Three industry groups are suing to prevent the Federal Trade Commission (FTC) from enforcing its new “Click to Cancel” rule, which requires companies to make it easier to cancel subscriptions Reuters. And yes, it is exactly what you would expect.
Click to Cancel expands the negative option rule to prohibit companies from inducing customers to cancel services by any means other than signing up. So if you register online, you must have the option to cancel online instead of having to call support, write a letter, or show up in person. Most aspects of the rule, unless blocked, will take effect 180 days after it is entered into the Federal Register.
This is “arbitrary, capricious and an abuse of discretion,” the Internet and Television Association, the Electronic Security Association and the Interactive Advertising Bureau allege in their lawsuit filed today with the U.S. Court of Appeals. The groups – many of their member companies benefit from subscriptions that are easy to start and harder to stop – argue that the FTC is trying to “regulate consumer contracts for all businesses in all industries and in all sectors of the economy.”
In fact, the rule applies to any auto-renewing subscription, whether it's a gym membership or Amazon Prime, including free trials or plans that give you easy-to-prepare dinners. The horror!