The Federal Trade Commission had voted in a rule that would make it easier to cancel subscription services, but the start of that rule has been pushed back until July 14. Initially, the regulation — called the Negative Option Rule — went into effect on January 19, but certain provisions weren’t set to kick in until May 14. These provisions would require companies to make it as easy to cancel a subscription as it is to sign up.
Numerous telecom companies spoke out against the ruling. The National Cable and Telecommunications Association filed a lawsuit to appeal the decision, claiming that the FTC had overstepped the limits of its authority. The decision to delay these provisions by 60 days is due to the “complexities” of changing the processes, and the FTC says it has “acknowledged that compliance entailed some level of difficulty” and “determined that the original deferral period insufficiently accounted for the complexity of compliance.”
According to the FTC’s statement, companies have until July 14 to get their processes in order. At that point, “regulated entities must be in compliance with the whole of the Rule because the Commission will begin enforcing it.” That sounds like a win for consumers, but the FTC makes another caveat: “Of course, if that enforcement experience exposes
problems with the Rule, the Commission is open to amending the Rule to address any such
problems.”
Certain subscription services are notorious for the hoops customers have to jump through in order to cancel. The option to cancel is often hidden deep within menus, and in some cases, the only way to cancel is by contacting customer service. This process can take over an hour, assuming you don’t get disconnected during that time. And let’s not even get started on cancelling something like a gym membership; some people have reported closing bank accounts just to get the gym off their backs. The FTC’s ruling is intended to make the process more consumer-friendly, and it can’t go into effect soon enough.
