The FTC click-to-cancel rule is a federal regulation that required subscription businesses to disclose recurring charges clearly, get express consent before billing, and make cancelling as easy as signing up. The Federal Trade Commission finalized it in October 2024. A federal appeals court vacated it in July 2025, before it took effect. In 2026 the FTC restarted the rulemaking from scratch, and as of September 2026 there is no federal click-to-cancel rule in force.

That does not mean you can relax your cancel flow. Around 30 states have their own automatic renewal laws, several of them stricter than the federal rule ever was, and the FTC kept suing subscription companies under older statutes the whole time. If you sell subscriptions to customers in California, New York, Connecticut, Colorado, Minnesota, or a growing list of other states, “cancel as easily as you signed up” is already the law for you.

This guide covers what the rule required, why it was struck down, what the FTC is doing now, which state laws apply today, and how to build a cancel flow that satisfies all of them without giving up your ability to save customers.

What the Click-to-Cancel Rule Is

“Click-to-cancel” is the nickname for the FTC’s amended Negative Option Rule. A negative option is any offer where the customer’s silence is treated as agreement to keep paying: automatic renewals, free trials that convert to paid, continuity plans, and prenotification plans like the old book-of-the-month clubs.

The 2024 version of the rule had three core requirements for every negative option seller:

  1. Clear and conspicuous disclosure. Before collecting billing details, tell the customer the price, the billing frequency, when the charge starts, and how to cancel, in a way they will actually notice.
  2. Express informed consent. Get a separate, affirmative agreement to the recurring charge. A pre-ticked box or a buried line in the terms does not count.
  3. Simple cancellation. The cancellation mechanism must be at least as easy to use as the signup mechanism, and it must be available through the same medium. If someone signed up online, they must be able to cancel online, without calling, chatting with an agent, or waiting for an email.

The rule also banned misrepresenting any material fact about the offer, which gave the FTC a hook for the “free” trial that quietly becomes an annual plan.

The 1973 original rule only covered prenotification plans, a tiny category. The 2024 amendment extended it to every subscription sold in the United States, in any medium. That scope, and the compliance cost that came with it, is what got it into court.

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Where the Rule Stands in 2026

Here is the timeline, with the dates that matter.

DateWhat happened
March 2023FTC proposes the click-to-cancel provision as an amendment to the Negative Option Rule
October 16, 2024FTC announces the final rule
November 15, 2024Rule published in the Federal Register; most provisions set to take effect July 14, 2025
July 8, 2025The U.S. Court of Appeals for the Eighth Circuit vacates the rule in full (Custom Communications, Inc. v. FTC)
February 12, 2026FTC formally removes the vacated text from the Code of Federal Regulations, restoring the 1973 prenotification-only rule
March 13, 2026FTC publishes an Advance Notice of Proposed Rulemaking (ANPRM) in the Federal Register asking whether and how to rebuild the rule
April 13, 2026ANPRM comment period closes, with roughly 100 comments filed
September 2026No Notice of Proposed Rulemaking has been published. The FTC’s rule page still shows the March ANPRM as the latest step

So the federal rule is at the earliest stage of a do-over. An ANPRM contains no draft regulatory text. It asks questions: is a new rule needed at all, should the FTC reuse parts of the vacated rule, should certain industries get different treatment. After reviewing the comments the Commission can issue a proposed rule, propose narrower amendments, or drop the effort.

Even in the fastest case, a new final rule would need a proposed rule, a comment period, the preliminary regulatory analysis the court said was missing, and a compliance window. Realistically that puts any federal requirement into 2027 or later. Plan around the state laws and the enforcement cases below, not around a federal deadline.

Why the Eighth Circuit Vacated the Rule

The court did not say easy cancellation is a bad idea. It said the FTC skipped a step.

Under the FTC Act, when a rule is expected to have an annual economic effect above 100 million dollars, the Commission has to publish a preliminary regulatory analysis alongside the proposed rule so the public can comment on the costs and alternatives. The FTC’s own presiding officer found the rule would clear that threshold, but the agency only produced the analysis with the final rule, not the proposed one. The Eighth Circuit ruled that this deprived businesses of a meaningful chance to challenge the cost estimates, and vacated the entire rule rather than sever the flawed part.

