New York City Enacts ‘Click-to-Cancel’ Rule to Ban Subscription Traps and Junk Fees

The rule, announced by Mayor Zohran Mamdani, applies to all businesses operating within the five boroughs that offer automatic renewal or subscription services. Under the new regulation, companies must provide a straightforward cancellation method, such as a single click or a simple phone call, that mirrors the ease of the original sign-up process.

The measure specifically targets 'subscription traps,' where consumers are lured into free trials or low-cost introductory offers and then charged recurring fees without clear consent or an easy way to opt out. It also addresses 'junk fees,' which are hidden or misleading charges added at checkout or during billing.

Businesses that fail to comply will face penalties, though the city has not yet specified the exact fines. The rule is part of a broader push by the mayor's office to protect consumers from deceptive practices, following similar actions at the state and federal levels.

Consumer advocates have praised the move as a significant step toward transparency, while some business groups have raised concerns about the administrative burden of implementing new cancellation systems. The city plans to release detailed compliance guidelines for businesses in the coming months.

The rule takes effect on October 1, 2026, giving companies nearly two years to adjust their billing and cancellation processes. City officials say they will conduct outreach to small businesses to ensure they understand and can meet the new requirements.