(NewsNation) — The “click to cancel” rule floated by the Federal Trade Commission has been rejected by the United States Court of Appeals for the Eighth Circuit.
The proposed rule would have allowed consumers to cancel subscriptions as easily as signing up, but it was rejected because the FTC failed to follow through on the requisite procedures.
Companies would have been required to allow consumers to cancel their subscriptions in the same way they signed up.
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“While we certainly do not endorse the use of unfair and deceptive practices in negative option marketing, the procedural deficiencies of the Commission’s rulemaking process are fatal here,” the court wrote in its ruling.
In 2023, a public notice gained 16,000 comments from consumers, agencies at the state and local level and trade groups, leading to the design of the rule.
The FTC says it received 70 complaints per day from consumers regarding difficult or unwanted processes to cancel memberships or subscriptions.
The rule was set to take effect within days; however, the failure to produce a preliminary regulatory analysis led to the vacating of the rule.
