Sacramento, California – In a move aimed at protecting consumers from burdensome subscription cancellationprocesses, California Governor Gavin Newsom signed the state’s Click to Cancel bill (Assembly Bill 286) into law on Wednesday. The legislation, whichtakes effect in mid-2025, mandates that companies offering online or in-app subscriptions must provide an equally convenient method for canceling those subscriptions.
Previously, consumers often faced significant hurdles when attempting to cancel subscriptions. They might be forced to navigate complex phone menus, wait on hold for extended periods, and then engage in lengthy conversations with customer service representatives to finally secure a cancellation. This starklycontrasted with the ease of signing up for subscriptions, which typically involved just a few clicks.
Assemblymember Pilar Schiavo, a key proponent of the bill, highlighted its significance: Assembly Bill 286 is the most comprehensive ‘Clickto Cancel’ legislation in the nation, ensuring that Californians can easily cancel unwanted auto-renewals with just a couple of clicks, just as easily as they signed up.
The new law specifically targets companies that offer subscriptions through websites or mobile applications. It requires these companies to provide a clear and accessible cancellation option withinthe same platform where the subscription was initially purchased. This means that consumers can now cancel their subscriptions without having to resort to phone calls or other cumbersome methods.
The Click to Cancel law is a response to growing concerns about the difficulties consumers face in ending subscriptions. The Federal Trade Commission (FTC) has also beenactively addressing this issue. Earlier this year, the FTC sued Adobe, accusing the company of charging early termination fees and creating barriers to cancellation, practices the FTC deemed unlawful. Last year, the FTC proposed a similar nationwide law, but the final rules are yet to be implemented.
The California law provides companies with agrace period to comply. While the law officially takes effect in mid-2025, companies will have until then to implement the necessary changes to their online platforms.
The Click to Cancel law is expected to have a significant impact on the online subscription industry. By simplifying the cancellation process, it empowers consumers totake control of their subscriptions and avoid unwanted charges. This move is likely to encourage greater transparency and accountability from companies offering subscription services, ultimately benefiting both consumers and the industry as a whole.
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