FTC Negative Option Rule was first adopted in 1973 (Prior Rule). To date, its scope has been limited to one specific variety of negative options known as prenotification plans whereby sellers provide notices offering goods to participating consumers, and consumers are then sent such goods unless they decline (e.g., book-of-the-month clubs).⁴ The Prior Rule has long co-existed with a