New Jersey to Regulate Auto-renewing Subscriptions

New Jersey will be regulating automatically-renewing subscription services, according to a report from Perkins Coie, following several other states.

The lawsuits come in response to the rapidly expanding subscription economy, which saw massive expansions over the pandemic. Over two-thirds of Americans now make use of a subscription service for every day goods. The value of the industry is purported to be at $1.5 trillion by 2025.

The New Jersey law is set to take effect on Aug. 1, 2023. It will apply to consumer service providers who offer New Jersey consumers at least a one-year term. The law is limited to contracts related to the maintenance, repair or servicing of property for now.

The law will come with several speculations — covered businesses will have to acknowledge cancellation requests within five business days and process them within 10 business days. And consumers will have to be offered either an online method, a mailing address or a telephone number for people to use to cancel.

In addition, the reminder notices sent to consumers before renewals will have to come with information on how a consumer can get the subscription cancelled.

The law follows similar ones passed recently in Idaho, Tennessee and Virginia.

The developments around subscription services have also seen many consumers working with ways of getting around paying for them.

Read more: 60% of Subscribers Admit to Gaming the System

PYMNTS wrote that the developments come as companies are offering subscription services for everything from entertainment to delivering foods, cosmetics, daily goods and more.

The research done by PYMNTS and sticky.io for “The Subscription Commerce Conversion Index: The Challenge Of Cheaters,” shows that 60% of respondents have said they “game the system” occasionally, especially amid the economic strife going on for months now.

The ways they’re doing it include cycling through various email addresses to using discount codes, along with other things such as buying discounted items in bulk and reselling them, disputing expenses for items they did actually receive and other things.