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FTC ने सदस्यता रद्द करने के लिए "क्लिक-टू-कैन्सल" नियम पेश किया

FTC Introduces New “Click-to-Cancel” Rule to Simplify Subscription Cancellations

The Federal Trade Commission (FTC) in the United States has approved a new rule known as the “click-to-cancel” rule, aimed at making it easier for consumers to cancel subscriptions and memberships. This rule was sanctioned on October 16, 2024, with a narrow 3-2 vote. It addresses common frustrations people encounter when trying to stop services they no longer wish to use.

Key Features of the Rule

The click-to-cancel rule ensures that canceling a subscription is as straightforward as signing up for it. Some of its key aspects include:

• Cancellation Method: Consumers who signed up for a service online must also be able to cancel it online. If a service was initiated over the phone, cancellation should also be possible by phone.

• No Need to Speak to a Representative: If consumers didn’t have to talk to someone when signing up, they shouldn’t have to do so to cancel.

• No Extra Fees: Companies are prohibited from charging additional fees for canceling over the phone, and they must respond promptly to calls or messages regarding cancellations.

• Multiple Cancellation Options: If a service was signed up for in person, companies are required to offer cancellation options online or by phone.

Applicability of the Rule

This rule encompasses various programs where customers are automatically charged unless they take steps to cancel, including automatic renewals and free trials. The FTC categorizes these as “negative option” programs, where companies assume consent to continue services unless a customer explicitly opts out.

Legal Framework

The new rule prohibits companies from:

• Misleading customers through marketing materials.

• Failing to disclose important details before charging customers.

• Charging customers without their clear consent.

• Making cancellation difficult, thereby preventing future charges.

Why the Rule Was Created

The FTC updated this rule, originally established in 1973 under the Negative Option Rule, to reflect changes in the digital landscape. Complaints about the difficulty of canceling subscriptions have surged, rising from an average of 42 complaints per day in 2021 to nearly 70 per day in 2024. Many consumers also struggle to keep track of what they are paying for, often underestimating their costs by an average of $133 per month for unused services.

Comparison to Indian Regulations

In contrast, India currently lacks a similar rule to protect consumers during the cancellation process, leaving many without the same protections that exist in the United States.

About the FTC

Founded in 1914, the FTC’s mission is to halt unfair business practices and promote competition. The agency enforces antitrust laws and protects consumers by investigating companies and issuing orders to cease harmful practices. Additionally, the FTC works to prevent false advertising and provides consumer education. Comprising five members appointed by the President, the FTC is currently focused on issues related to digital privacy and data security. While the agency can impose fines for violations, it does not have the authority to file criminal charges.

With the introduction of the click-to-cancel rule, the FTC aims to empower consumers and enhance their ability to manage subscriptions effectively in an increasingly digital world.