The Massachusetts Attorney General has released final regulations (“the Final Regulations”) imposing obligations on businesses that offer auto-renewing subscriptions, as well as businesses that impose purportedly hidden or misleading fees (referred to as “junk fees”). The Final Regulations differ in meaningful ways from the proposed regulations published by the Massachusetts Attorney General in 2023. The Final Regulations, which will take effect on September 2, 2025, feature disclosure, renewal notice, and cancellation requirements that go beyond the obligations imposed by other state auto-renewal laws, as well as separate “junk fee” disclosure obligations that apply to both subscription and non-subscription purchases.
In particular:
- At the point of sale, sellers will need to account for a more exacting definition of “clear and conspicuous” and disclose certain, specific “calendar dates” if the subscription begins with a free trial or promotional period.
- The renewal notice requirements impose unique obligations on subscriptions with renewal terms of 31 days or less.
- The cancellation obligations align with some of the more stringent requirements imposed by other laws and regulations (including the FTC’s Negative Option Rule).
- The “junk fee” provisions aim to prohibit businesses from (i) tacking on additional fees late in the purchase flow or (ii) otherwise misrepresenting the nature of specific fees. These provisions will materially impact various disclosures, including service fees, processing fees, installation fees, and early termination fees.
Massachusetts is the latest in a series of states moving to regulate the auto-renewal landscape. While businesses should evaluate their auto-renewal practices to address the Massachusetts regulations (as a violation constitutes an unfair and deceptive act or practice under Massachusetts law), businesses should also consider how the Massachusetts regulations fit within the broader auto-renewal landscape, which has become an area of increasingly active legislation, regulation, and enforcement.
