The Federal Trade Commission has delayed enforcement of its controversial “Click-to-Cancel” rule until July 2025, giving businesses extra time while legal battles continue to challenge the regulation’s legitimacy.
At a Glance
- FTC has pushed back the “Click-to-Cancel” rule enforcement to July 14, 2025, extending the deadline by 60 days
- The rule requires subscription cancellation processes to be as simple as sign-up procedures
- Multiple industry groups have filed lawsuits challenging the FTC’s authority to implement the rule
- Noncompliance could result in civil penalties up to $53,088 per violation once enforcement begins
- Trump’s recent firing of two Democratic FTC commissioners has created uncertainty about the rule’s future
Extended Compliance Timeline Creates Uncertainty
The Federal Trade Commission has announced a further delay in enforcing its “Click-to-Cancel” rule, part of amendments to the broader Negative Option Rule. The Commission unanimously voted to push the enforcement date to July 14, 2025, moving it back from the previous May deadline. This marks another extension after some provisions originally took effect in January 2025, with the FTC citing the need for additional time after reassessing implementation challenges faced by businesses.
“The Commission conducted a fresh assessment of the burdens that forcing compliance by this date would impose,” the FTC stated in its announcement, explaining the reasoning behind the latest delay.
What The Rule Requires From Businesses
The “Click-to-Cancel” rule imposes specific requirements on companies that offer subscription services. Under the rule, businesses must make cancellation processes just as simple and straightforward as the sign-up process. Companies cannot force customers to speak with representatives to cancel unless that was the original sign-up method. The rule also mandates clear disclosure of cancellation terms before collecting payment information from consumers.
“Many companies need to ensure that malicious actors are not wrongfully cancelling a security, fire, medical, or other sensitive service,” argued the U.S. Chamber of Commerce. “But if the service allowed a customer to sign up by an email contract or similar online mechanism, then the Rule would restrict the company in having a representative speak with the customer to verify the customer’s identity.”
Legal Challenges Mount As Implementation Looms
The regulation faces significant legal opposition from industry groups, including telecom companies and the U.S. Chamber of Commerce. Multiple lawsuits challenging the rule have been consolidated in the Eighth Circuit Court of Appeals. These legal challenges argue that the FTC has overstepped its authority by implementing a one-size-fits-all approach that could potentially override more specific existing laws and industry practices.
“Of course, if that enforcement experience exposes problems with the Rule, the Commission is open to amending the Rule to address any such problems,” the FTC stated, indicating some flexibility in its approach despite standing firm on eventual implementation.
Political Dimensions Add Further Complexity
The rule was originally championed by former FTC Chair Lina Khan, a Democrat appointed during the Biden administration, as part of a broader initiative against what the administration termed “junk fees.” The regulation was initially approved by a 3-2 vote along party lines, highlighting its political nature. With President Trump having recently fired two Democratic commissioners from the FTC, questions remain about whether the newly constituted Commission will continue to support the rule as written.
When enforcement begins in July 2025, companies found in violation could face substantial financial penalties, with each violation potentially resulting in fines up to $53,088. The Commission has stated that after the July enforcement date, “regulated entities must be in compliance with the whole of the Rule because the Commission will begin enforcing it,” though they remain open to future amendments based on implementation experiences.