The Federal Trade Commission has finalized its “Click-to-Cancel” rule in an effort to make it easier for consumers to end subscriptions.

As subscriptions have taken over countless industries, companies have engaged in a plethora of practices aimed at making it almost impossible for consumers to easily cancel. The FTC has been working to address the problem, developing a rule to govern the practice.

“Too often, businesses make people jump through endless hoops just to cancel a subscription,” said Commission Chair Lina M. Khan. “The FTC’s rule will end these tricks and traps, saving Americans time and money. Nobody should be stuck paying for a service they no longer want.”

The agency is particularly focused on “negative option marketing.” In 2009 report, the FTC defined its use of the term.

The FTC uses the phrase “negative option marketing” broadly to refer to a category of commercial transactions in which sellers interpret a customer’s failure to take an affirmative action, either to reject an offer or cancel an agreement, as assent to be charged for goods or services. Negative option marketing can pose serious financial risks to consumers if appropriate disclosures are not made and consumers are billed for goods or services without their consent. With the explosion of Internet marketing over the past ten years, negative option offers are as much a fixture of online advertising as in any other advertising media. The workshop focused particularly on Internet-based negative option offers, because they are relatively new and present distinct issues regarding the form, content, and timing of disclosures.

The new rule will apply to virtually all negative option programs.

The Commission’s updated rule will apply to almost all negative option programs in any media. The rule also will prohibit sellers from misrepresenting any material facts while using negative option marketing; require sellers to provide important information before obtaining consumers’ billing information and charging them; and require sellers to get consumers’ informed consent to the negative option features before charging them.

The agency says the new rule will prohibit sellers from the following:

• misrepresenting any material fact made while marketing goods or services with a negative option feature;
• failing to clearly and conspicuously disclose material terms prior to obtaining a consumer’s billing information in connection with a negative option feature;
• failing to obtain a consumer’s express informed consent to the negative option feature before charging the consumer; and
• failing to provide a simple mechanism to cancel the negative option feature and immediately halt charges.

The agency’s new rules should go a long way toward improving the consumer experience, making it easy to cancel unwanted subscriptions.