New York City has adopted a new rule that bans companies from using deceptive subscriptions to trap customers into paying for gym memberships, streaming services and other recurring charges, the city's consumer protection office said.
The rule, which takes effect Oct. 1, prohibits companies from charging customers recurring fees without clear disclosure and an easy cancellation process. It also targets so-called "junk fees" that obscure the true cost of subscriptions.
Companies that fail to provide a simple way to cancel could face fines of $525 per user subscription, back fees and additional penalties. The rule promises aggressive enforcement against violators.
New York City is the first municipality in the United States to adopt such a ban.
