Unsubscribe Act of 2025
- Bill Number
- H.R. 7048
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Commerce
- Status
- Introduced
- Latest Action
- 2026-01-13: Referred to the House Committee on Energy and Commerce.
- Last Updated
- 2026-04-14T20:29:16Z
AI-Generated Summary
Purpose
The Unsubscribe Act of 2025 aims to enhance consumer protections against "negative options" in sales contracts. A negative option is a provision where a consumer's silence or inaction is treated as acceptance of goods, services, or renewals, often leading to unwanted charges. The law targets these practices across all media, including online platforms, to ensure clear disclosures, informed consent, and easy cancellations.
Key Provisions
- Disclosure and Consent Requirements: Merchants (defined as businesses entering financial contracts with consumers) must clearly disclose all material terms of negative option contracts before charging any payment method, such as a credit card or bank account. They must also obtain "express informed consent" from consumers—a clear, affirmative action like checking a box or clicking a button, separate from initial purchase agreement. Consent records must be kept for at least 3 years.
- Contract Term Limits: After an initial "preliminary period" (the time before automatic renewals or charges begin), merchants cannot extend the contract beyond that period without new express informed consent for renewal.
- Cancellation Mechanisms:
- For online contracts, merchants must provide a simple electronic cancellation option, like a direct link to a form, without extra steps.
- For non-online contracts, cancellation must be as easy as signing up, or via another straightforward method.
- Applies to various negative option types, including automatic renewals, continuity plans (periodic shipments unless rejected), and pre-notification plans (offers sent periodically that ship unless rejected).
- Special Rules for Free-to-Pay Conversions: These are contracts with a free or discounted introductory period that then charge full price. Merchants must notify consumers of all terms (e.g., costs during and after the intro period, total estimated costs for up to 12 months) and get consent before the first charge. Reminders must be sent before charges start or increase, including cancellation info.
- Ongoing Notifications: Merchants must send annual reminders of contract terms and cancellation options. Additional notices are required 2-7 days before a cancellation deadline to avoid charges.
- Enforcement: Violations are treated as unfair or deceptive practices under the Federal Trade Commission (FTC) Act. The FTC can investigate, sue, and impose penalties. States can also bring lawsuits on behalf of residents, but must notify the FTC first and cannot act if the FTC is already pursuing the same case. The FTC must issue rules to implement the law.
- Preemption: The law does not override state consumer laws unless they directly conflict; states can offer stronger protections. Differences in timelines (e.g., how quickly something must happen) count as conflicts.
- Definitions: Key terms include "negative option contract" (covering renewals, continuity plans, etc.), "simple mechanism" (easy cancellation process, based on existing FTC rules), and exclusions for consent obtained through tricks like pre-checked boxes or manipulative designs.
- Effective Date: Applies to contracts entered or amended 1 year after enactment.
Significant Changes to Existing Law
This act expands on current FTC regulations (e.g., 16 CFR Part 425 on negative option marketing, which focuses on mail-order and phone sales). It broadens coverage to all media, including internet-based transactions, and introduces stricter rules for consent, disclosures, and cancellations not fully detailed in prior laws. It also mandates record-keeping, term limits, and proactive notifications, going beyond voluntary guidelines to create enforceable requirements.
Potential Impacts
- On Citizens (Consumers): Reduces surprise charges from subscriptions or trials by making it harder for businesses to use fine print or buried terms. Easier cancellations could save time and money, empowering users to manage recurring payments without hassle.
- On Government Agencies: The FTC gains explicit authority to enforce via rules and penalties, potentially increasing its workload but streamlining consumer complaint handling. State attorneys general can assist, fostering coordinated oversight without duplicating efforts.
- On Businesses (Merchants): Requires updates to online interfaces, consent processes, and billing systems, which may raise compliance costs but decrease chargebacks, disputes, and lawsuits from unhappy customers.
- On International Relations: No direct impact, as the law focuses on U.S. domestic commerce and consumer protections.
Main Stakeholders Affected
- Consumers: Primary beneficiaries, protected from deceptive auto-renewals and trials.
- Merchants of Record: Businesses offering goods/services with negative options (e.g., streaming services, gyms, e-commerce subscriptions) must adapt practices.
- Federal Trade Commission (FTC): Leads enforcement and rulemaking.
- State Attorneys General and Agencies: Can pursue local violations, supporting federal efforts.
- Consumer Advocacy Groups: Likely to monitor compliance and educate the public.
Notable Legal, Constitutional, or Political Implications
- Legal: Integrates with the FTC Act, treating violations as deceptive practices for civil penalties (up to $50,120 per violation under current FTC rules). Enhances enforceability by allowing state actions with FTC oversight, reducing forum-shopping. Limited preemption preserves state innovations in consumer law.
- Constitutional: Aligns with Congress's commerce clause authority over interstate trade, including online sales. No apparent First Amendment issues, as it regulates commercial speech with clear disclosure mandates rather than suppressing content.
- Political: Promotes bipartisan consumer rights (introduced by members from both parties), potentially reducing public frustration with "subscription traps." Could influence future digital economy regulations, balancing business innovation with anti-deception measures, but may face opposition from industries reliant on auto-renewals.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (3)
Rep. Amodei, Mark E. [R-NV-2], Rep. Magaziner, Seth [D-RI-2], Rep. Nehls, Troy E. [R-TX-22]
Recent Actions
- 2026-01-13: Referred to the House Committee on Energy and Commerce.
- 2026-01-13: Introduced in House
- 2026-01-13: Introduced in House
Bill Versions
- Unsubscribe Act of 2025 — issued 2026-01-13 — PDF (15 pages)