The laws that govern auto-renewal (US and UK, April 2026)

The FTC's Click-to-Cancel Rule (16 CFR Part 425) was finalised on 15 October 2024 under FTC Chair Lina Khan's tenure and took effect on 14 May 2025. It significantly expands the FTC's longstanding "Negative Option Rule" to cover nearly all subscription and auto-renewal offerings in commerce.

Key provisions: (1) cancellation must be provided via a mechanism that is "at least as easy" as the signup method -- if you signed up online in three clicks, cancellation must be available online in three clicks; (2) annual renewal reminders are required for subscriptions longer than one year, sent in a "clear and conspicuous" manner before the renewal; (3) clear disclosure of all material terms must appear before the vendor collects billing information; (4) affirmative consent is required for auto-renewal enrolment, separate from the general terms acceptance.

Enforcement status as of April 2026: the FTC has issued warning letters to several large subscription vendors. The rule survived initial legal challenges. Several vendors added online cancellation portals ahead of the effective date. Phone-tree-only cancellation is now presumptively non-compliant for services that offer online signup.

California's auto-renewal provisions under the Consumers Legal Remedies Act are among the strictest in the United States and apply to any business offering auto-renewing subscriptions to California residents, regardless of where the business is incorporated. The 2024 amendment (AB 2863, signed by Governor Newsom) tightened disclosure standards further.

Key requirements: "clear and conspicuous" disclosure of auto-renewal terms before accepting payment, affirmative consent separate from general terms, online cancellation rights for services sold online (section 17600(b)(1) -- if you can sign up online, you must be able to cancel online), renewal reminders sent 3-21 days before annual renewals.

Remedies include: a private right of action, statutory damages up to $1,000, actual damages, attorney fees. Class actions are expressly available. Notable settlements: Hulu (2020, $35 million class action on auto-renewal disclosures), Comcast (2022, $10 million settlement on promo-to-rack rate transitions).

New York's Automatic Renewal Law applies to any contract with a New York consumer and has a notable advance-notice requirement: for subscriptions over $50 per year, vendors must send a renewal reminder 15-45 days before the renewal date. This is stricter than the FTC rule's annual-only requirement and catches monthly contracts that meet the annual threshold.

Key provisions: "clear and conspicuous" auto-renewal disclosure in the initial offer, renewal reminder 15-45 days before renewal for contracts over $50/yr, cancellation mechanism as easy as signup (codified into NY law ahead of the FTC rule). A private right of action is available, and the AG's office actively enforces.

The Digital Markets, Competition and Consumers Act 2024 received Royal Assent on 24 May 2024. The subscription-contract provisions (Part 4) commenced on a staggered schedule through 2026 and represent the UK's most comprehensive regulation of auto-renewal and subscription contracts to date.

Key provisions: reminder notices required before each billing period for subscription contracts, a 14-day cooling-off right after any automatic renewal, a clear and straightforward cancellation route (online, accessible from within the service), and a broad definition of "subscription contract" that captures most recurring digital and physical service arrangements.

Enforcement: the Competition and Markets Authority (CMA) enforces the Act. Unlike the US approach, there is no private right of action under the DMCC Act -- enforcement runs through the CMA, which can impose fines of up to 10% of global annual turnover for breach. The CMA opened an investigation into subscription practices in the fitness and media sectors in early 2026.

Interaction with the Consumer Rights Act 2015: the CRA's unfair contract terms provisions continue to apply alongside the DMCC Act. Clauses that unreasonably limit cancellation rights may still be challenged under the CRA.

If you are in the US: the FTC rule plus your state ARL means most renewal traps now require proper disclosure. If the disclosure was not clear and conspicuous -- if the rack rate was buried in terms, not shown next to the price -- the renewal may be legally challengeable. The practical first step is a chargeback (see cancel and resign) plus a complaint to your state AG.

If you are in the UK: the DMCC Act's reminder and cancellation provisions give you strong tools. If a vendor fails to send the required reminder or makes cancellation unreasonably difficult, a complaint to the CMA is appropriate and the FCA's guidance on subscription fees applies to financial services.

This page is a summary for general information purposes. Consult a qualified attorney for your specific situation. Laws change; this page was last verified April 2026.