Two things follow from that:

  • The substance of the rule was never rejected. Any revived rule will almost certainly carry the same three requirements.
  • The FTC now knows exactly which procedural box to tick. The ANPRM route it chose in 2026 is the slow, careful path designed to survive the next lawsuit.

Enforcement Did Not Stop

The FTC lost the rule, not its authority. Two statutes were already on the books and cover most of the same ground:

  • ROSCA, the Restore Online Shoppers’ Confidence Act of 2010, makes it illegal to charge for an online negative option unless you clearly disclose the material terms, obtain express informed consent, and provide a simple mechanism to stop recurring charges. Read that list again. It is the click-to-cancel rule in miniature, and it has been federal law since 2010.
  • Section 5 of the FTC Act prohibits unfair or deceptive acts or practices, which is how the agency attacks confusing enrollment screens and hidden cancellation paths.

The cases since the vacatur show how aggressively those statutes are being used:

  • Amazon agreed in September 2025 to 2.5 billion dollars in refunds and civil penalties over Prime enrollment screens and a cancellation flow the FTC described as deliberately difficult.
  • Chegg paid 7.5 million dollars in 2025 for continuing to bill customers who tried to cancel, hiding the online cancellation option, and ignoring complaints about it.
  • Match.com paid 14 million dollars in 2025 over misleading free trial offers, suspending the accounts of customers who disputed charges, and confusing cancellation procedures.
  • Uber is being sued over the Uber One membership, with the FTC adding civil penalty claims and 21 state attorneys general as co-plaintiffs. The core allegation is that the membership was too hard to cancel.
  • Earlier, Care.com paid 8.5 million dollars in 2024 over subscription practices.

The pattern is clear. Cancellation friction is treated as deception, and the fines are set to hurt. If your cancel flow requires a phone call, hides the cancel button behind several screens, or keeps billing after the customer clicks cancel, you are exposed today, rule or no rule.

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State Click-to-Cancel Laws You Must Follow Now

While the federal rule sits in the ANPRM stage, the states have been busy. Most subscription businesses sell nationally, which means the strictest state law you touch effectively becomes your standard. These are the laws that changed most recently or bite the hardest.

JurisdictionLawIn effectWhat it adds
CaliforniaAB 2863 amendments to the Automatic Renewal LawJuly 1, 2025Express affirmative consent to renewal terms, proof of consent retained for at least three years, annual renewal reminders, notice of material price or service changes, and a “click to quit” online cancellation for anyone who signed up online, with an equivalent for phone signups
New York StateGeneral Business Law 527 and 527-aNovember 5, 2025 (renewal notice rule since December 13, 2023)Cancel through every medium used to obtain consent; advance notice and affirmative consent for price increases, with the right to cancel and receive a prorated refund; 15 to 45 day renewal reminders for terms of a year or more
New York CityDepartment of Consumer and Worker Protection click-to-cancel ruleOctober 1, 2026Cancellation as simple as enrollment through the same channels, an online option even for in-person signups, renewal notices 15 to 45 days before the deadline, free-trial charge notices 3 to 21 days ahead, and penalties of 525, 1,050 and 3,500 dollars per violation with each deceptive statement counted separately
ConnecticutSB 3 amendmentsJuly 1, 2026Annual renewal reminders regardless of term length, voicemail cancellations processed within one business day, and no retention offers before telling the subscriber they can cancel at any time
ColoradoSB25-145August 6, 2025 (B2B expansion February 16, 2026)Extends the auto-renewal law to business-to-business subscriptions and requires a one-step online cancellation link for online signups
MinnesotaAutomatic renewal lawJanuary 1, 2025Annual reminders for every subscription, and no unsolicited save offers during cancellation unless the consumer first agrees to hear them
MarylandHB 107June 1, 2026Notices before free trials or discount periods longer than 14 days end; a clear alternative cancellation path for customers who cannot use an online account
VirginiaCancel-as-easy-as-signup amendmentJuly 1, 2026Cancellation must be at least as easy as enrollment
MassachusettsAttorney General regulationsSeptember 2, 2025Prescriptive trial-offer rules, including calendar-date disclosure of when a trial expires
LouisianaClick-to-Cancel ActJanuary 1, 2027New disclosure, consent and cancellation requirements for businesses serving Louisiana consumers

Three points to take from that table.

