{"id":61561,"date":"2025-02-01T06:05:14","date_gmt":"2025-02-01T06:05:14","guid":{"rendered":"https:\/\/peraltafinancing.com\/advertising\/ftc-increases-scrutiny-of-negative-option-marketing\/"},"modified":"2025-02-01T06:05:14","modified_gmt":"2025-02-01T06:05:14","slug":"ftc-increases-scrutiny-of-negative-option-marketing","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=61561","title":{"rendered":"FTC Increases Scrutiny of Negative Option Marketing"},"content":{"rendered":"


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Retailers and service providers should take note: the Federal Trade Commission (FTC) is increasing its scrutiny of negative option marketing activity to combat unfair or deceptive practices related to subscriptions, memberships and other recurring-payment programs. The FTC issued today a notice of proposed rulemaking as part of its ongoing review of its 1973 Negative Option Rule\u2014one of the primary guides for the FTC\u2019s enforcement focus.<\/p>\n

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Negative option arrangements include \u201cfree trial\u201d programs that automatically convert to paid subscriptions, and \u201cautomatic renewals\u201d which allow sellers to unilaterally renew a consumer\u2019s paid subscription when it expires unless the consumer affirmatively cancels by a certain date. The FTC considers these marketing practices a renewed enforcement priority.<\/p>\n

Negative option marketing already requires special considerations, including specific disclosures of material terms, notice at specific intervals before automatic payments or renewals are initiated, prior notice of any changes to the terms of service with an opportunity to cancel, and easy and unimpeded cancellation processes under which compliant requests are timely honored. However, according to recent statements by the FTC, the current patchwork of federal laws and regulations does not provide brands with a consistent legal framework to follow. The proposed rule purports to address the gaps.<\/p>\n

Among the several significant updates the FTC is proposing, the new rule would implement the following:<\/p>\n