New York City has implemented a new “click-to-cancel” rule, empowering consumers to easily terminate automatically renewing subscriptions. This move aligns with similar state-level efforts and comes as federal regulators, like the FTC, reconsider a nationwide standard to protect consumers from difficult cancellation processes.
New York City is stepping up to tackle the pervasive issue of hard-to-cancel subscriptions, enacting its own "click-to-cancel" rule. This measure, which took effect recently, aims to empower consumers, making the termination of automatically renewing services as simple as signing up. While New York State already has regulations in place requiring an easy cancellation method, the city's new authority allows for local enforcement and offers a dedicated portal for consumer complaints via nyc.gov.
As Mayor Zohran Mamdani succinctly put it, "If a company can take your money with one click, you should be able to get your money back with one click."
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New York City is reportedly the first municipality to implement such a "click-to-cancel" directive, joining a rising tide of states that have either adopted or strengthened laws governing automatic subscription renewals. This localized action comes amidst an ongoing federal debate about establishing a national standard for these practices.
Gonzalo Mon, a partner at Kelley Drye & Warren, highlights the growing focus on this issue: "Automatic renewals have been a pain point for consumers, and this is a popular topic with regulators, especially now given the increased focus on affordability, so I expect we'll continue to see more of these laws on the state level."
Complaints About 'Negative Option' Subscriptions Grow
So-called "negative option" subscription contracts—which automatically renew unless actively canceled by the consumer—are a significant source of consumer frustration and have led to a surge in complaints. While convenient to sign up for, these services often make cancellation an arduous process.
Data reveals the financial toll: U.S. adults annually spend an average of $1,080 on subscriptions, with millennials leading at $1,215, according to a 2025 CNET survey. A significant portion, approximately $205 per person annually, goes towards subscriptions they no longer use.
The Federal Trade Commission (FTC) recorded an average of nearly 70 daily consumer complaints about difficult-to-cancel subscriptions in 2024, a notable increase from 42 per day in 2021, according to the agency.
Intriguingly, artificial intelligence might offer a new solution. Meta's AI agent, Muse, for example, claims it can cancel subscriptions on behalf of users.
Across the nation, over half of states now have rules addressing automatic renewals. While specific provisions may vary, these laws generally focus on clear upfront disclosure of terms, mandatory consumer consent and confirmation, and, crucially, an accessible cancellation method. Some even mandate renewal reminders.
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What's Going On At The Federal Level
The push for a federal standard has faced hurdles. In October 2024, the Biden administration's FTC finalized a national "click-to-cancel" rule. However, this initiative was met with swift legal challenges from business and trade organizations, including the U.S. Chamber of Commerce.
Just a week before its scheduled implementation in mid-July 2025, the 8th Circuit Court of Appeals invalidated the rule on procedural grounds.
Despite this setback, the FTC seems poised for another attempt. A March 13 notice this year sought public feedback on updating its long-standing Negative Options Rule, specifically considering provisions from the vacated "click-to-cancel" rule. The comment period concluded on April 13.
"It's likely that the FTC will move forward, but we don't know how or when."
Gonzalo Mon
Partner with Kelley Drye & Warren
In the interim, the FTC continues to leverage existing federal consumer-protection laws to target companies engaged in deceptive subscription practices. A recent example includes a $35 million settlement in May with Shutterstock, addressing allegations that included making subscription cancellations unduly difficult.
On the legislative front, several bills are currently before Congress aiming to authorize "click-to-cancel" provisions. Among them is the bipartisan and bicameral Unsubscribe Act, which seeks to mandate easy cancellations and require consumer approval for charges after free or discounted trial periods.
