The Federal Trade Commission’s “click-to-cancel” rule got canceled by the Eighth Circuit Court of Appeals in July. But reports of its death may have been premature.
According to Holly Melton, an attorney with Frankfurt Kurnit Klein + Selz, the recent settlement in the FTC’s lawsuit against Amazon over the online retailer’s tactics to enlist customers in Prime, could point to a plan by the agency to revive the rule via a new proceeding.
“Buried in paragraph VI [of the settlement agreement], under “Negative Option Rule,” was this line: ‘To the extent the Commission promulgates an amended rule or regulation governing negative options or subscriptions, the requirements of that rule will supersede the corresponding provisions of this order,’” Melton wrote in a blog post.
“That’s not boilerplate,” she added. “It reads like a deliberate placeholder—future-proofing the settlement for the reappearance of Click to Cancel. The clause all but acknowledges the Commission expects, or at least hopes, to revive the rule in some form.”
The FTC approved the click-to-cancel rule in October 2024. It would have required firms offering subscription services to obtain consent for negative option features separately from other aspects of a transaction obtained through a checkbox or other affirmative act. It also required a simple “click-to-cancel” mechanism for all online subscriptions.
The rule was slated to go into effect on July 1, 2025. Before that happened, however, a district court and then the Eighth Circuit vacated the rule over procedural errors in approving it.
The FTC rule carried echoes of the Restore Online Shoppers’ Confidence Act (ROSCA) passed by Congress in 2019, which mandated disclosures, consent and simple cancellation methods for online transactions. The law applied only to transactions “completed online,” leaving recurring-charge programs like Amazon Prime beyond its scope. The FTC’s rule was intended to close that loophole.
Despite the Eighth Circuit’s vacating of the FTC rule, ROSCA remains in force. The FTC sued Amazon under law, charging it with using “sophisticated subscription traps designed to manipulate consumers into enrolling in Prime and then made it exceedingly hard for consumers to end their subscription.” As part of the settlement agreement in that case, Amazon paid a $2.5 billion fine and was required to add a prominent button for consumers to decline Prime and add additional disclosures regarding the full terms and conditions of a transaction.
Some states, including most recently Massachusetts and California, have passed their own laws requiring simple cancellation methods for online subscriptions.
The language in the agreement alluding to a possible re-emergence of the click-to-cancel rule is of a piece with the FTC’s recent focus on so-called kitchen-table issues affecting consumers, Melton noted. She pointed to comments by Commissioner Mark Meador’s comments at the agency’s National Advertising Division annual meeting in September the regarding the agency prioritizing “everyday economic concerns affecting ordinary households.” He also expressed disappointment over click-to-cancel being vacated and said the agency is actively considering whether to revisit the rulemaking.
Even if the Commission doesn’t immediately take steps to reissue the vacated rule, its litigation posture and enforcement strategy suggest that subscription practices will remain a top-tier priority for the Bureau of Consumer Protection,” Melton wrote. “For advertisers and subscription-based businesses, the path forward is clear: provide transparent disclosures, obtain affirmative consent, and make cancellation as effortless as sign-up. The ‘Click to Cancel’ may be down, but it’s not out – and the FTC appears to be keeping its options open.”
