In a significant win for consumer rights, the U.S. Federal Trade Commission (FTC) has introduced a new regulation aimed at making it easier for Americans to cancel recurring subscriptions. Following the U.S. Federal Communications Commission’s (FCC) restoration of net neutrality earlier this year, the FTC’s move marks another step toward enhancing consumer protections—something the European Union has consistently championed in recent years.
The new FTC regulation, officially known as the “Rule Concerning Recurring Subscriptions and Other Negative Option Programs,” updates what was previously called the Negative Option Rule. While the government jargon might sound complicated, the goal is simple: it’s going to be much easier for consumers to unsubscribe from services they no longer want.
The term “negative option” refers to a practice where companies automatically renew subscriptions or start charging after a free trial ends—often without clear consent from the consumer. This has long been a source of frustration, as many customers find themselves stuck with unexpected charges for services they didn’t intend to continue.
“Problematic negative option practices have remained a persistent source of consumer harm for decades, saddling shoppers with recurring payments for products and services they never intended to purchase or did not want to continue buying,” the FTC said when it first proposed the new rule.
For modern consumers, this issue is all too familiar. Whether it’s for streaming platforms like Netflix and Spotify or gaming services like Game Pass, navigating through convoluted unsubscribe processes can be a headache. One common example involves the cinema subscription service Regal Cinemas. When trying to cancel a year-long subscription, one customer discovered they had to email a support team—without a cancel button on the app or website—and found themselves charged an additional month when the service auto-renewed before they could cancel.
These sorts of predatory practices will now be subject to the FTC’s new rule, which mandates that companies provide “a simple way for people to cancel.” This means that the process of ending a subscription must be as easy as signing up for one. Additionally, companies must not force customers to speak with a representative to cancel or charge them extra fees for canceling by phone.
The new rule also aims to ensure that important information is clear and upfront. Before subscribing, consumers should be made aware of the trial period’s duration, any hidden fees, and cancellation terms. The FTC emphasizes that all this information must be “clear, conspicuous, and available” at the time of sign-up.
Some parts of the rule will go into effect in the next 60 days, while others will roll out over the next 180 days. Once fully implemented, these revisions should make it much easier for consumers to cancel services they no longer want, especially those that have relied on confusing or cumbersome processes to keep customers paying.
For anyone who’s ever struggled to escape an unwanted subscription, this new regulation could bring long-awaited relief, signaling a shift towards more transparent and consumer-friendly business practices.
