Sponsors (4)
The bill substantially strengthens consumer protections against unwanted recurring charges and clarifies standards for cancellation and consent, but it raises compliance costs and legal uncertainties that may lead businesses to reduce automatic-renewal offers, shift costs to consumers, and create state and administrative frictions.
Consumers will be less likely to be unknowingly charged and will have clearer control of subscriptions because merchants must obtain express informed consent, give clear written notice of material negative-option terms, provide reminders for free-to-pay conversions, and offer an easy cancellation mechanism while prohibiting manipulative UI patterns.
The Federal Trade Commission can use its full enforcement powers and will follow APA rulemaking (notice-and-comment), strengthening federal ability to stop violators and providing a public rulemaking process for implementing standards.
State governments keep the ability to enforce state laws and may maintain stronger consumer protections or sue on behalf of residents, preserving state-level remedies and regulatory autonomy where not in direct conflict with the federal Act.
Small businesses and merchants will face increased compliance costs (consent verification, multi-year recordkeeping, notification systems and changes to purchase flows) that may be passed on to consumers as higher prices.
Some businesses may discontinue automatic renewals, free-to-pay promotions, or discounted introductory/continuity plans rather than overhaul systems, reducing convenient and low-cost offers for consumers.
Federal enforcement could preclude or delay parallel state actions, potentially slowing or limiting state-led remedies while federal cases proceed.
Based on analysis of 6 sections of legislative text.
Prohibits negative‑option charges unless merchants provide clear disclosures, obtain express informed consent, keep consent records, offer easy cancellations, and send periodic notices.
Official title: To increase consumer protection with respect to negative options in all media, including on the internet, and for other purposes.
Introduced January 13, 2026 by Mark Takano · Last progress January 13, 2026
Makes it illegal for a merchant to charge a consumer through a "negative option" (automatic renewals, free-to-pay conversions, continuity plans) unless the merchant gives clear, conspicuous, pre‑transaction disclosure of all material terms, obtains the consumer's express informed consent, retains proof of that consent for at least three years, provides an easy cancellation mechanism, sends required notices (including annual and pre‑renewal notices), and follows timing limits on automatic renewals; the FTC enforces violations using its existing authorities. The law applies only to contracts entered into or amended more than one year after the law is enacted and preserves state consumer protections except where they conflict with specified federal requirements.