FTC Reopens The "Click-to-Cancel" Debate: New Negative Option ANPRM Puts Subscription Businesses On Notice

On March 11, 2026, the FTC issued an Advance Notice of Proposed Rulemaking (ANPRM) seeking public comment on whether to amend or replace the agency's longstanding Negative Option Rule. The ANPRM follows the 2024 judicial vacatur of the FTC's sweeping "click-to-cancel" rule and signals the agency's intent to revisit the regulatory landscape for subscription services, free trials, and auto-renewal programs. Businesses that use negative option marketing should treat this as an early warning: a new rule is coming, and now is the time to shape it.

WHAT IS A NEGATIVE OPTION AND WHY IS THE FTC FOCUSED HERE?

A negative option is any marketing practice in which a consumer's failure to take an affirmative action, such as canceling a subscription, returning a product, or opting out of a program, is considered permission to charge the consumer. Negative options are ubiquitous across industries, including streaming subscriptions, gym memberships, software-as-a-service, free trials that auto-convert to paid plans, and continuity programs of all kinds.

The FTC has regulated negative options since 1973 through its "Rule Concerning the Use of Prenotification Negative Option Plans" (the "Negative Option Rule"). The rule does not squarely address the modern digital subscription economy, and the FTC is reviewing how to close the clear gap.

The FTC reports that it has received more than 100,000 consumer complaints related to negative option and subscription practices over the past five years. The most common themes include unclear disclosures at enrollment, charges consumers did not expect or consent to, and cancellation processes that are difficult or impossible to navigate.

WHAT HAPPENED TO THE 2024 "CLICK-TO-CANCEL" RULE?

In 2024, the FTC finalized a sweeping update to the Negative Option Rule, commonly referred to as the "click-to-cancel" rule, that required businesses to make cancellation as easy as enrollment, mandated clearer disclosures, and prohibited certain retention tactics. The rule drew immediate legal challenges.

A federal court vacated the 2024 rule before it took effect, finding procedural defects in how the

FTC conducted its rulemaking. That vacatur left the agency's original 1973 rule in place, and while the FTC continues to bring actions under the Restore Online Shoppers' Confidence Act (ROSCA), the FTC is seeking to fill gaps that ROSCA does not reach. The ANPRM announced on March 11, 2026, is the current FTC's formal response to those gaps. Rather than re-promulgating the vacated 2024 rule, the agency is starting a new rulemaking process.

WHAT THE FTC IS ASKING: FOUR AREAS OF INQUIRY

The ANPRM invites comment on four substantive categories:

• The Negative Option Marketplace. How widespread negative option programs are, and how they operate across sectors.
• Harmful Negative Option Practices. What specific practices prevent consumers from understanding terms, result in enrollment without express informed consent, or impede cancellation?
• Regulatory Options. Should the FTC retain the 1973 rule as-is, adopt provisions from the vacated 2024 rule, craft new provisions, or pursue non-regulatory alternatives such as consumer and business education programs? The agency is explicitly holding all options open.
• Supporting Data and Studies. The FTC is specifically requesting market studies, economic data, consumer research, and empirical evidence.

Comments are due 30 days after the ANPRM they are published in the Federal Register.

NEXT STEPS FOR BUSINESSES

The proposed rules will impact any business that uses recurring billing, auto-renewal, free trials, paid subscriptions, or continuity programs. Impacted businesses should submit data-driven comments that present a factual record of how negative option programs operate, what disclosures the industry currently provides, and what the costs of various regulatory approaches would be for the industry. The ANPRM record will directly shape what rule, if any, the FTC finalizes.

This ANPRM fits within a broader regulatory trend at the intersection of consumer protection and technology. As AI increasingly powers the systems that manage subscription enrollment, billing, and retention, regulators are asking harder questions about whether algorithmic decision-making creates new forms of consumer harm.

The FTC has already demonstrated a willingness to pursue cases involving AI-enhanced dark patterns and deceptive design. The negative option rulemaking creates another opportunity for the FTC to codify those positions into binding rules with civil penalty authority that would apply to future violations. For businesses at the frontier of AI-driven subscription services and digital commerce, early engagement with this rulemaking is strategic.

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