The Federal Trade Commission has announced significant revisions to its Negative Option Rule, now called the Rule Concerning Recurring Subscriptions and Other Negative Option Programs. These changes aim to enhance consumer protection by preventing misleading enrollment tactics and ensuring transparent billing practices. The final rule will take effect in 180 days, with some provisions starting within 60 days. Notably, the rule applies to nearly all negative option marketing, including automatic renewals and free trial offers, covering business-to-business and business-to-consumer transactions. Businesses must disclose all material terms clearly before consumers enroll, obtain proof of consent before charging, and provide an easy cancellation method, commonly referred to as “Click to Cancel.” Violators of the new rule may face civil penalties, emphasizing the need for compliance as the FTC moves to strengthen consumer rights in subscription services.
The U.S. Federal Trade Commission is investigating Deere & Company’s repair policies, which may infringe on customers’ “right to repair” their purchased equipment. This probe, authorized on September 2, 2021, was revealed through a filing by Hargrove & Associates, which is not a target of the investigation. The tractor manufacturer is already facing lawsuits from U.S. farmers over similar antitrust concerns.
The Federal Communications Commission has announced new regulations requiring all smartphones in the U.S. to be compatible with hearing aids. This includes implementing Bluetooth pairing standards to prevent proprietary technology that limits compatibility. The FCC emphasizes the need for improved volume control, ensuring clearer audio for all users, not just those with severe hearing loss. New product labeling must also inform consumers about hearing aid compatibility and specific requirements. The transition period for manufacturers will span up to 42 months, aligning with ongoing public health efforts to enhance hearing aid accessibility.
The deadline for EU Member States to begin applying the new cybersecurity law, NIS2, which expands the scope of cybersecurity regulations across various sectors, including energy and healthcare, has now come and gone. Key features of NIS2 include stricter security obligations that require entities to report significant incidents within 24 hours and direct accountability from management bodies for cybersecurity measures. Non-compliance can lead to fines of up to €10 million or 2% of global turnover.
Why do we care?
The Subscription Rules are going to be important for vendors serving MSPs as well as MSPs themselves. If you offer a subscription, you will need to ensure the ability to cancel. This is also something you now must note with your vendors too – it has to be as easy to cancel as it does to start. MSPs frequently offer services on a subscription basis, whether for IT support, cloud services, security solutions, or software tools. The FTC’s new rule requires clear and transparent billing, with material terms presented upfront before consumers (or business clients) are enrolled in any service. MSPs must audit their subscription processes now, ensuring that terms are clearly communicated and clients can cancel services as easily as they sign up. This includes making sure that all free trial offers or automatic renewals follow these new rules.
To say nothing of right to repair and NIS2.
