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FTC Investigates Uber for Alleged Subscription Violations

By  |  November 28, 2024

The Federal Trade Commission (FTC) is reportedly probing Uber Technologies Inc. for potential violations of consumer protection laws, particularly concerning its Uber One subscription service. The investigation, which began earlier this year, centers on allegations that the company may have enrolled customers in the service without their explicit consent and made it challenging for users to cancel their subscriptions, according to a report by The Financial Times.

Uber has pushed back against these claims, emphasizing its compliance with legal standards. In a statement to The Financial Times, the company asserted that its cancellation process is designed to be straightforward, claiming that customers can terminate their subscriptions in “20 seconds or less.”

This investigation aligns with a broader push by the FTC to enhance consumer rights in the realm of subscription-based services. As per The Financial Times, the agency recently finalized its “click-to-cancel” rule in October. The new regulation aims to simplify the cancellation process for consumers across various industries, including streaming platforms and fitness memberships. However, the rule is already facing legal challenges, indicating that its implementation may not proceed without obstacles.

Read more: Taiwan’s Ministry of Labor Opposes Uber Eats-Foodpanda Merger

In an unrelated historical footnote reported by Bloomberg, Uber’s legal battles with the FTC date back to the period following the 2016 U.S. presidential election. At that time, the agency reportedly sought a settlement from the ride-hailing giant, which Uber’s legal team described as involving a substantial monetary sum.

This latest inquiry underscores the FTC’s intensified scrutiny of subscription services, particularly those accused of employing potentially deceptive practices to lock in customers. As the investigation unfolds, the outcome could have implications not only for Uber but for the broader subscription-based economy.

Source: The Financial Times