16 CFR Part 425: "Rule Concerning the Use of Prenotification Negative Option Plans"
I'm against all online Automatic Renewals because they put the final responsibility on the buyer to notify the seller that he/she wants to cancel. Plus, it is the buyer who determines the value of what he is buying at the time of the renewal, and not the seller. It doesn't matter how much "good will intent" there is on the part of the seller to "help" the buyer not miss out on the seller's buyer benefits. Auto-renewal puts the "responsibility to cancel" on the consumer-buyer vs. the "primary responsibility of renewal" on the seller to "earn the renewal". All sellers should at least offer an upfront choice of "automatic subscription renewal" or not. For online Automatic Renewal of subscriptions or yearly renewal of web addresses the FTC should mandate that sellers provide for "making sure consumers fully understand what they are ordering and paying for" at, or before, each and every renewal date through a "Return Receipt" e-mail that has to be received back with consumer acceptance by the seller before the "auto-renewal" legally kicks in. I like Consumer Reports information, but on 2/6/08 I got this renewal notice from them: "Your Subscription Renewal Dear William, Our records indicate that your subscription to ConsumerReports.org will be renewed soon at the rate of $19/year. That's because you signed up for a convenient annual auto-renewing subscription. On the one-year anniversary of your subscription, you will automatically be renewed for another year of ConsumerReports.org, and your card will be billed accordingly at the current year's annual rate. If any of your card information has changed (e.g. card expiration date) or if you need to change anything regarding your account, please click here to login and update your payment information. You may also click here to review the charge to your card for the scheduled renewal." There was no "renewal anniversary date" on that renewal notice, or link option to conveniently "cancel renewal". Even if the FTC mandates "giving consumers a specified time period to respond to announcements,", I suggest that the FTC mandate that the "renewal anniversary date" has to be put on all "Prenotification Negative Option Plans" renewal notices. While Consumer Reports would not try to cheat the consumer by shortening the time of the subscription, other less ethical publications might. On 3/4/09, ConsumerReports.org charged my credit card $19. I don't ever remember seeing a renewal notice in 2009, but that probably was because I had moved in early 2008 and changed email service from Netscape to gmail. My gmail account has no record of a "renewal notice" from them, and I would "archive" it, if I did get one, and never "delete" it in gmail. I don't known if I got one or not? Since I wanted the renewal, in 2009, it was not a problem for me this time. I may not want it for 2010, so I hope the FTC strengthens and expands the new Rule to cover additional types of negative option offers like online subscriptions, anti-virus software renewals, web address renewals, etc.. Again, I strongly suggest that multiple renewal notices be sent with an option to "cancel", and a "Return Receipt" e-mail function be used in all online renewal notices! Since there are usually three options open to responding to these type of e-mails, the FTC should make it mandatory that the seller receive back a written confirmation of the buyer's response through a "now" or "later" return receipt option from the buyer. If the buyer chooses "never", then the seller can't assume "informed consent". See my last blog post on all this: http://www.brokerblogger.com/brokerblogger/2007/02/anniversary_of_.html