I 118th CONGRESS 1st Session H. R. 2460 IN THE HOUSE OF REPRESENTATIVES April 3, 2023 Ms. Clarke of New York introduced the following bill; which was referred to the Committee on Energy and Commerce A BILL To provide for automatic renewal protections, and for other purposes.

1. Short title This Act may be cited as the Consumer Online Payment Transparency and Integrity Act . 2. Automatic renewal protections (a) In general A person who sells a good or service to a consumer pursuant to a contract that includes a free-to-pay conversion or negative option feature or any other automatic renewal provision shall disclose such feature or provision and the cancellation procedure clearly and conspicuously in the contract. (b) Automatic renewal A person who sells a good or service to a consumer pursuant to a contract that will automatically renew unless the consumer cancels the contract, shall— (1) notify, in the same manner as the consumer entered into the contract, the consumer of— (A) the first automatic renewal (and of each automatic renewal thereafter) not less than 7 days (or a longer time period as determined appropriate by the Commission) before the commencement of the renewal period; and (B) how the consumer may cancel the contract, which shall include— (i) an online mechanism for cancellation provided by the person; and (ii) a toll-free telephone number, email address, postal mail address, or other cost-effective, timely, and easy-to-use mechanism for cancellation provided by the person; (2) on an annual basis and notwithstanding the consumer’s consent to the initial term (or any subsequent term), obtain the consumer’s express informed consent to renew the contract before charging the consumer for the renewal; and (3) notwithstanding the consumer's consent to the initial term (or any subsequent term), in the event that the person has actual knowledge that the consumer has not used the good or service provided under the contract for a period of 6 consecutive months since the consumer's most recent express informed consent— (A) obtain the consumer's express informed consent to the automatic renewal before charging the consumer for the automatic renewal; and (B) notify the consumer that the consumer has a right to terminate the contract and receive a prorated refund for the remaining portion of contract. (c) Free trial A person who sells a good or service to a consumer pursuant to a contract that includes a free-to-pay conversion feature with a free trial period, shall— (1) notify, in the same manner as the consumer entered into the contract, the consumer of— (A) the automatic renewal not less than 7 days (or a longer time period as determined appropriate by the Commission) before the expiration of the free trial period; and (B) how the consumer may cancel the contract, which shall include— (i) an online mechanism for cancellation provided by the person; and (ii) a toll-free telephone number, email address, postal mail address, or other cost-effective, timely, and easy-to-use mechanism for cancellation provided by the person; and (2) notwithstanding the consumer’s consent to the free trial, obtain the consumer’s express informed consent to the automatic renewal not less than 7 days (or a longer time period as determined appropriate by the Commission) before the expiration of the free trial period and before charging the consumer for the automatic renewal. (d) Automatic renewal void In the case of a violation of subsection (a), (b), or (c)— (1) the applicable automatic renewal provision shall be void, and the contract shall terminate upon the occurrence of such violation; and (2) the person who violated subsection (a), (b), or (c) shall provide the consumer with a refund for all amounts paid by the consumer due to such violation. (e) Dark patterns With respect to a contract that includes a free-to-pay conversion or negative option feature or any other automatic renewal provision, a consumer's consent obtained through the use of dark patterns shall not be considered express informed consent. (f) Exemptions The requirements under subsections (a), (b), (c), and (d) shall not apply to a service contract or any other person or contract determined appropriate by the Commission. (g) Effective date The requirements under this section shall take effect on the date that is 1 year after the date of enactment of this Act. 3. Enforcement by the Commission (a) Unfair or deceptive acts or practices A violation of section 2 or a rule promulgated under this Act shall be treated as a violation of a rule defining an unfair or a deceptive act or practice under section 18(a)(1)(B) of the Federal Trade Commission Act ( 15 U.S.C. 57a(a)(1)(B) ). (b) Powers of the Commission (1) In general The Commission shall enforce this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms and provisions of the Federal Trade Commission Act ( 15 U.S.C. 41 et seq. ) were incorporated into and made a part of this Act. (2) Privileges and immunities Any person who violates section 2 or a rule promulgated under this Act shall be subject to the penalties and entitled to the privileges and immunities provided in the Federal Trade Commission Act ( 15 U.S.C. 41 et seq. ). (3) Authority preserved Nothing in this Act shall be construed to limit the authority of the Commission under any other provision of law. (4) Rulemaking The Commission shall promulgate in accordance with section 553 of title 5, United States Code, such rules as may be necessary to carry out this Act, or to prevent unfair or deceptive acts or practices regarding free trials, automatic renewals, or other contracts under which a consumer's silence or failure to take an affirmative action to reject goods or services or to cancel an agreement is interpreted by the seller as acceptance of the offer. 4. Definitions In this Act: (1) Commission The term Commission means the Federal Trade Commission. (2) Consumer The term consumer means any person who seeks or acquires, by purchase or lease, any goods or services. (3) Dark patterns The term dark patterns means a user interface that has the substantial effect of subverting or impairing user autonomy, decision making, or choice. (4) Free-to-pay conversion The term free-to-pay conversion has the meaning given that term in section 310.2 of title 16, Code of Federal Regulations. (5) Negative option feature The term negative option feature has the meaning given that term in section 310.2 of title 16, Code of Federal Regulations. (6) Service contract The term service contract means a contract or agreement for a separately stated consideration for any duration— (A) to perform the repair, replacement, or maintenance of property or indemnification for service repair, replacement, or maintenance for the operational or structural failure of any motor vehicle or residential or other property due to a defect in materials, workmanship, accidental damage from handling, or normal wear and tear; or (B) to indemnify for the same, including towing, rental, or emergency road service or road hazard protection, and which may provide for the service repair, replacement, or maintenance of property for damage resulting from power surges or interruption.