Staying Ahead Of Enforcement: Practical Compliance With Automatic Renewal Laws

Automatic renewals, more commonly referred to as subscription services, have become a household topic (or maybe just in ours?) of advertising law enforcement. Subscription services – from streaming platforms to meal kits – offer undeniable convenience, but that ease comes with legal complexity and scrutiny, both at the federal and state levels.

At the recent ANA Masters of Advertising Law conference, then-FTC Commissioner Melissa Holyoak (who was just appointed the interim U.S. attorney for the District of Utah) highlighted in our very own Amy Mudge and Daniel Kaufman's mainstage presentation that she believes ROSCA will continue to be an FTC enforcement priority. We also heard about automatic renewal enforcement priorities from the Massachusetts Attorney General's Office (which now has one of the strictest new Automatic Renewal laws that went into effect in Sept. 2025). As we close out 2025, businesses and legal practitioners must stay alert to the rapidly shifting regulatory environment, including new laws, as subscriptions continue to be an enforcement priority.

ROSCA Remains the Primary Federal Enforcement Tool

Let's start with the basics. At the federal level, the Restore Online Shoppers' Confidence Act (ROSCA) is the primary statute governing automatic renewals and remains the FTC's most effective tool for securing consumer redress and/or civil penalties in these types of enforcement actions. ROSCA requires clear and conspicuous disclosure of material terms prior to obtaining the consumer's billing information, express informed consent and a "simple mechanism" of cancellation. The FTC has brought approximately 50 ROSCA actions since it was signed into law in 2010 and continues to be active in enforcing these requirements, even after the Eighth Circuit vacated the FTC's expanded Negative Option Rule in July (more about that here). In fact, the largest ROSCA settlement to date, $2.5 billion, was announced this fall.

State Law Trends: A Patchwork of Requirements

States are rapidly enacting and amending automatic renewal laws (ARLs), frequently imposing requirements that surpass federal standards. With this, it's no surprise that state attorneys general have ramped up enforcement. Recent actions include allegations ranging from insufficient disclosures to difficult cancellation processes.

Eric Carnevale, assistant attorney general for Massachusetts, outlined his view of the state's enforcement priorities during an ANA panel. While unable to comment on specific cases or investigations, Carnevale emphasized that Massachusetts' primary objective in enacting these regulations is to address consumer pain points identified through complaints and issues brought directly by consumers to the Attorney General's Office. Addressing the impact of the Eighth Circuit's decision to vacate the FTC's Negative Option Rule, Carnevale affirmed: "Whether the FTC's Negative Option Rule is in effect or not, ours is. And it will stay that way for the foreseeable future."

Most state ARLs share several core elements, including:

• Affirmative consent: This is generally required to be in close proximity to clear and conspicuous disclosure of material terms.
• Post-sale acknowledgments: Businesses must send an email after purchase that includes information such as the date by which the consumer must cancel to avoid future charges.
• Reminder notifications before renewal: Many states prescribe a specific (and unique) window for sending renewal notification reminders.
• Easy cancellation mechanisms: Some states require that the cancellation be available in the same method in which the consumer signed up.
• Notice of material changes: Some states require notice if a price changes.
• Free trials: These are generally required to advise the consumer of the price once the trial ends, among other requirements.

While most state ARLs share common core elements, each state's unique provisions demand close attention, as compliance obligations can differ significantly across jurisdictions.

What's New for 2025-2026? Key Legal Updates

This evolving patchwork creates significant compliance challenges for businesses operating across multiple states. To help with these compliance efforts, below are highlights from states that have enacted or amended their ARLs effective in late 2025 and 2026.

• California: Stronger affirmative consent requirements and reminder emails for all annual subscriptions required (effective July 2025)
• Colorado: Extends law to B2B subscriptions and requires "one-step online cancellation" (effective February 2026)
• Connecticut: Annual renewal reminder notice requirement (effective July 2026)
• Maine: Amended law to include health memberships and strengthened disclosure and consent mechanism requirements; violators may now be required to provide the consumer with a refund or credit three times the unauthorized amount billed or paid (applies to subscriptions entered into on or after Jan. 1, 2026)
• Maryland: New law requires, among other things, clear and conspicuous disclosure of material terms, imposes reminder notice requirements and requires same-medium cancellation (effective June 2026)
• Massachusetts: ARL regulations mandate clear disclosures, reminder notices and same-medium cancellation requirements (effective September 2025)
• New York: Enhanced free trial and price change notice requirements (effective November 2025)

Practical Compliance Tips

• Audit your renewal reminder notifications: Are you meeting the state requirements, which vary based on subscription length and when they must be sent?
• Review your consent mechanism language.
• Evaluate whether your cancellation options meet the more stringent state requirements of "easy to use" or, in the case of California and Colorado, are "one-click."
• Monitor enforcement actions and the state legal landscape.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.