FTC Delays Enforcement of Click-to-Cancel Subscription Rule Until July

The Federal Trade Commission (FTC) has announced a 60-day delay in enforcing the Negative Option Rule, commonly known as the “click-to-cancel” rule, pushing the enforcement date to July 14, 2025. This rule requires companies to make canceling subscriptions as easy as signing up, targeting businesses that complicate cancellation processes to retain customers unfairly.

Initially announced in 2023 and effective from January 19, 2025, the rule applies to both physical and digital goods subscriptions, including streaming services and gym memberships. It mandates that if a customer signs up through a simple online process, they must be able to cancel using the same method without additional hurdles.

The FTC delayed enforcement from May 14 to July 14 after reassessing the compliance burden on businesses. The commission unanimously voted 3-0 for the delay, citing the complexity of implementing the rule fully within the original timeframe.

The rule also requires companies to provide clear cancellation information before collecting payment details, enhancing transparency and consumer protection. The FTC emphasized that enforcement will begin on July 14, and it remains open to amending the rule based on enforcement experiences and feedback.

This regulatory development comes amid leadership changes at the FTC, with two Democratic commissioners recently fired, leading to ongoing legal challenges. Despite these challenges, the FTC is committed to enforcing consumer-friendly subscription practices.

For businesses, this means preparing subscription management systems to comply with the rule’s requirements, ensuring cancellation processes are straightforward and transparent. Failure to comply could result in regulatory penalties and damage to brand reputation.

Consumers stand to benefit from this rule as it curtails deceptive practices that trap users in unwanted subscriptions, promoting fairness and trust in digital and physical subscription services.