New York City moves to ban subscription traps and junk fees

New York City has moved to require businesses to make subscription cancellation simple and show the full price of goods and services up front, becoming the first municipality in the United States to impose that standard. The city’s final Click-to-Cancel rule takes effect on October 1 and will be enforced by the Department of Consumer and Worker Protection. The rules target subscription traps that keep charging customers and junk fees buried until the last screen of a purchase.

The city’s final Click-to-Cancel rule covers automatic-renewal and continuous-service subscriptions, requiring businesses to clearly disclose the terms and give consumers a straightforward way to cancel. The city projects the rule alone will save New Yorkers up to $162.5 million a year, and violations can trigger restitution for consumers and civil penalties starting at $525 per violation.

Mayor Zohran Mamdani and DCWP Commissioner Samuel A.A. Levine announced the action on July 10 alongside a proposed junk-fee rule that would require transparent all-in pricing. Consumer Reports says hidden fees cost the average family of four about $3,200 a year. Mamdani, who campaigned on affordability, has focused his first months in office on recurring charges in streaming, gyms, software subscriptions and other services that often rely on fine print and difficult cancellation screens.

On January 5, Mamdani signed Executive Orders 9 and 10 directing DCWP to target junk fees and subscription tricks and traps. On February 19, the agency sent compliance warning letters to 187 gyms and health clubs, including PureGym, Planet Fitness and Equinox. On April 9, DCWP published the proposed municipal Click-to-Cancel rule and opened a 30-day public comment period.

The FTC finalized its own click-to-cancel, or negative-option, rule in October 2024 after receiving more than 16,000 public comments, and that rule applies to almost all negative-option programs. The city rule adds city-level oversight and penalties.