New York City’s “Click-to-Cancel” Proposal Signals A New Era In Subscription Regulation

In a move that could bolster efforts to reshape the landscape of subscription-based commerce, New York City Mayor Zohran Kwame Mamdani and Department of Consumer and Worker Protection (DCWP) Commissioner Samuel A.A. Levine recently unveiled a proposed “Click-to-Cancel” rule that would position New York City at the forefront of consumer protection in this space. Announced by the DWCP on April 9, 2026, the rule aims to eliminate so-called “subscription traps” by requiring businesses to make cancellation as simple as enrollment. The full text of the proposed rule appears here.

The proposal follows Executive Order 10, aptly titled “Fighting Subscription Tricks and Traps,” and reflects a broader regulatory push to address practices that critics argue are designed to frustrate consumers into maintaining unwanted subscriptions. As Mayor Mamdani put it, if a consumer can sign up with a click, they should be able to cancel with a click—a principle that sits at the heart of the proposed rule.

Key Features of the Proposed Rule

The proposed rule would apply broadly to automatic renewals and continuous service offers, covering a wide range of industries—from gyms to digital platforms. The proposal also directly targets practices such as “free trials” that convert into paid subscriptions without meaningful consumer awareness, as well as cancellation processes that are intentionally difficult to navigate. Among the consequences, should the rule be adopted as proposed:

1. Simple Cancellation Mechanisms: Businesses will have to provide a clear, straightforward way for consumers to cancel subscriptions, eliminating multi-step or opaque processes.
2. Enhanced Disclosures: Companies will be required to clearly inform consumers of subscription terms at sign-up, including renewal and cancellation rights.
3. Greater Enforcement Authority: DCWP will have citywide authority to enforce compliance, with penalties starting at $525 per violation, along with potential restitution to affected consumers.

A First-of-Its-Kind Municipal Initiative

Notably, this would appear to be the first municipal rule of its kind in the United States, underscoring the increasingly prominent role of state and local regulators in consumer protection. Advocacy groups, including the National Association of Consumer Advocates and the Consumer Federation of America have praised the proposal as both innovative and necessary, particularly at a time when federal regulatory activity in this space has been perceived as uneven.

The rule may also serve as a template for other jurisdictions. As momentum builds nationwide to address deceptive subscription practices, New York City’s approach could become a model for state legislatures and local governments seeking to enhance consumer safeguards.

What Comes Next

The proposed rule was published in the City Record on April 8, 2026, triggering a 30-day public comment period under the City Administrative Procedures Act along with a virtual hearing on May 8, which will be accessible by phone and videoconference. Thereafter, DCWP will evaluate feedback and determine whether to finalize the rule, potentially with revisions.

Why It Matters for Businesses

While a final rule may ultimately be challenged, at least in part because it would be based on an unspecified but apparently relatively small number of complaints in such a populous city (only “more than 100” last year), for companies operating in or marketing to New York City residents, the proposal is a clear signal: subscription practices are under heightened scrutiny. Businesses should begin working with counsel now to assess their enrollment flows, disclosure practices, and cancellation mechanisms to ensure they align with the rule’s anticipated requirements.

More broadly, the proposal reflects a continuing shift toward “symmetry” in consumer transactions—where ease of entry must be matched by ease of exit. Whether at the municipal, state, or federal level, regulators are increasingly focused on ensuring that consumer consent is both informed and revocable without friction.

If adopted, New York City’s “Click-to-Cancel” rule will not only impact local businesses but could also help accelerate a nationwide rethinking of how subscription services are offered—and how they must be unwound.

Federal Context and Commissioner Levine’s Prior Role

The New York City proposal comes against the backdrop of recent—and somewhat turbulent—federal efforts to regulate subscription or “negative option” cancellation practices. The Federal Trade Commission had finalized a sweeping “click-to-cancel” rule designed to require clear disclosures, express informed consent, and cancellation mechanisms that are as easy to use as the sign-up process.

However, that final rule was vacated by the United States Court of Appeals for the Eighth Circuit, which held that the FTC failed to adhere to required procedural safeguards in promulgating the rule. In particular, the court found deficiencies in the FTC’s rulemaking process under Section 22 of the FTC Act, which requires a preliminary economic analysis when a rule would have an annual impact on the economy surpassing $100 million.

In response, the FTC has more recently signaled a renewed effort to advance a revised version of its negative option rule. On March 13 it published in the Federal Register an advance notice of proposed rulemaking requesting public comment on the extent to which businesses market goods and services through negative options, the nature and prevalence of problematic practices, and specific ways to address unfairness or deception in the marketplace.

The FTC is expected to continue focusing on core themes reflected in the New York City proposal—namely, requiring clear and conspicuous disclosure of material terms, obtaining consumers’ express informed consent, and ensuring simple, symmetrical cancellation mechanisms—while attempting to address the procedural and substantive concerns identified by the court. Notably, Sam Levine previously served as Director of the FTC’s Bureau of Consumer Protection during the development of its rule.

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