Washington, D.C. — In response to a new proposed rule announced by the Federal Trade Commission today to prevent subscription services that make it difficult for consumers to unsubscribe from services or halt recurring payments, the American Economic Liberties Project released the following statement.

“The FTC’s new rulemaking today exposes all too common subscription traps for what they truly are: theft,” says Morgan Harper, Director of Policy & Advocacy at the American Economic Liberties Project. “These deceptive practices aren’t just annoying, they’re a real burden on the pocketbooks of millions of working families. If companies can find a way to let you subscribe to a service in 30 seconds or less, they too can make it just as easy to cancel it. We’re thrilled the FTC is taking action to protect consumers from these unfair tactics, which illustrate yet another way that corporate power rigs the system in their favor.”

The agency’s Notice of Proposed Rulemaking (NPRM) takes aim at the thousands of online services that make it easy for consumers to sign up for a free trial, load them up with recurring charges, and then direct them to an opaque process to make cancellation of said service as hard as possible.

The FTC proposes to amend its Negative Option Rule to prohibit misrepresentations, give people important information in clear ways, make sure people know what they’re agreeing to and let people cancel simply and easily. The amended rule would:

• Set clear, enforceable, performance-based requirements
• Apply to all subscription features in all media
• Make sure people understand and agree to what they’re buying
• Make sure people can cancel without jumping through lots of hoops

In October 2021, the FTC issued an enforcement policy statement which warned companies to stop using misleading tactics to trap consumers into a subscription service and then make it hard to cancel. As said in the statement, these deceptive tactics take shape through confusing language, a lack of sign up notice, obstacles to cancelling a subscription service, and more.

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.