Unsubscribe Act of 2025

This bill increases consumer protections for negative option contracts (where a consumer's silence or failure to cancel is treated as acceptance) across all media, including online. It requires clear disclosure, express informed consent, limits on automatic renewals, simple cancellation mechanisms, and specific rules for free-to-pay conversion contracts. The Federal Trade Commission (FTC) and state attorneys general can enforce the law, and it preempts only directly conflicting state laws while allowing stronger state protections. The bill takes effect one year after enactment for new or amended contracts.

Sec. 2, Increased consumer protection with respect to negative options: This section makes it unlawful for a merchant to charge a consumer through a negative option unless the merchant clearly discloses all material terms before payment, obtains the consumer's express informed consent (an affirmative action like clicking a button, not silence or pre-checked boxes), and keeps proof of consent for at least three years. After a preliminary period, automatic renewals cannot exceed the length of that period unless the merchant gets new express informed consent. For online contracts, merchants must provide a simple electronic cancellation mechanism, like a direct link to a form. For offline contracts, cancellation must be available in the same manner the contract was made. Free-to-pay conversion contracts require pre-transaction notification of terms (introductory and recurring costs) and a reminder before the first post-introductory charge. Merchants must also send annual notifications of terms and cancellation access, and a reminder 2-7 days before the last cancellation window closes.

Sec. 3, Enforcement: Violations are treated as unfair or deceptive acts under the FTC Act, and the FTC can enforce the law with its usual powers, including rulemaking. State attorneys general can sue on behalf of residents in federal court, but must notify the FTC first (or immediately if not feasible). The FTC can intervene in state cases, and states cannot sue while a federal action is pending against the same defendant for the same violation. This does not limit state investigative powers.

Sec. 4, Preemption of directly conflicting state laws: This Act does not preempt state laws unless they directly conflict, and only to the extent of the conflict. State laws providing greater consumer protection are not considered conflicting. Differences in time frames for compliance are considered conflicts.

Sec. 5, Definitions: Key terms are defined, including automatic renewal contract, continuity plan contract, express informed consent (affirmative action separate from initial consent, excluding silence or pre-checked boxes), free-to-pay conversion contract, introductory period, merchant of record, negative option, negative option contract (including automatic renewal, continuity plan, free-to-pay conversion, and pre-notification plans), notification (written and clear), preliminary period, pre-notification negative option plan contract, and simple mechanism (as defined in FTC regulations).

Sec. 6, Effective date: The Act applies to contracts entered into or amended one year after enactment.