The Federal Trade Commission (FTC) has approved a new "Click to Cancel" rule requiring businesses to make subscription cancellations as easy as signing up. This regulation is part of an update to the FTC's negative option rule from 1973.

Key Changes:

• Businesses must provide a simple cancellation mechanism that's easily accessible through electronic means
• Companies cannot require customer service calls to cancel unless this was part of the initial signup process
• Sellers must clearly display purchase information and terms upfront
• The rule prohibits preventing consumers from avoiding charges or stopping recurring payments

Implementation Details:

• The rule will take effect 180 days after Federal Register publication
• Exemptions are available for certain businesses
• Penalties will be enforced for violations

The regulation passed with a 3-2 commission vote, though Commissioner Melissa Holyoak expressed concerns about the rule being "overbroad" and potentially unlawful. Commissioner Rebecca Kelly Slaughter, while supporting the measure, noted the absence of a requirement for annual subscription reminders.

Impact on Music Industry: While streaming services generally have straightforward cancellation processes, this rule could affect other music-related subscriptions and services, particularly in areas like satellite radio and live entertainment where consumer complaints are more common.

This regulation aims to protect consumers by ensuring transparency and ease of cancellation across all subscription-based services, bringing outdated regulations in line with modern digital commerce practices.

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