An amendment to California’s Automatic Renewal Law (Business & Professions Code §17602) will go into effect on July 1, 2022. The amendment, which was signed into law in October 2021, requires increased notifications to consumers regarding any subscriptions or trials which automatically renew.

It is important to be familiar with the existing Automatic Renewal Law, which requires businesses which offer subscriptions to do the following:

  • Inform consumers of the cost and frequency of any automatic renewal before or during the subscription enrollment or when processing payment;
  • Inform consumers of the details of the subscription and the applicable cancellation instructions in an email or other form of message;
  • Inform consumers of any price changes before the subscription automatically renews;
  • Have an easy-to-access cancellation system; and
  • Make the above information conspicuous.

The amendment which takes effect July 1 applies to free subscription trials longer than 32 days or any paid subscriptions which have an initial term of at least one year. The law will now require that an additional notification or message be sent to consumers between 3 and 21 days before renewal (for a 32+ day trial) or between 15 and 45 days before renewal (for a yearlong subscription).

In addition, the new notifications must state the date of renewal, the renewal duration, and the renewal cost. Similar to the current requirements, the new notifications must include a cancellation link or instructions. Finally, the contact information for the business must also be included in the message. All of this information must be conspicuous.

A company which does not adhere to these new requirements, or the existing requirements, of the Automatic Renewal Law can be subject to civil penalties from both consumers and the government. Therefore, it is important for all businesses which offer subscriptions to regularly review their automatic renewal processes for legal compliance.