Colorado quietly changed the game for B2B SaaS. Most automatic renewal laws only protect consumers. Colorado’s now covers business subscriptions too, which means the “we sell to companies, so the consumer laws do not apply” defense no longer holds nationally.

Private lawsuits are the bigger risk. State laws like California’s are enforced by class action lawyers as well as regulators. A cancel flow that trips the California ARL can produce a lawsuit even if the FTC never looks at you.

The direction is one way. Texas, Michigan, Georgia and Pennsylvania all have bills modelled on California’s law pending in 2026. Nobody is loosening these rules. Building to the strictest standard now is cheaper than rebuilding every time a state acts.

What a Compliant Cancel Flow Looks Like

Put the statutes side by side and a single design emerges. If your cancellation experience passes these seven checks, you satisfy ROSCA, every current state law, and whatever the FTC eventually revives.

1. Cancel Lives Where Signup Lives

If a customer can subscribe on your website or in your app, they must be able to cancel there. No “call us during business hours,” no “email support and we will process it.” A phone or chat option can exist alongside, never instead of, the online path.

2. The Cancel Button Is Easy to Find

A reasonable customer should reach the cancel action from their account or billing page in one or two clicks. Burying it under a settings submenu, labelling it “manage plan” with no cancel option visible, or requiring a search of the help center all fail the “as easy as signing up” test. Signup took one screen; cancelling should too.

3. Cancellation Takes Effect When the Customer Confirms

Chegg was fined for continuing to charge after cancellation attempts. Once the customer confirms, stop future billing immediately and confirm by email with the effective date. Whether access continues to the end of the paid period is your call; whether the next charge happens is not.

4. Any Retention Offer Is Declinable in One Click

You are allowed to try to keep the customer (with exceptions covered below). You are not allowed to trap them. One offer, one screen, with a decline option as prominent as the accept option, and the cancel action completing right after. Multi-step “are you sure” loops are exactly what the Amazon case punished.

5. Disclosures Happen Before the Card Is Entered

Price, billing interval, the date of the first charge, how a trial converts, and how to cancel must all be visible before you ask for payment details. Put them next to the checkout button, not in a linked terms page.

A dedicated checkbox or button that agrees only to the recurring charge, unticked by default. Store the timestamp, the offer terms shown, and the customer’s action. California requires you to keep this for at least three years.

7. Renewal and Price-Change Notices Go Out on Time

Annual reminders for every subscription (Connecticut, Minnesota, California), 15 to 45 day notices for annual terms (New York), advance notice with a right to cancel for price increases (New York), and trial-ending notices (Maryland, New York City, Massachusetts). A billing system that cannot send these on schedule is a compliance gap in itself.

A well-built cancel flow does all seven and still recovers a meaningful share of cancellations, because the customers who leave for a fixable reason get shown a fix, and the ones who are done leave without resentment.

Can You Still Make Save Offers?

Yes, in most places, with conditions. The lazy reading of click-to-cancel is “no retention offers allowed.” That is wrong. The vacated federal rule explicitly permitted a save offer during cancellation as long as the customer could decline it and complete the cancellation immediately. ROSCA says nothing against offers. What the law targets is offers used as obstacles.

Two states do restrict them, and you need location-aware logic for both:

  • Minnesota bars unsolicited retention offers during cancellation. You may ask “would you like to see an offer before you go?” and show one only if the customer says yes.
  • Connecticut (from July 1, 2026) requires you to tell the subscriber they can cancel at any time before you mention any discount, benefit, or consequence of cancelling.

For everyone else, the safe pattern is:

  1. The customer clicks cancel.
  2. One short, optional reason survey (this is data you want, and it is legal everywhere).
  3. One offer matched to the reason: a discount for “too expensive,” a pause instead of cancel for “not using it right now,” a downgrade for “too many features I do not need.”
  4. A decline button as visible as the accept button.
  5. Cancellation completes on decline, with an email confirmation.

That flow is compliant in all 50 states when Minnesota and Connecticut get their variants, and it converts. The offers that work are the ones tied to the reason the customer gave, which is why the survey comes before the offer, not after.

One more thing the statutes make clear: a save offer must never be a condition of cancelling. “Talk to a retention specialist to complete your cancellation” is the phrasing that shows up in enforcement complaints.

Compliance Checklist

Run this against your current flow. Anything unchecked is a risk under at least one live law.

