New York City has taken a significant step in protecting its consumers by banning deceptive subscription practices [1]. The new rule, which will start on October 1, requires companies to offer simple cancellation options or face fines of $525 per user subscription [2]. This move is expected to save New Yorkers alone as much as $162.5m per year, according to estimates by the Roosevelt Institute thinktank [3]. The city is also targeting so-called “junk fees” with a proposed rule that requires sellers to “advertise the total price for any good or service, including all mandatory additional charges and fees, up front” [4].

Companies that do not comply with the new rule will face aggressive enforcement, including hefty fines and potential lawsuits [5]. The ban on deceptive subscriptions is part of a broader effort by the city to address the affordability crisis and make the city cheaper for residents [6]. The move has been welcomed by consumer protection groups, who argue that deceptive subscriptions have been a major problem for consumers [7]. However, industry groups have pushed back against the rule, arguing that it will stifle innovation and increase costs for businesses [8].

The city will take public comments on the junk fee rule and then hold a hearing, with the goal of implementing the rule by the end of the year [9].

Sources

  1. The Guardian - New York City to become first in US to ban deceptive subscription practices
  2. Glenbrook Partners, LLC - New York City to Become First in US to Ban Deceptive Subscription Practices
  3. Roosevelt Institute - Letter to New York City Department of Consumer and Worker Protection regarding proposed click-to-cancel rule
  4. The Guardian - New York City to become first in US to ban deceptive subscription practices
  5. Slashdot - NYC To Become First In US To Ban Deceptive Subscription Practices
  6. The Guardian - New York City to become first in US to ban deceptive subscription practices
  7. LinkedIn - New York City becomes first in the US to ban deceptive subscription practices
  8. Reddit - New York City to become first in US to ban deceptive subscription practices
  9. The Guardian - New York City to become first in US to ban deceptive subscription practices