Federal (FTC) subscription auto-renewal rules
Effective December 29, 2010. No amendments as of June 2026. · Last reviewed 2026-06-26
The statute
Restore Online Shoppers' Confidence Act (ROSCA), Pub. L. 111-345, 15 U.S.C. §§ 8401-8405
Effective December 29, 2010. No amendments as of June 2026.
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FTC Act, 15 U.S.C. § 45 (Section 5) — enforcement vehicle for ROSCA violations
Effective Operative; civil penalty amounts adjusted annually. Most recent operative adjustment: $53,088 per violation, effective January 17, 2025 (16 CFR § 1.98). The 2026 COLA increase was cancelled by OMB M-26-11 (April 2026), leaving the 2025 figure in effect.
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FTC Enforcement Policy Statement Regarding Negative Option Marketing (October 29, 2021 / Federal Register November 4, 2021)
Effective November 4, 2021. Non-binding policy statement; not a rule. Clarifies FTC Section 5 and ROSCA enforcement positions on disclosures, consent, and cancellation.
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FTC Negative Option Rule (Click-to-Cancel Rule), 16 CFR Part 425, 89 Fed. Reg. 90476 (Nov. 15, 2024) — VACATED
Effective Vacated by the U.S. Court of Appeals for the Eighth Circuit, July 8, 2025, on procedural grounds (failure to conduct preliminary regulatory analysis as required by FTC Act § 18). The rule never took operative effect.
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FTC Advance Notice of Proposed Rulemaking (ANPRM) on Negative Option Rule, 91 Fed. Reg. (Mar. 13, 2026)
Effective Published March 13, 2026; public comment period closed April 13, 2026. No final rule adopted as of June 2026.
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What it addresses
Each requirement below is stated in plain English first, then cited to the statute so you can read the primary source.
Disclosure before purchase
15 U.S.C. § 8403(1) makes it unlawful for any person to charge or attempt to charge any consumer for goods or services sold in an Internet transaction through a negative option feature unless the person provides text that clearly and conspicuously discloses all material terms of the transaction before obtaining the consumer's billing information. 'Negative option feature' is defined by reference to the FTC's Telemarketing Sales Rule, 16 CFR Part 310.
15 U.S.C. § 8403(1)Read the statute →
15 U.S.C. § 8402(a)(1) makes it unlawful for a post-transaction third party seller to charge or attempt to charge a consumer's financial account for any Internet-sold good or service unless, before obtaining the consumer's billing information, the post-transaction third party seller has clearly and conspicuously disclosed all material terms of the transaction, including: (A) a description of the goods or services offered; (B) the fact that the post-transaction third party seller is not affiliated with the initial merchant; and (C) the cost of such goods or services. This provision applies specifically to sellers who solicit purchases through another merchant after the consumer has initiated a separate transaction.
15 U.S.C. § 8402(a)(1)Read the statute →
Affirmative consent
15 U.S.C. § 8403(2) requires that, for any Internet negative option transaction, the seller obtain a consumer's express informed consent before charging the consumer's credit card, debit card, bank account, or other financial account. The FTC's 2021 Enforcement Policy Statement elaborates that consent obtained through deceptive means (e.g., burying terms, using pre-checked boxes, or obscuring the offer) does not satisfy this requirement.
15 U.S.C. § 8403(2)Read the statute →
15 U.S.C. § 8402(a)(2) requires that a post-transaction third party seller receive the consumer's express informed consent for a charge by: (A) obtaining from the consumer (i) the full account number of the account to be charged and (ii) the consumer's name, address, and a means to contact the consumer; and (B) requiring the consumer to perform an additional affirmative action, such as clicking a confirmation button or checking a box, indicating consent to be charged the disclosed amount. Reliance on billing information passed from the initial merchant does not satisfy this requirement.
15 U.S.C. § 8402(a)(2)Read the statute →
Acknowledgment / confirmation
15 U.S.C. § 8402(b) prohibits an initial merchant from disclosing a consumer's credit card, debit card, bank account, or other financial account number — or any other billing information used to charge the customer — to any post-transaction third party seller for use in an Internet-based sale of goods or services. This structural prohibition operates independently of whether disclosures or consent are otherwise provided.
15 U.S.C. § 8402(b)Read the statute →
Cancellation mechanism
15 U.S.C. § 8403(3) requires that any person charging for goods or services through an Internet negative option feature provide simple mechanisms for a consumer to stop recurring charges from being placed on the consumer's credit card, debit card, bank account, or other financial account. The statute does not specify a particular channel or medium for this mechanism; what constitutes 'simple' is informed by FTC enforcement practice. The FTC's 2021 Policy Statement indicates that practices that impede effective operation of promised cancellation procedures — such as hanging up on consumers, placing them on hold for unreasonable periods, or misrepresenting cancellation terms — are inconsistent with this requirement.