Before the charge

  • Price, billing frequency, first charge date and trial conversion terms displayed next to the checkout button
  • A separate, unticked consent control for the recurring charge
  • Consent records (terms shown, timestamp, action) stored for at least three years
  • Cancellation method stated at signup

During the subscription

  • Annual renewal reminder to every subscriber, with cancellation instructions
  • 15 to 45 day reminder before any annual or longer renewal
  • Advance notice of price increases with a cancel option and, where required, a prorated refund path
  • Trial-ending notice with the exact date of the first charge

At cancellation

  • Online cancellation for every online signup, reachable in one or two clicks
  • A phone or email alternative for customers who cannot use the online path
  • At most one retention offer, declinable in one click, and not shown at all in Minnesota unless requested
  • “You can cancel at any time” stated before any offer in Connecticut
  • Billing stops on confirmation; email confirmation sent with the effective date
  • No account suspension or penalty for customers who dispute a charge

Ongoing

  • Someone owns tracking new state laws (Louisiana lands January 2027; NYC lands October 2026)
  • The FTC Negative Option Rule page is checked quarterly for a proposed rule
  • Cancellation reasons and save rates are reviewed monthly so compliance work also cuts voluntary churn

Frequently Asked Questions

Why Was the Click-to-Cancel Law Blocked?

The Eighth Circuit vacated the FTC’s rule on July 8, 2025 because the agency did not publish a preliminary regulatory analysis when it proposed the rule, which the FTC Act requires for rules with an annual economic impact above 100 million dollars. The court did not rule on whether easy cancellation is a legitimate requirement. The decision was procedural, and the FTC restarted the rulemaking in March 2026 to fix the defect.

Is the FTC Click-to-Cancel Rule in Effect in 2026?

No. The 2024 rule never took effect and was removed from the Code of Federal Regulations in February 2026. Only the 1973 prenotification rule remains federally. The FTC issued an Advance Notice of Proposed Rulemaking in March 2026, the comment period closed in April 2026, and as of September 2026 no proposed rule has been published.

Which States Have Click-to-Cancel Laws?

Around 30 states have automatic renewal laws. The strictest and most recent include California (July 2025), New York State (November 2025), Minnesota (January 2025), Massachusetts (September 2025), Colorado (August 2025, extended to B2B in February 2026), Maryland (June 2026), Connecticut and Virginia (July 2026), New York City’s municipal rule (October 2026), and Louisiana (January 2027). Texas, Michigan, Georgia and Pennsylvania have bills pending.

Is It Illegal to Make It Hard to Cancel a Membership?

Under ROSCA, any online subscription must provide a simple mechanism to stop recurring charges, and the FTC treats deliberately difficult cancellation as a deceptive practice under Section 5. Amazon, Chegg and Match.com all settled cases in 2025 built on that theory. Most state automatic renewal laws add their own “as easy as signing up” standard. So yes, in practice, it is illegal for online subscriptions almost everywhere in the United States.

Is It Illegal to Have to Call to Cancel a Subscription?

If the customer signed up online, requiring a phone call to cancel violates California’s ARL, New York’s law, Colorado’s one-step requirement, the NYC rule, and the ROSCA “simple mechanism” standard as the FTC applies it. Phone cancellation is fine as an additional option. It cannot be the only option for an online signup.

Do Click-to-Cancel Laws Apply to B2B SaaS?

Historically most automatic renewal laws protected consumers only. Colorado’s amendment, effective February 16, 2026, extended its law to business-to-business subscriptions, and ROSCA applies to any online negative option regardless of who the buyer is. Treat B2B subscriptions as covered.

Can I Still Offer a Discount When Someone Tries to Cancel?

Yes, everywhere except Minnesota (where the customer must opt in to hearing an offer) and Connecticut (where you must first say they can cancel at any time). The offer must be declinable in one click and cancellation must complete immediately on decline.

For years, the cancellation page was the part of a subscription product nobody owned. Marketing built the signup flow, engineering built the billing, and cancellation was whatever the payment provider shipped by default. That page now carries statutory requirements in a dozen states, a federal enforcement theory with billion-dollar precedents, and, eventually, a rebuilt federal rule that will look very much like the one that was vacated.

Treat it that way. Own it, measure it, and build it once to the strictest standard so you stop re-engineering it every legislative session. Done properly, it also becomes the best source of churn data you have, because every customer who leaves tells you why on the way out.

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