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Mastercard and State Law Updates

Marc Roth of Cobalt Law shares updates on Mastercard and two recent state law developments.

Mastercard update

Following my last alert, Mastercard did eventually respond to me, but with no substantive answer — just another Heisman push off. On March 10, they told me they will be “publishing further guidance in the near future and update the merchant community accordingly” and that “they are unable to provide any additional details to me directly.” To date (almost a month later), I haven’t seen anything.

Idaho SB 1298

Idaho SB 1298. Signed by Governor Brad Little on March 23, 2022. Effective January 1, 2023.

The law has limited applicability and requirements, but it does require two methods of cancellation. It applies only to agreements entered into via the internet to provide goods or services for a specified time and price that are automatically renewed at the end of a definite term for a subsequent term unless the consumer cancels the agreement.

Offer Terms. Requires clear and conspicuous (not defined) disclosure of the automatic subscription renewal terms and the methods the consumer may use to cancel the subscription.

Renewal Notice. Requires a notice where the subscription renews for a specified term of twelve months or more. The notice must clearly and conspicuously disclose (i) the goods or services to be delivered, (ii) the price to be charged, (iii) that the goods or services will be provided unless the consumer cancels, and (iv) at least two methods of cancellation, including at least one that is at no cost to the consumer. The notice must be sent between 30 and 60 days in advance of the date of the delivery or provision of goods or services.

Cancellation. Must provide a free online method to cancel the subscription and cancellation in the same manner that the consumer used to subscribe. If a phone number is provided for the purposes of cancellation, the number must be toll-free and prominently displayed in the disclosure.

The law applies to agreements entered into or renewed on and after January 1, 2023.

Virginia HB 78

Virginia HB 78. Approved by both houses, enrolled and sent to Governor Glenn Youngkin on March 22, 2022 for signature, where he must, by April 11, sign, veto, amend it, or do nothing, in which case it becomes law.

The bill will amend existing Virginia Code §§59.1-200 (general prohibited practices in connection with consumer transactions) and59.1-207.46 (automatic renewal law).

It’s pretty simple, actually. It requires sellers that make an automatic renewal or continuous service offer through an online website to make available a conspicuous online option to cancel future charges.

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