There’s a Utah House bill for those auto-renewal subscriptions you may have forgotten

A bill discussed in a committee meeting wants to help you better handle subscriptions that come with auto-renewal contracts or free trial periods.

Have you ever signed up for a gym membership or a recurring online software subscription with the best of intentions and never used it? Month after month, you see the recurring charge in your bank statement and canceling it isn’t always a straightforward process. Sometimes you sign up for a free trial for a service and then never cancel it because you forgot when the trial period is up.

HB174, sponsored by Rep. Cheryl K. Acton, R-West Jordan, and Sen. Todd Weiler, R-Woods Cross, attempts to address this issue. The bill was discussed in the House Judiciary Committee Monday.

The bill deals with auto-renewal contracts and trial periods associated with contracts. If it passes, it would stipulate that the person who offers a product or service with an auto-renewal provision in the contract would have to disclose the renewal date, the total renewal cost and options for cancellation.

Acton said it’s a common situation “where you have a subscription online and it automatically renews, you forgot it was going to renew, and you want to stop that subscription.”

Saying that the process of dealing with these renewal bills can be “confusing,” Acton said sometimes you have to talk to representatives on the phone. If that’s the case and the bill passes, the person offering the contract would have to notify you about that process.

“Many reputable companies are already notifying that you are about to renew, if you’d like to cancel, this is the process,” Acton said. “Many are not. That’s where the problem comes in.”

This information would be disclosed to the consumer in text that is bigger and looks different than the surrounding text. The person offering the contract would have to disclose this information to the consumer between 30 to 60 days before the contract is set to auto-renew.

The bill states that these disclosures must be made “in print; in larger type than the surrounding text; in contrasting type, font, or color to surrounding text of the same size; or in a manner set off from the surrounding text of the same size by symbols or other marks that clearly call attention to the language’ or through audio, in a volume and cadence sufficient to readily audible and understandable.”

As for trial periods, the bill would require the person offering the contract to disclose the trial offer period expiration and how much money a person should expect to be charged for a good or service after the expiration date. This notice would have to be provided in text that looks different than the surrounding text at least three days before the day the trial period ends.

The exemptions listed in the bill were the subject of public discussion.

Before the public discussion, the exemptions were listed as insurance organizations under Title 31A Insurance Code or an affiliate of an insurance organization under that code. Acton also said that these regulations would not apply to business to business contracts, banking contracts or public utilities. She said the reason for these exemptions is because these kinds of contracts are already subject to regulations.

After the bill was open to initial public discussion, Rep. Tyler Clancy, R-Provo, motioned to amend the language of the bill so that the exemptions applied to all entitles regulated under Title 31A. Clancy said this amendment could help avoid potential legal challenges. Acton said she would support making that amendment to the bill.

The House Judiciary Committee decided to amend the language of the bill to include all entities regulated under Title 31A as exempted organizations.

The bill would also stipulate penalties for not following these regulations. The director of the Utah Division of Consumer Protection could impose a fine of up to $2,500 for each violation.

The amendment bill was recommended favorably by the committee. Following favorable recommendations, bill can be debated in open session. It would require a minimum of 38 votes from the House and 15 votes from the Senate to pass.

If the bill passes, it would take effect on Jan. 1, 2025.