New York City announced a new municipal policy to prohibit firms from using subscription traps and to make subscription cancellation straightforward for consumers through a rule the city calls "Click to Cancel," city officials said.
The policy, released by the offices of Mayor Zohran Mamdani and Department of Consumer and Worker Protection Commissioner Samuel Levine, is described by city officials as the first municipal government rule of its kind in the United States.
Officials said the policy will target two practices: subscription traps, which can make it difficult for consumers to end recurring services, and so-called "junk" fees that are not included in advertised prices. The "Click to Cancel" requirement will apply to automatic renewal and continuous service subscriptions and mandates clear disclosure of subscription terms as well as an easy, transparent cancellation process.
The city indicated the "Click to Cancel" rule will take effect on October 1. The separate rule addressing "junk" fees requires businesses to present the full price of goods and services up front, incorporating any mandatory charges and fees into the advertised total.
City officials cited an estimate from consumer reports that hidden fees cost an average family of four about $3,200 per year. For businesses that do not comply with the new rules, the policy prescribes consumer restitution plus civil penalties starting at $525 per violation, city officials said.
Officials noted there had been a prior national "Click to Cancel" rule introduced during the administration of former President Joe Biden, but that it was struck down by a federal appeals court last year before its scheduled effective date.
Mayor Mamdani, who ran as a democratic socialist on a platform that included making the city more affordable, took office in January, city officials said.
Summary: New York City will ban subscription traps, require easy cancellation via a "Click to Cancel" rule effective October 1, and force upfront disclosure of all mandatory fees. Violations will trigger restitution and civil penalties starting at $525 per violation.