No new federal ban on shady subscription auto-renewals is in effect in the United States. The headline combines two separate events. In July 2025, a federal appeals court vacated the FTC’s 2024 Negative Option Rule, the “click-to-cancel” rule. In March 2026, the FTC asked the public to comment on whether that rule’s framework should be amended. A request for comment starts a rulemaking. It does not create a final rule. Federal statute and state laws against unwanted recurring charges still apply.
What the court actually decided
In Custom Communications, Inc. v. Federal Trade Commission, the U.S. Court of Appeals for the Eighth Circuit vacated the FTC’s 2024 Negative Option Rule on July 8, 2025. The court found that the agency had not followed a required procedural step in its rulemaking. It did not find that deceptive subscription practices are lawful. The court wrote: “While we certainly do not endorse the use of unfair and deceptive practices in negative option marketing, the procedural deficiencies of the Commission’s rulemaking process are fatal here.” (U.S. Court of Appeals for the Eighth Circuit, Custom Communications, Inc. v. FTC, 2025)
The ruling removed the rule itself. It did not erase the federal statute the FTC relies on for online subscription cases, and it did not displace state automatic-renewal laws.
The legal layers, compared
Most confusion comes from treating these layers as one. They differ in scope, status, and who must comply.
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| Layer | Scope | Status (as of October 2026) | Who must comply |
|---|---|---|---|
| FTC Negative Option Rule, 2024 (“click-to-cancel”) | FTC rule covering negative option marketing | Vacated by the Eighth Circuit on July 8, 2025 | Not in effect as a rule |
| Restore Online Shoppers’ Confidence Act (ROSCA) | Covered online negative-option transactions | In force; the FTC enforces it | Covered sellers, who must clearly disclose material terms and obtain express informed consent before charging an account |
| State automatic-renewal laws | Set by each state | In force where enacted; requirements vary and are not mapped in this article | Sellers covered by the law of the state where the consumer is located, as that state defines it |
| Proposed amendments to the Negative Option Rule | Possible changes to FTC rules on recurring payments and cancellation | Public comment requested in March 2026; no final rule | Nobody yet; obligations would arise only from a final rule |
ROSCA: the federal protection still in force
ROSCA remains the central federal law for covered online negative-option transactions. Under the FTC’s summary, covered sellers must clearly disclose material terms and obtain express informed consent before charging a consumer’s account. FTC materials also describe a simple way for consumers to stop recurring charges on covered transactions. ROSCA is not identical in scope to the vacated rule. It covers a defined set of transactions, so a charge that falls outside that definition may depend on state law or contract terms.
State automatic-renewal laws
State automatic-renewal statutes may impose requirements beyond federal law, such as disclosure or cancellation rules that differ from one state to another. This article does not summarize them state by state. Check your state attorney general’s website for the rules that apply where you live.
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What the FTC has done since the ruling
March 2026: a request for public comment
In March 2026, the FTC sought public comment on whether amendments to its Negative Option Rule were needed. The stated aim was to help consumers avoid recurring payments they did not intend and to cancel without unwarranted obstacles. The notice is the start of a rulemaking. Until the FTC issues a final rule, no new nationwide requirement exists under that proceeding.
Enforcement cases
The FTC has also pursued individual companies. The two most recent examples below are allegations or settlements, not final court findings on the merits.
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| Company | Date and status | What the FTC says |
|---|---|---|
| Chegg | Settlement announced September 2025 | The company agreed to provide a simple cancellation mechanism and pay $7.5 million. The FTC announcement said that since October 2020 Chegg had charged nearly 200,000 consumers after they requested cancellation. These are the FTC’s allegations as stated in its announcement. |
| Uber | Pending as of the FTC case page’s May 2026 listing; later status not verified here | The complaint concerns Uber One enrollment, recurring charges, and cancellation. These are allegations, and the case can move toward settlement or resolution at any time. |
How to stop an auto-renewing subscription
The FTC defines a negative option as a setup in which you are billed automatically unless you take action to stop it. The steps below follow its consumer guidance.
- Check the sign-up terms before you agree. Look for preselected boxes, the renewal price, and the cancellation method the company describes.
- Cancel through the company’s official channel. Use the account settings or support page you reach from the company’s own website or app. If the company gives a cancellation method in its terms, use that method.
- Keep proof. Save the confirmation number, screenshots of the cancellation screen, and any dated emails or chat transcripts.
- Watch the next statements. Check your bank or card statements for charges after your cancellation date.
- Dispute charges when appropriate. Contact your card issuer or bank about any charge that continues after you cancelled, and include your proof.
- Report problems. Report the company to the FTC or your state attorney general if it keeps charging you or makes cancellation difficult.
Handling suspicious renewal notices
Scammers often send messages that look like subscription renewal notices. The FTC’s guidance is direct:
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- Do not enter payment details through a link in an unexpected renewal notice.
- Contact the company using a channel you already know is genuine, such as the phone number on your past receipts or the app you originally used.
- If a message pressures you to act immediately, treat the urgency as a warning sign.
What remains unverified
Some coverage links the subject to a congressional proposal introduced after the court decision. This article could not confirm that proposal’s sponsors, text, or legislative status, so it does not describe its provisions. Treat any claim that a new federal auto-renewal ban has been enacted as unconfirmed unless a primary government source says so.
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