Will ‘click to cancel’ get canceled? recent FTC rule faces legal, political challenges

Stuck paying for a subscription or membership you no longer desire or require? The Federal Trade percentage’s “click to cancel” rule set to receive result Tuesday may assist. 

But the upcoming of the recent rule is already in question. Businesses don’t have to comply until May 14 and “click to cancel” faces mounting legal and political challenges.

“That’s a long period for courts to rule or the FTC to decide not to enforce it or make another selection,” Teresa Murray, customer watchdog director at community earnings Research throng, told USA TODAY.

Announced in October, the recent rule requires businesses to make it as “at least as straightforward” to cancel a service as it was to sign up. Also, businesses must get consent for subscriptions, auto-renewals and free trials that convert to paid memberships. 

Some 20 states and Washington have laws on automatic renewal with similar requirements.

FTC ‘click to cancel’ rules faces legal challenges

Industry and trade groups declare “click to cancel” places too many burdens on businesses and they are suing to block the FTC from enforcing it. 

The U.S. Chamber of Commerce called the rule “the latest abuse of power by a percentage determined to micromanage the economy and undermine American free enterprise.”

“This rule will deter businesses from providing sensible, customer-amiable subscriptions, leaving Americans with fewer options, higher prices, and more hoops to jump through,” the chamber said in a statement.

Will Trump administration reverse ‘click to cancel’ rule?

“Click to cancel” could soon discover itself on shaky political ground, too.

The FTC’s selection in favor of the recent rule was split along political lines. Part of President Joe Biden’s crackdown on “junk fees,” it passed 3-2, with the FTC’s two GOP commissioners voting against it.

Under the upcoming Trump administration, the FTC is expected to “operate with a lighter touch when it comes to customer protection issues,” according to an analysis from the Morrison Foerster law firm. 

A transformation in leadership at the agency could also cruel large changes for “click to cancel” as the FTC chair can open and close investigations without a vote of commissioners.

Andrew Ferguson, an FTC commissioner and President-elect Donald Trump’s pick to run the agency, has opposed much of the agency’s rulemaking agenda under Chair Lina Khan. Ferguson said he voted against “click to cancel” because it came during the lame-duck period.

The rule could also be dialed back or rescinded under the normal rulemaking procedure. 

“While it may receive some period for such actions to receive place, it is also feasible that the recent Trump administration will not enforce the Final Rule once President Trump takes office,” the Morrison Foerster analysis said.

Consumers fed up with challenging-to-cancel subscriptions

Some subscriptions can be canceled with a couple of clicks or a phone call. But, when companies make it challenging to cancel a subscription, customer advocates declare customers can complete up with monthly charges long after they no longer desire or require a subscription or membership.

“We recognize signing up for subscriptions is so straightforward, it is miraculous. That is why we recognize that the hardship of cancellation is not an accident. It is a selection. And it’s a selection that’s causing real damage to consumers,” Samuel Levine, director of the FTC’s Bureau of customer Protection, told USA TODAY last year.

Complaints about challenging-to-quit subscriptions have soared in recent years. The FTC estimates it receives nearly 70 a day on average.

After proposing the rule last year, the FTC received thousands of comments from consumers who had trouble canceling services, from cable subscriptions to subscriptions for dietary supplements.

The FTC rule “prohibits companies from ‘misrepresenting any material truth while marketing goods or services,’ failing to disclose relevant information before getting the customer’s settlement information, failing to get a customer’s permission before charging them and failing to make it ‘straightforward’ to cancel a subscription,” PIRG’s Murray said. “How are those practices impoverished for business?”