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I cannot stand when I go to end a subscription, and rather than a “cancel” button, they present me a phone number. I never had to call to subscribe. In fact, most companies make it way too easy to enroll in their services. So how is it right to make the process of ending those services so much more difficult? It doesn’t seem right—and the FTC agrees.
The Federal Trade Commission is now cracking down on this shady activity, and is about ready to roll out its “Click to Cancel” rule. The FTC announced this news in a press release on Wednesday, outlining the main objective of “Click to Cancel.” First and foremost, the goal is to make it as easy to cancel a service as it is to sign up for it. It’s a bit overdue, but a welcome change nonetheless.
But it goes beyond this change, as it pertains to services with a “negative option” feature (a business practice where a company can decide to bill you when you haven’t told them not to). The new rule also ensures that companies cannot misrepresent facts while trying to sell you on their services; must disclose its terms before you hand over your billing information (you have to know what you’re actually signing up for); have to obtain your “informed consent” to this negative-option feature before charging you; are bound to provide a simple cancel option for these features, and stop charging you right away. That all sounds great to me.
The FTC decided against other requirements it had considered for these rules, such as forcing companies to send annual reminders of their negative-option subscription features, as well as blocking companies from telling you about alerted plans when you try to cancel. While it’s a bit of a scummy business practice, it does mean threatening to cancel your subscriptions is often a great way to lower your costs.
It’s all an update to its Negative Option Rule, first put into practice in 1973. Most of the changes will go into effect 180 days after the rule is published in the Federal Register, but the FTC doesn’t say which changes those will be.
In the meantime, companies can still make it tricky for you to cancel, but these business practices are not long for this world (at least in the U.S.). If you’re feeling petty, you can report these companies for employing these tactics if you come across it, and there are workarounds to trick some companies into letting you cancel online. Let’s just hope that most companies get ahead of the changes and immediately start letting you easily end subscriptions.