New York City's click-to-cancel rule is now in force, and the federal rule is still dead. A compliance map for any business that sells subscriptions

Since October 1, anyone in New York City who signed up for a subscription with a click has had the right to cancel it the same way. The city's Department of Consumer and Worker Protection adopted the rule on July 10, and it is the first rule of its kind written by a U.S. city, according to the City of New York. "If you can sign up with a click, you must be able to cancel with one," Mayor Zohran Mamdani said.

The rule covers automatically renewing and continuous-service subscriptions offered to New York City consumers. TechSpot listed streaming services, gym memberships, subscription boxes and free trials that convert to paid plans among the arrangements affected. The city estimates the rule will save consumers $21.5 million to $162.5 million a year.

For businesses, the bigger story is the patchwork. There is no national click-to-cancel rule in force, so a company selling subscriptions across the country now has to satisfy a growing list of city and state requirements at once.

What does the New York City rule require?

The requirements below are drawn from the city's summary and an analysis by the law firm Skadden.

• Disclose before you ask for payment. Before requesting consent or billing information, a business must clearly disclose the amount and frequency of charges, the deadline to cancel and the ways to cancel. For free trials and introductory prices, it must explain how and when the price will change.
• Cancel the way you joined. Canceling must be as simple as enrolling and available through the same avenues. If a customer signed up in person, the business must also offer an online way to cancel, such as a website or email.
• No obstruction. Businesses may not hide cancellation instructions, impose unreasonable conditions, hang up on customers, ignore cancellation requests or unreasonably delay processing them.
• No return-shipping charges for free items. A business cannot make customers pay to ship back items that were sent for free, the city says.
• Send reminders on a schedule. The rule sets notice windows, described below.

Source: Skadden summary of the NYC Department of Consumer and Worker Protection rule.

Penalties and exemptions

Civil penalties are $525 for a first violation, $1,050 for a second and $3,500 for subsequent violations, according to TechSpot. Skadden notes that each deceptive statement or omission can count as a separate violation, and that the city can seek restitution of amounts charged after a consumer's first attempt to cancel. Banks and credit unions, entities regulated by the New York Department of Financial Services, licensed security alarm operators and sellers of certain service contracts are exempt.

The city rule largely tracks New York State's amended automatic renewal law but goes further in places, including the online cancellation requirement for in-person sign-ups. Skadden's advice is blunt: compliance with state law alone "should not be considered sufficient." Consumers can file complaints through the city's website, by mail or by fax, and the department may assign a mediator.

What happened to the federal click-to-cancel rule?

The Federal Trade Commission finalized a nationwide negative option rule, widely called click-to-cancel, in October 2024. It never took effect. The FTC delayed enforcement in May 2025, and about two months later a federal appeals court vacated the rule because the agency had not completed a required preliminary economic analysis, TechSpot reported. The FTC reopened rulemaking in March 2026, with comments closing April 13, but it has not announced a replacement rule.

Federal enforcement has not stopped. In September 2025, Amazon agreed to pay $2.5 billion to settle FTC allegations that it enrolled customers in Prime without clear consent and made canceling too hard, including a $1 billion civil penalty, the largest in FTC history, and $1.5 billion in refunds, the Associated Press reported. The case was brought under the Restore Online Shoppers' Confidence Act, a 2010 law. Amazon admitted no wrongdoing and said it had already simplified its cancellation process.

The state patchwork

About 30 states now have some form of automatic renewal or click-to-cancel law, according to Skadden, and laws or amendments took effect in 2026 in Colorado, Connecticut, Maine, Maryland and Virginia. Two examples show how requirements differ:

• California. Amendments under Assembly Bill 2863 took effect July 1, 2025. They require express affirmative consent to renewal terms, an annual reminder that states how often the subscription renews, what it costs and how to cancel, cancellation through the same channel used to sign up, and retention of proof of consent for at least three years or one year after the contract ends, whichever is longer, according to the law firm Barnes & Thornburg.
• Florida. Requires notice 30 to 60 days before the cancellation deadline for certain renewals, Skadden noted, a different window from New York City's.

Because the windows and triggers vary, one practical approach is to design a single flow that meets the strictest combination of rules a business is subject to, rather than maintaining a different flow for each place a customer lives.

A checklist for subscription businesses

1. Map your subscribers by location. Know how many customers you have in New York City, California and other states with renewal laws.
2. Audit the sign-up page. Price, billing frequency, cancellation deadline and how to cancel should appear before the customer enters payment details, not in a linked terms page.
3. Build a self-serve cancel button. If sign-up happens online, cancellation should too. If you sell in person, add an online or email option.
4. Keep save offers short. New York City bars unreasonable conditions and delays, so a retention offer should never stand between the customer and the cancel button. Confirm cancellations immediately and in writing.
5. Automate reminders for renewals, price changes and trial conversions, using windows that satisfy every jurisdiction you serve.
6. Keep records of consent and cancellation requests for at least three years.
7. Get legal review of your flows. This article summarizes published analyses and is not legal advice.

These rules are not only a concern for streaming giants. The arrangements named in coverage of New York City's rule include gym memberships, subscription boxes and free trials, which describes plenty of local businesses that bill monthly.