California Automatic Renewal Law (Business and Professions Code §§ 17600–17606), as amended by AB 2863

What it requires

The law applies to any business making an automatic renewal or continuous service offer to a consumer in California. AB 2863 widened both definitions to cover any plan, arrangement or contract provision containing a free-to-pay conversion, in which a customer receives a product or service free for an initial period and must pay unless they cancel (§ 17601(a)). Section 17602(a) requires the offer terms to be shown clearly and conspicuously, in visual proximity to the request for consent, and, for a free trial, the price that will be charged when it ends; affirmative consent before charging a card or an account with a third party; and a retainable acknowledgment of the terms, the cancellation policy and how to cancel. AB 2863 added a requirement of express affirmative consent to the renewal terms, records verifying that consent for at least three years, or one year after the contract ends if longer, and a ban on misrepresenting any material fact related to the transaction. A business that lets consumers accept online must let them end the renewal exclusively online, at will and without obstructive steps, through a prominently located link or button, which may sit in a customer account or in device or user settings, or a pre-formatted termination email (§ 17602(d)). Retention offers during online cancellation must sit beside a continuously displayed click-to-cancel link or button (§ 17602(e)). Cancellation must be available in the medium used to sign up or the one the consumer usually uses with the business (§ 17602(f)). A fee change needs notice 7 to 30 days ahead (§ 17602(g)); annual plans need a yearly reminder of the product, the frequency and amount of charges and the means to cancel (§ 17602(h)). Violations are not crimes but carry civil remedies; good-faith compliance is a defence (§ 17604).

Why it bears on this field

Weekly, monthly and annual passes that renew until cancelled are automatic renewals or continuous services under the article, and free trials that roll into paid passes are free-to-pay conversions. Because the article reaches charges to a consumer's account with a third party, it is not confined to subscriptions billed directly by the app operator, and the online-termination rule expressly allows the cancellation control to sit within device or user settings. The fee-change notice applies to fee changes on existing passes; the annual reminder applies only to annual plans. One-off coin bundles that do not renew fall outside the definitions, and the article protects consumers in California only. The 2025 amendments govern contracts entered into, amended or extended from 1 July 2025; contracts entered into earlier and not since amended or extended remain under the prior text.

Open questions

• Does an automatic renewal after 1 July 2025 of a subscription first sold before that date count as an extension that brings it under the amended text?
• Where a subscription is sold, billed and cancelled through an app store's own billing and settings, does the app operator or the app store carry the duties to send the acknowledgment, the fee-change notice and the annual reminder under § 17602?

Timeline

• 2010-12-01Article 9 (§§ 17600–17606) of the Business and Professions Code, on automatic purchase renewals, becomes operative. Source (opens in a new tab)
• 2024-09-24The Governor approves AB 2863, which is chaptered as Chapter 515, Statutes of 2024. Source (opens in a new tab)
• 2025-01-01AB 2863 takes effect, amending sections 17601 and 17602. Source (opens in a new tab)
• 2025-07-01The AB 2863 amendments begin to apply to contracts entered into, amended or extended on or after this date. Source (opens in a new tab)