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03 Nov

November 2021: California Passes Legislation on Automatic Subscriptions

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Update Applicable to:

All companies that provide automatic subscriptions in California.

What happened?

On October 4, 2021, Governor Newsom signed into law Assembly Bill No. 390 (AB 390), which adds new renewal reminder notice requirements and cancellation requirements to the Automatic Renewal Law (ARL).

What are the details?

These new requirements will be effective on July 1, 2022:

  • Most businesses selling automatic renewal plans to California consumers with an initial term of one year or longer will need to deliver notices to their California subscribers 15 to 45 days before the renewal date reminding them that their plans will automatically renew unless canceled.

  • Businesses selling automatic renewal plans to California consumers with a free trial, gift, or initial discount period lasting longer than 31 days will need to provide similar notices to their California subscribers three to 21 days before the expiration of the applicable period.

Online sellers of automatic renewal plans will have to offer subscribers the ability to cancel automatic renewal features online “immediately” (after account authentication) by clicking on a button or link, or by sending a pre-formatted termination email message.

For more information, please see the links below:

Assembly Bill No. 390
Article 1 Article 2

What do employers need to do?

Employers should review the information above and prepare to make changes to their subscription and reminder system to comply with the additional rules.