FTC Issues Subscription Services Notice Of Proposed Rulemaking

Businesses and customers alike benefit from the advantages of automatic renewal subscription services. Among other things, companies can effectively maintain a consistent customer base, predict future earnings, and make associated decisions based on this data. Consumers, likewise, may easily sign up for subscription services and depend on the continuity of the plan, without having to think about, or go to the trouble of,periodically renewing. However, the Federal Trade Commission ("FTC") is concerned about certain bad actors who may use unfair or deceptive practices to sign up consumers and prevent them from easily cancelling subscriptions, memberships, and other recurring-payment programs. To address this concern, the FTC is now proposing, among other things, a "click to cancel" provision that would require sellers "to make it as easy for consumers to cancel their enrollment as it was to sign up."