The laws pertaining to contracts that include automatic renewal are still unclear in Vermont and the District of Columbia. To remind you, both jurisdictions enacted laws that would require an opt-in affirmative acceptance of the automatic renewal features of a contract – although in DC this opt-in requirement is only for a free to pay or free trial offer. Vt law is scheduled to go into effect on July 1, 2019. The DC law already technically went into effect by operation of the mayor signing it, but DC apparently has no funds or personnel to enforce it.

Here are the details:

Vermont

To date, a proposed bill amending the law, which negated that additional opt-in requirement, passed the house and is up for consideration at the Senate level.

Please note that this bill amending the law, if enacted, also has a new additional requirement requiring that consumers who sign up online have an option to cancel online. The new proposed language states: “if the consumer accepted the contract online, [the seller must] permit the consumer to terminate the contract exclusively online, which may include a termination e-mail formatted and provided by the seller … that the consumer can send without additional information.” [emphasis added].

This requirement is similar to that already required in California but for one very important difference: the law in CA only requires that the seller allow the consumer to “terminate the automatic renewal or continuous service exclusively online” which is different than enabling the consumer to cancel the entire contract online (which would often require that a pro-rata refund be provided once the contract is canceled).

The law requires renewal notices for any terms renewing for longer than one month.

Do not forget VT’s requirement that the automatic terms of the offer be in bold type. 

District of Columbia

In addition to the requirement for a “double opt-in” for any free to pay or free trial, DC law also requires that renewal notices be sent for any contract automatically renewing for “one month or more” – which would require a notice at renewal after the initial term and then annually thereafter even for monthly recurring terms.

Also, the law requires that renewal notices which are sent via email must include a hyperlink to enable consumers to cancel the automatic renewal (effectively requiring an online cancelation of the automatic renewal). As of now, my understanding is that DC does not have the funds to enforce this new law and this will not change until its next budget process in October at the earliest. However, the law is technically in effect and although it is unknown if and when it will ever be enforced, the question also remains whether any violations of the law today could be part of an enforcement action at a later date.

Takeaway:  If you are not willing to take any risks adhering to the new laws is the only action to take. In addition, even if you are willing to take some risks while anticipating some changes will go into effect, certain requirements are likely to remain. At the very least, I recommend building into your order path and cancelation systems ways to comply with these laws if they are enforced.