FTC Announces Final “Click-to-Cancel” Rule: Essential Compliance Updates for Subscription-Based Businesses
Dear Valued Clients, On October 16, 2024, the Federal Trade Commission (FTC) announced the finalization of the "Click-to-Cancel" Rule, an amendment to the Negative Option Rule designed to make it easier for consumers to cancel recurring subscriptions and memberships. Most provisions of the final rule will go into effect 180 days after its publication in the Federal Register. As your trusted legal advisors, Silverstein Legal is committed to keeping you informed about regulatory changes that may impact your operations. This new rule has significant implications for businesses offering subscription services, including those in the adult entertainment industry. Key Provisions of the Final "Click-to-Cancel" Rule 1. Simplified Cancellation Process: Easy Cancellation Mechanism: Businesses must provide a cancellation method that is as easy to use as the method consumers used to sign up. If customers enrolled online, they must be able to cancel online without unnecessary steps or obstacles. No Unnecessary Barriers: Sellers cannot require consumers to interact with a customer service representative or go through lengthy procedures to cancel their subscriptions if they did not do so to sign up. 2. Clear and Conspicuous Disclosures Material Terms Disclosure: Before obtaining a consumer's billing information, you must clearly and conspicuously disclose all…