FTC's 'Click-to-Cancel' Rule Targets Subscription Traps

The Federal Trade Commission (FTC) has introduced the 'click-to-cancel' rule, which mandates that businesses must provide an equally straightforward process for canceling subscriptions as for enrolling. This rule aims to eliminate the difficulties consumers face when attempting to cancel memberships, addressing complaints about deceptive and obstructive cancellation practices. Companies must allow cancellations through the same medium used for signing up, whether online or in person, and must clearly disclose the terms of free trials and auto-renewals. The rule targets various industries, including digital retailers and traditional subscription services, and responds to increasing consumer complaints about subscription traps. Most provisions will take effect 180 days after publication in the Federal Register, and the rule is part of a broader initiative by the Biden administration to simplify consumer-related processes. Critics argue that these regulations could increase costs for consumers due to business compliance demands.