ICC Principles on Automatic Subscription Renewals

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When dealing with automatic renewals, what are the best practices businesses should consider?

Automatic renewals are popular and beneficial to consumers, offering the convenience of not having to constantly renew contracts for the purchase of goods or services that consumers regularly use. Free or discounted trials that convert to paid automatic renewals can provide consumers with an easy means to sample goods or services.

ICC upholds responsible, fair, honest and transparent marketing practices. As such it strongly discourages the use of practices that purposely manipulate consumers into unknowingly signing up for automatic renewals, or which trap consumers in automatic renewals by making it difficult to cancel. Applying the five principles below can help marketers avoid such practices:

• Disclosure: The material terms of an automatic renewal should be presented in a clear, prominent and unambiguous manner to the consumer before the consumer accepts the offer.
• Consent: Marketers should obtain consumers' consent to the material terms of an automatic renewal at the start of the contract.
• Written confirmation: Consumers should be provided with confirmation in a durable format of the material terms of the automatic renewal, including information regarding the cancellation policy and how to cancel.
• Cancellation: Cancelling an automatic renewal should be simple for consumers.
• Notice: For longer automatic renewal terms (for example, annual subscriptions), consumers should be given the option to receive notices before being charged to continue receiving the goods or services.