15 U.S.C. § 8403(3)Read the statute →
Penalties and enforcement
Violations of ROSCA or any regulation prescribed under it are treated as violations of an FTC Act rule under 15 U.S.C. § 57a (FTC Act § 18), subjecting violators to civil penalties under FTC Act §§ 5(l) and 5(m)(1)(A)/(B). The maximum civil penalty is $53,088 per violation (effective January 17, 2025 per 16 CFR § 1.98, as published in 90 Fed. Reg. 7958 (Jan. 17, 2025)). Each day a violation continues may constitute a separate violation. The 2026 annual COLA inflation adjustment was cancelled by OMB Memorandum M-26-11 (April 2026), leaving the 2025 figure operative as of June 2026. Sources: 15 U.S.C. § 8404; 16 CFR § 1.98 (https://www.law.cornell.edu/cfr/text/16/1.98); Wiley Law client alert (https://www.wiley.law/alert-Automatic-Renewals-and-Risks-State-Negative-Option-Legislation-and-Enforcement-is-Trending).
1. FTC v. Amazon.com, Inc. (ROSCA), W.D. Wash., settled September 25, 2025: Amazon agreed to pay $1 billion in civil penalties and $1.5 billion in consumer refunds ($2.5 billion total) to resolve FTC allegations that Amazon used dark patterns to enroll consumers in Prime memberships and impeded cancellation, in violation of ROSCA and FTC Act § 5. The district court's September 17, 2025 summary judgment ruling confirmed that ROSCA applies to Prime-style automatically renewing memberships and free-trial-to-paid conversions. Source: https://www.khlaw.com/insights/amazon-pay-record-25-billion-settle-ftc-claims-deceptive-prime-membership-signup-and; FTC case page: https://www.ftc.gov/legal-library/browse/cases-proceedings/2123050-amazoncom-inc-rosca-ftc-v (FTC.gov returned 403; case confirmed via secondary sources). 2. Multi-state coordination: 34 state Attorneys General announced coordinated settlements with TFG Holdings, Inc. over unlawful negative option enrollment practices. Source: https://www.wiley.law/alert-Automatic-Renewals-and-Risks-State-Negative-Option-Legislation-and-Enforcement-is-Trending. 3. California Automatic Renewal Task Force (CART): August 2025 — $7.5 million settlement with HelloFresh by LA and Santa Clara County DAs for misleading consumers into recurring subscription charges. Source: https://www.wiley.law/alert-Automatic-Renewals-and-Risks-State-Negative-Option-Legislation-and-Enforcement-is-Trending. 4. The FTC has publicly stated it will continue active ROSCA enforcement notwithstanding the vacatur of the Click-to-Cancel Rule. Source: https://www.gibsondunn.com/ftc-restarts-negative-option-rulemaking-after-eighth-circuit-vacatur-enforcement-under-rosca-continues/.
Caveats
1. CLICK-TO-CANCEL RULE VACATED: The FTC's Negative Option Rule (the 'Click-to-Cancel' rule), 16 CFR Part 425, was vacated by the Eighth Circuit on July 8, 2025 on procedural grounds and never took legal effect. Requirements that rule would have imposed — including same-medium cancellation, specific renewal reminder notices, and free-trial conversion notices codified in 16 CFR Part 425 — are NOT currently enforceable as federal rules. They are omitted from this dataset because they have no operative legal force as of June 2026. 2. ANPRM IN PROGRESS: The FTC published an ANPRM on March 13, 2026 seeking comment on whether to amend the existing Negative Option Rule. As of June 2026, no NPRM has been published and no new rule has been adopted. The ANPRM outcome is entirely uncertain. 3. PENALTY FIGURE UNCERTAINTY: The 2026 civil penalty amount is in flux. OMB M-26-11 (April 2026) cancelled the annual COLA adjustment for 2026, leaving the 2025 figure of $53,088 operative. Whether this cancellation will itself be challenged or reversed is uncertain. The $53,088 figure is confirmed by 16 CFR § 1.98 (as of January 17, 2025) and Wiley's 2026 client alert; the precise 2026 post-OMB-memo figure has not been confirmed in a verifiable FTC press release or Federal Register notice consulted directly (FTC.gov returned 403 errors during research). 4. ROSCA SCOPE LIMITS: ROSCA §8403 applies only to transactions 'effected on the Internet.' Offline negative option sales (mail, telephone, in-person) are governed by FTC Act § 5, the Telemarketing Sales Rule (16 CFR Part 310), and state law — not ROSCA directly. ROSCA §8402's post-transaction third-party seller provisions apply only to the specific scenario where a third party solicits purchases through a separate initial merchant's platform. 5. NO RENEWAL REMINDER, FREE TRIAL CONVERSION, OR PRICE CHANGE NOTICE REQUIREMENTS IN ROSCA: ROSCA §§ 8402-8403 do not expressly require advance renewal reminders, free-trial-to-paid conversion notices, or price change notices. These categories are addressed in many state auto-renewal laws but are not independently mandated by any currently operative federal statute or rule as of June 2026. They were included in the vacated Click-to-Cancel Rule but that rule has no legal force. The FTC's 2021 Policy Statement (non-binding) and general Section 5 authority could be invoked against deceptive practices in these areas, but there is no clear, operative, citable federal rule imposing specific pre-conversion or pre-renewal notice periods or content requirements. Accordingly, those requirement categories are omitted from this federal entry. 6. FTC 2021 POLICY STATEMENT: The October 2021 'Enforcement Policy Statement Regarding Negative Option Marketing' is a non-binding policy statement, not a rule. It describes FTC enforcement intentions under existing laws (Section 5, ROSCA, TSR) but does not itself create legally enforceable obligations distinct from those statutes. It is cited here for context only.
Last reviewed 2026-06-26
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