New York City to Mandate 'Click to Cancel' for Subscriptions, Ban Hidden Fees

New York City will require businesses to offer a simple "Click to Cancel" option for subscriptions and to disclose all "junk fees" upfront, according to a new policy announced by city officials. The rules, which aim to eliminate so-called "subscription traps," are set to take effect on October 1.

New Consumer Protection Rules

The policy, detailed in a statement from the offices of Mayor Zohran Mamdani and Department of Consumer and Worker Protection (DCWP) Commissioner Samuel Levine, introduces two main regulations. The first is a "Click to Cancel" rule that applies to all automatic renewal and continuous service subscriptions.

Under this rule, businesses must clearly disclose subscription terms and provide a cancellation process that is straightforward and transparent. A second rule targets "junk fees" by requiring businesses to advertise the full price of goods and services from the outset, including all mandatory charges.

Financial Impact and Penalties

City officials emphasized the financial burden of opaque pricing, citing consumer reports that estimate hidden fees cost an average family of four approximately $3,200 each year. The new policy is designed to provide consumers with greater price transparency and control over their recurring expenses.

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Businesses that fail to comply with the new regulations will face significant consequences. According to the city's statement, penalties will include providing restitution to consumers and paying civil fines that begin at $525 per violation.

National and Local Context

Officials described the policy as the first of its kind for a municipal government in the U.S. The city-level action follows a setback for similar consumer protections at the federal level, where a national "Click to Cancel" rule proposed by the Biden administration was struck down by a federal appeals court last year before it could be implemented.

The new rules align with Mayor Mamdani's campaign promises to make New York City more affordable for its residents.