The 'Click to Cancel' rule for subscriptions faces a new challenge

PHOENIX (AZFamily) — How many subscriptions do you pay for that you forgot? Maybe you’ve tried to cancel a subscription, but there are too many hoops to jump through. A new rule should make it easier to cancel subscriptions, but now he faces a new legal challenge.

The goal of the Federal Trade Commission’s new click-to-cancel feature is to make canceling a subscription as easy as signing up, something that has been a challenge for many consumers. The FTC says it receives about 70 complaints a day about problems with subscription cancellations.

“Companies are increasingly doing this for a simple reason: it is more profitable to charge you twice than to charge you once. It’s even more profitable to charge you 12 times or every month for the rest of your life,” says Lindsay Owens, director of Groundwork Collective.

Several trade groups are now asking the court to reject the rule. The Electronic Security Association, the Interactive Advertising Bureau and the Internet and Television Association call it “arbitrary” and an “abuse of discretion.” The groups have not commented on On Your Side.

“When companies have a business model that depends on forcing customers to keep paying against their will, it threatens Americans’ economic freedom. The FTC’s rule is common sense and we are prepared to defend it in court,” said Douglas Farrar, a spokesperson for the FTC.

In Arizona, On Your Side reported on the challenges people faced canceling their gym memberships during the pandemic. In 2021, then-Gov. Doug Ducy signed a law that allowed Arizona residents to remotely cancel their gym memberships.

The ‘click to cancel’ rule will come into effect 180 days after the initial publication earlier this month.

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