From one-click checkouts to autofilled payment fields, the modern payment experience is built on convenience. Consumers have come to expect that apps, websites, and even their mobile devices will seamlessly store and deploy their payment credentials with minimal friction. But beneath this ease lies a growing legal tension, particularly in subscriptions and automatic renewals programs, where sales and marketing laws require clear disclosures before obtaining the consumer’s billing information.
ROSCA Compliance and Subscription Disclosure Timing
The Federal Trade Commission’s (FTC) lawsuit against Uber Technologies illustrates how this tension plays out in practice. The case focuses on Uber’s “Uber One” subscription program and how subscription enrollment is embedded within an app ecosystem where users have already stored payment credentials for one-off transactions. Under the Restore Online Shoppers’ Confidence Act (ROSCA), material subscription terms must be disclosed before obtaining consumers’ billing information.
Continue Reading Stored Payment Credentials and ROSCA: Lessons from the FTC’s Uber Case
It’s no secret that automatic renewal (or continuity or negative option programs) are on many regulators hit lists. Regulators argue that consumers are often unaware that they have signed up for services or products for which they will be billed on a monthly basis unless and until they cancel, particularly when it involves a free trial period. In some cases cancellation may not always be easy and the billing descriptor that appears on the consumer’s credit card statement may differ significantly from the branded product or service name. Finally, otherwise busy consumers may simply forget about the upcoming renewal, particularly if the subscription term is lengthy.