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The Federal Trade Commission (FTC) announced it will hold a virtual informal hearing on January 16, 2024, at 10 am ET on proposed amendments to the Negative Option Rule. During the hearing, six organizations that requested to present their positions orally will testify on issues raised during the rulemaking process. Out of more than 1,100 commenters, the six entities that requested to present their positions include: the International Franchise Association, TechFreedom, Performance Driven Marketing Institute, NCTA – the Internet & Television Association, FrontDoor and the Interactive Advertising Bureau (IAB). The FTC announced the proposed rulemaking on March 23 regarding changes to automatic renewal provisions for companies offering subscriptions and recurring payments. The Alliance submitted comments on June 23 reiterating that negative option subscription plans are already heavily regulated both at the Federal and state level and that the FTC has adequate existing authority to act in this area. The Alliance also recommended that the FTC only enact regulations that are consistent with existing best practices and established state laws. We will keep you apprised of this issue.

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The News/Media Alliance submitted comments on June 23 on the Federal Trade Commission’s Proposed Amendments to the Negative Option Rule, which was published in the Federal Register on April 24. The Alliance reiterated its position that negative option subscription plans are already heavily regulated both at the Federal and state level and that the FTC has adequate authority already to act in this area. If the FTC chooses to move forward, The Alliance recommended that the FTC only enact regulations that are consistent with existing best practices and established state laws. The comments state that our members and customers rely on automatic renewal programs to ensure uninterrupted service, convenience, and cost savings. The FTC argues the proposed Rule is needed due to widespread deceptive practices; however, given the dramatic expansion of subscription-based services, there is no evidence that complaints have risen proportionally. Expanding the rule as proposed is unnecessary and will impose an additional and inconsistent regulatory layer that will disrupt effective standardized practices businesses have put into place to comply with state laws.

The post The Alliance Submits Comments on FTC Automatic Renewal Proposal appeared first on News/Media Alliance.

On March 23, The Federal Trade Commission (FTC) announced a Notice of Proposed Rulemaking regarding changes to automatic renewal provisions for companies offering subscriptions and recurring payments. A “click to cancel” provision is one of several updates being proposed as part of the FTC’s ongoing review of its 1973 Negative Option Rule, which traditionally covered “book of the month” type offers. Other proposed changes include new requirements before making what are commonly referred to as “save the sale” offers during cancellation, as well as regarding reminders and confirmations. Companies that violate the updates would be subject to civil penalties from the FTC. Once the notice has been published in the Federal Register, there will be a sixty-day comment period.

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