New York City's "Click to Cancel" rule, which requires that subscriptions purchased online be cancellable online, takes effect Oct. 1. Violators face fines starting at $525 and may have to refund consumers. The Department of Consumer and Worker Protection (DCWP) will begin accepting complaints the same day.
The "Click to Cancel" rule created by the New York City Department of Consumer and Worker Protection (DCWP) takes effect Thursday, Oct. 1. The key requirement is that a subscription purchased online must be cancellable online, using the same method used to sign up. Businesses that violate the rule face civil penalties starting at $525 and may also have to refund consumers' payments. New York is the first city government in the country to adopt such a rule.
The rule makes four demands of businesses. They must explain subscription terms in a way consumers can understand, and must clearly inform consumers of their rights when they sign up or cancel. They must also offer a simple cancellation process through the same means used to sign up. This means a business can no longer enroll customers through an app or website and then accept cancellations only by phone or mail. Businesses are also barred from passing the cost of return shipping on to consumers when taking back items that were provided free of charge.
Complaints accepted starting Oct. 1
Starting Oct. 1, the effective date, consumers can report businesses that make cancellation difficult to the DCWP. The city is accepting email sign-ups at nyc.gov/click-to-cancel to notify people when the complaint portal opens. Consumer complaints can also be filed by calling 311.
Announcing the rule on July 10, Mayor Zohran Mamdani said, "If you can sign up with one click, you should be able to cancel with one click." The proposed rule went through a public comment period in April and May of this year, and 73 comments were submitted online alone. Most were from consumers describing their experiences of being unable to cancel gym memberships and streaming and telecommunications services.
Industry groups and some chambers of commerce asked for an exception, arguing that consumer choice would be reduced if businesses were also barred from showing "retention offers," such as discounts, on the cancellation screen. Some comments also asked that telecommunications carriers regulated by the Federal Communications Commission or the state Public Service Commission be excluded from the rule. The DCWP has completed the comment period and decided to finalize the rule and put it into effect Oct. 1.