On October 16, 2024, the Federal Trade Commission (FTC) released a new trade regulation rule entitled "Rule Concerning Recurring Subscriptions and Other Negative Option Programs" (the Rule)...
On October 16, 2024, the Federal Trade Commission (FTC) released a new trade regulation rule entitled
"Rule Concerning Recurring Subscriptions and Other Negative
Option Programs" (the Rule), which will fully replace the
existing "Use of Prenotification Negative Option Plans"
rule. The Rule broadens disclosure, consent, cancellation, and
documentation requirements for programs with any type of
'negative option feature' (such as automatic renewals,
continuity plans, free-to-pay or fee-to-pay conversion offers, or
pre-notification negative option plans).
Among other things, under the Rule, sellers must disclose all
material terms about a negative option plan prior to obtaining a
consumer's billing information. The consumer must provide
express informed consent to the negative option feature and the
required disclosures must be in close proximity to the method of
consent.
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