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- Under the current ARL requirements, if a California consumer accepts an automatic renewal offer online, the business must allow the consumer to cancel the offer exclusively online.
www.americanbar.org/groups/business_law/resources/business-law-today/2022-august/let-em-out-rosca/Let ’Em Out! ROSCA and Changes to California’s Auto-Renewal Law
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- Key Takeaways
- Background
- Revisions to The California Law
- Other Noteworthy State Developments
The FTC remains committed to bringing enforcement actions against allegedly unfair or deceptive auto-renewal offers, including those that employ so-called “dark patterns.”The many existing requirements of the California law continue to apply to a company that offers subscriptions to consumers. Effective July 1, 2022, a company that offers either (1) a subscription w...While there are many similarities across state auto-renewal laws, some impose requirements that are in addition to or different from those imposed by other states.Over the past decade, subscription models have become ubiquitous. The term “subscription” has more than tripled in frequency on Google Trends since 2011. Now, consumers take advantage of subscriptions daily: music streaming, “cutting the cord,” cloud storage, home security, fitness, dating, gaming, cooking, and a variety of surprise boxes. In a rec...
The California law already requires, for example, “clear and conspicuous” (a defined term) notice of all terms of the subscription offer, a consumer’s affirmative consent to those terms, and a simple means of cancellation. The amended law introduces the following new requirements, which mirror those of certain other states’ laws, and take effect on...
A new auto-renewal law is applicable to contracts executed on or after January 1, 2022. Like the laws of other states, the Colorado law requires, for example, “clear and conspicuous” (a defined term) notice of the offer terms and written acknowledgment of an order that includes details on, among other things, how to cancel. The method of cancellati...
Oct 4, 2021 · Online sellers of automatic renewal plans will have to offer subscribers the ability to cancel automatic renewal features online “immediately” (after account authentication) by clicking on a button or link, or by sending a pre-formatted termination email message.
Oct 9, 2024 · Notably, if a business allows a consumer to accept such an offer online, it must allow the consumer to also terminate the auto renewal exclusively online with no extra steps. Another meaningful change requires businesses to obtain consumers’ express affirmative consent to the terms of an auto renewal contract offer.
The new amendment creates more rigid requirements for online cancellation, by requiring sellers to allow California residents to cancel “at will, and without engaging any further steps that obstruct or delay the consumer’s ability to terminate the automatic renewal or continuous service immediately” (Bus & Prof. Code § 17602(d)(1)).
Jun 28, 2022 · If a business allows for online acceptance of an automatic renewal or continuous service offer, then it must also allow for online cancellation, which can include providing a template termination email that the consumer can send.
Oct 2, 2024 · While the law does not require telephone cancellations, if a consumer leaves a voicemail requesting cancellation, the business has to either process the cancellation or call the consumer back regarding the cancellation request within one business day.