A “Click-to-Censel” RulesFor consumers, which would require businesses to make unwanted membership and easy to cancel unwanted membership, a federal appeal has been blocked by the court, it was set to implement it a few days earlier.
Businesses were required to obtain the consent of the customer before charging for membership, the proposed changes of the Federal Trade Commission adopted in October, Auto-renewal And programs associated with free testing offers.
The FTC said at the time that businesses should also disclose when free testing or other promotional proposals are abolished and customers can easily cancel the recurring membership.
President Joe Biden’s administration included FTC proposal as part of it “Time is money” initiativeA government initiative which was declared last year for the purpose of breaking up on consumer related mess.
The FTC rule was scheduled to implement on Monday, but the US Court of Appeals for the eighth circuit said this week that FTC failed to come up with initial regulatory analysis and made a procedural error, which is required for rules that are more than $ 100 million annual effects on the US economy.
The FTC claimed that it was not to come up with the initial regulatory analysis as it was initially determined that the impact of the rule on the national economy would be less than $ 100 million. An Administrative Law Judge decided that the economic impact would be higher than the limit of $ 100 million.
The court decided to vacate the rule.
The court wrote, “While we certainly do not support the use of inappropriate and misleading practices in negative option marketing, the procedural shortcomings of the commission’s ruling process are fatal here.”
FTC refused to comment on Wednesday.
The agency is currently moving forward with its preparation tests Involved Amazon Prime ProgramStems from the test Case of a federal trade commission It accused Amazon of admission to consumers in his major event without his consent and it became difficult for him to cancel his membership.
The test is expected to be held next year.
Michelle Chapman, Associated Press