WASHINGTON – New York City will adopt a policy to ban firms from engaging in subscription traps and enable consumers to easily cancel subscriptions through a so-called “Click to Cancel” rule, city officials said on July 10.
The offices of New York City Mayor Zohran Mamdani and Department of Consumer and Worker Protection Commissioner Samuel Levine cast the new policy as the first of its kind for a municipal government in the United States.
The policy will crack down on both “junk” fees and subscription traps, the offices said in a statement. The so-called “Click to Cancel” rule takes effect on Oct 1.
The rule applies to automatic renewal and continuous service subscriptions and requires businesses to clearly disclose subscription terms while providing a straightforward and transparent cancellation process, it said.
The “junk” fees rule requires businesses to advertise the full price of goods and services upfront, including all mandatory charges and fees, according to the statement.
Hidden fees cost an average family of four an estimated US$3,200 (S$4,130) each year, city officials said, citing consumer reports.
Businesses in violation will be subject to restitution for consumers and civil penalties beginning at US$525 per violation, city officials said about the policy.
Former US President Joe Biden’s administration had introduced a national “Click to Cancel” rule that was struck down by a federal appeals court in 2025 before its scheduled date to go into effect.
Mamdani, a democratic socialist, had campaigned on a promise to make New York City more affordable and took office in January. REUTERS