The UK’s new subscription contract regime will require traders to send consumers prescribed notices at three key points in the life of a subscription: before a renewal payment is taken, at the start of a renewal cooling-off period, and after a contract ends. In this third alert in our series on the new subscription contract rules, we set out what each notice must contain, when it must be sent and how it must be presented, together with the consequences of non-compliance and the practical steps businesses should now take.
Notification requirements
The Digital Markets, Competition and Consumers Act 2024 (“DMCCA”), together with the draft Consumer Subscription Contracts (Cancellation and Information) Regulations 2026 (which remain subject to parliamentary approval), requires traders to provide consumers with notices at several points during the subscription contract lifecycle. The following outlines the content and timing requirements of each of these three types of notices:
Reminder notices – before renewal payment
Traders must provide notices to consumers to remind them of an upcoming renewal payment under their subscription contract. Reminder notices must contain the following information, given all together:
- that the contract will automatically renew and renewal payments will be taken from the consumer, unless they take steps to end the contract;
- the amount of the renewal payment and the date the consumer becomes liable;
- the amount of the previous equivalent payment and, where the amount has increased, the amount of the increase;
- whether the consumer will need to make any further payments after becoming liable for renewal, along with information on the frequency and minimum amount of those payments and the amount of equivalent payments in the previous period and any increase;
- the minimum total amount that the consumer will be liable for if they do not end the contract before becoming liable for the renewal payment (or how that amount will be calculated, if it cannot reasonably be calculated in advance);
- the date the consumer will become liable for the next renewal payment after the upcoming one (or the date the contract ends if there will be no further renewal payment); and
- how the consumer can bring the subscription contract to an end to avoid liability for further payments (including any contact details the consumer needs to do so), along with the date by which the consumer must act to avoid liability.
Timing of reminder notices
Traders must send consumers a reminder notice before certain renewal payments fall due. How often reminders are required depends on how often payments fall due and whether there is a free or discounted period. Broadly, a reminder notice is required:
- for rolling subscriptions (e.g. weekly or monthly): roughly once every six months;
- for longer renewal periods: where payments are less frequent, before each renewal payment;
- for renewals onto a term of 12 months or more: two notices, a standard reminder and an additional, earlier one; and
- for free trials and introductory offers: before the consumer is first charged, or charged a higher price, at the end of the offer.
Traders must state in the key pre-contract information the period within which reminder notices will be sent, and each notice must then be sent within that period. The period must be reasonable when measured against the last date on which the consumer can end the contract to avoid the renewal payment, so that they have time to decide and to take the necessary steps. Where two notices are required, the additional notice must come earlier, at a time that is reasonable for alerting the consumer to the upcoming payment.
Cooling-off notices – start of a renewal cooling-off period
Consumers will have a 14-day cooling-off period to cancel a subscription without penalty at specified intervals, such as after a free or discounted concessionary period ends, or after the contract auto-renews onto a term of 12 months or more (a renewal cooling-off period does not arise on every renewal). A cooling-off notice must be provided by a trader on the first day of each renewal cooling-off period, or as soon as reasonably practicable afterwards, to remind consumers that they have this statutory 14-day cooling-off period to decide to cancel without penalty.
The notice must specify the following information separately from any other information (so it cannot include promotional material or be combined with a reminder notice):
- Cooling-off rights: that the contract is continuing, that the consumer has a right to cancel during the renewal cooling-off period and, if the consumer may lose that right, the circumstances in which that will happen;
- Timing: when the renewal cooling-off period begins and ends;
- How to cancel: how to exercise the cooling-off right;
- Consequences: the consequences of exercising this right, including refunds and the circumstances in which refunds will be reduced; and
- Returning goods (goods only): whether the consumer will be responsible for returning the goods and, for returnable goods that cannot normally be returned by post, the likely cost of the consumer returning them if exercising the cooling-off right after renewal.
End of contract notices – after exit or cancellation
Traders must send an end of contract notice when a consumer ends their subscription contract or cancels it during a cooling-off period.
The notice must state the date on which the contract ended or will end. It must be sent within 24 hours if the consumer ended the contract online, or within three working days if they used another method. If the consumer has overpaid, the trader must also refund the overpayment.
An end of contract notice is also required where a consumer cancels the contract because the trader has breached certain statutory implied terms.
Format of notices
Reminder notices, cooling-off notices and end of contract notices must be provided in writing on a durable medium and their purpose must be readily apparent to the consumer, using plain and clear language. A “durable medium” means any medium that is addressed personally to the consumer and allows them to store and later access the information unchanged, such as letters and emails; the draft guidance indicates that SMS or WhatsApp messages may also qualify where the consumer can retain and retrieve them. Expiring in-app messages/notifications which cannot be retained or recovered later are excluded.
The prescribed information for reminder notices and end of contract notices (as discussed above) must be displayed more prominently than any other information given within the same notice. In practice, this can be achieved by placing the prescribed information before any additional information and/or by using more prominent formatting to ensure the prescribed information comes to the attention of the consumer (e.g., using bold text or a larger font).
However, note that this prominence requirement is not specified for cooling-off notices. Under section 266(3)(b) DMCCA the cooling-off notice must be provided separately from any other information, which is confirmed by questions 26 and 27 of the FAQs section of the guidance. Therefore, cooling-off notices have a stricter separate information requirement than the prominence of display requirement for reminder and end of contract notices.
Consequences of non-compliance
Failure to provide a compliant reminder notice is a breach of a statutory implied term. It gives the consumer a right to cancel without penalty and, generally, to a refund of payments made from the date of the breach. The same applies if the trader specifies an unreasonable reminder period in the key pre-contract information. The consumer must exercise this right within 12 months, starting from the day after the relevant date (for a missing or defective reminder notice, the date the consumer became liable for the renewal payment concerned).
Separately, if a trader fails to provide a valid cooling-off notice, the renewal cooling-off period is extended until 14 days after the trader corrects the failure, up to a maximum of 12 months. It is therefore important that businesses ensure their notification systems operate effectively.
As the DMCCA places on traders the burden of proving that they provided the required notices, businesses should also ensure that they maintain reliable records of sent notices, including their content, date of provision and delivery method.
Additionally, failing to provide the statutory notices, or providing them in an incorrect or incomplete manner, may result in potential enforcement by the CMA. Businesses which are found to have infringed the consumer law regime could potentially face financial penalties of up to £300,000 or 10% of global turnover (whichever is higher).
Next steps
Given that the CMA continues to actively enforce its consumer powers to levy significant fines for non-compliance, businesses should ensure that they take action to assess their subscription notification systems. Baker McKenzie supports businesses with subscription contract risks and can advise on the content and form of traders’ notifications to consumers.
For more information, please reach out to the Baker McKenzie Consumer Law Team.
