The 'click-to-cancel' rule required businesses to make it easy for consumers to cancel subscriptions and to obtain consent before charging for memberships. The FTC claimed it did not need a preliminary regulatory analysis due to an initial determination of economic impact being less than $100 million. A court found procedural errors in the rulemaking process, leading to its blockage. This was part of President Biden's 'Time is Money' initiative, aiming to address consumer-related issues. The FTC is also preparing for a trial related to Amazon's Prime program.
The FTC's proposed changes required businesses to obtain customer consent before charging for memberships and to disclose when free trials or promotional offers would end.
The U.S. Court of Appeals for the Eighth Circuit blocked the 'click-to-cancel' rule due to procedural errors related to the economic analysis of its impact.
The court stated that although they do not endorse unfair practices in marketing, the procedural deficiencies of the FTC's rulemaking process were fatal.
The FTC is currently working on preparations for a trial related to Amazon's Prime program amid accusations of deceptive marketing practices.
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