A look at Californias new auto-renewal law

Published: Monday, July 7, 2025 at 2:08 pm

California's New Auto-Renewal Law: Protecting Consumers from Hidden Charges

Sacramento, CA – California consumers now have enhanced protections against unexpected charges from subscription services and free trials, thanks to the recently enacted auto-renewal law, AB 2863. This legislation aims to increase transparency and empower consumers in managing their online subscriptions.

The law mandates that businesses clearly disclose all terms and conditions before a consumer provides payment information, even for free trials. This includes the trial's duration, the post-trial charges, and the billing frequency. Crucially, companies can no longer assume consent; consumers must actively agree to the auto-renewal terms before any charges are applied.

Following signup, businesses are required to provide a post-signup confirmation detailing the subscription terms, renewal schedule, and the cost after any free trial concludes. This confirmation must also include clear instructions on how to cancel the subscription. Cancellation processes must be straightforward, allowing consumers to cancel through the same method they used to sign up or typically use for communication, such as phone, email, mail, or online portals.

For long-term subscriptions, the law requires companies to send an annual reminder to subscribers, informing them of the subscription's continued existence and providing cancellation instructions. Furthermore, businesses must provide at least seven days' advance notice of any price increases, preventing unexpected hikes in subscription fees.

Consumers are advised to save the post-signup confirmation email, as it contains crucial information about the subscription terms and cancellation procedures. Setting reminders for the end of free trials is also recommended to avoid unexpected charges. If a consumer believes a company has violated the law, they may be entitled to a refund. Consumers can report violations to the Marin District Attorney's Office Consumer Protection Unit.

BNN's Perspective: This new law is a welcome step towards consumer protection in the digital age. While it may place additional burdens on businesses, the increased transparency and ease of cancellation will ultimately foster greater trust and fairness in the marketplace. It's a balanced approach that protects consumers without unduly hindering legitimate business practices.

Keywords: auto-renewal law, California, AB 2863, subscriptions, free trials, consumer protection, billing, cancellation, price increases, consumer rights, Marin District Attorney's Office.

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