On July 14, 2025, the Federal Trade Commission (FTC) will begin enforcing its new “Click-to-Cancel” rule, designed to make it easier for consumers to cancel subscriptions and recurring payment programs. Originally slated for May, the rule’s compliance deadline was extended by 60 days to give businesses more time to adapt to its requirements. 

The rule applies to “negative option” programs, i.e., subscriptions that automatically renew unless the consumer cancels prior to the renewal date. It mandates that businesses must make cancellation as simple as the sign-up process. For example, if a customer subscribes online, they must be able to cancel online without being forced to call customer service or navigate through unnecessary steps. 

Among other requirements, under the new rule, businesses must:

• Provide a straightforward cancellation mechanism. The cancellation process must be as easy to use as the method the consumer used to sign up. If you clicked to subscribe, you must be able to click to cancel. For in-person sign-ups, a toll-free number should be provided for cancellation.
• Obtain informed consent. Before charging consumers, businesses must clearly disclose all material terms, including the fact that charges will be recurring, the amount and frequency of charges, and how to cancel. 
• Avoid misrepresentations. Businesses are prohibited from making false or misleading statements about their products or services in connection with negative option features.

The FTC introduced the rule in response to a growing number of consumer complaints about difficult cancellation processes and deceptive subscription practices. The agency's aim is to enhance transparency and protect consumers from being trapped in unwanted subscriptions. 

Companies offering subscription-based services should review and, if necessary, update their cancellation procedures to ensure compliance with the new rule by July 14, 2025. Failure to comply could result in enforcement actions and civil penalties. 

For more information, visit the FTC’s linked official announcement it issued last year, and/or the official text of the rule.