[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2683 Introduced in House (IH)]
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116th CONGRESS
1st Session
H. R. 2683
To increase consumer protection with respect to negative option
agreements entered into on the Internet, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 10, 2019
Mr. Takano introduced the following bill; which was referred to the
Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To increase consumer protection with respect to negative option
agreements entered into on the Internet, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Unsubscribe Act of 2019''.
SEC. 2. INCREASED CONSUMER PROTECTION WITH RESPECT TO NEGATIVE OPTION
AGREEMENTS ENTERED INTO ON THE INTERNET.
(a) Cancellation of Negative Option Agreements.--No person may
enter into a negative option agreement on the Internet with any
consumer, unless the negative option agreement provides the consumer
with a mechanism to cancel the agreement in the same manner, and by the
same means, into which the agreement was entered.
(b) Requirements for Free-To-Pay Conversion Contracts.--
(1) In general.--It shall be unlawful for any person to
charge or attempt to charge any consumer's credit card, debit
card, bank account, or other financial account for any good or
service sold in a free-to-pay conversion contract entered into
on the Internet, unless--
(A) before obtaining the consumer's billing
information, the person has obtained the consumer's
express informed consent to enter into the contract and
has provided the consumer with a notification of the
terms of the contract, including the fact that--
(i) for an introductory period, the
consumer will receive the good or service at no
charge or for a nominal charge; and
(ii) after the introductory period, the
consumer will be charged or charged an
increased amount for the good or service; and
(B) before the initial charge or initial increase
after the introductory period, the person requires the
consumer to perform an additional affirmative action,
such as clicking on a confirmation button or checking a
box, which indicates the consumer's consent to be
charged the amount disclosed.
(2) Mandatory notifications.--After the introductory period
in a free-to-pay conversion contract entered into on the
Internet between any person and any consumer, and on a
quarterly basis while the contract remains in effect, the
person shall provide the consumer with a copy of the
notification of the terms of the contract.
(c) Mandatory Notifications With Respect to Other Negative Option
Agreements.--
(1) Automatic renewal contracts.--With respect to an
automatic renewal contract entered into on the Internet between
any person and any consumer--
(A) not later than 30 days before the end of the
initial fixed period in the contract, the person shall
provide the consumer with a notification of the terms
of the contract; and
(B) after the initial fixed period in the contract,
and on a quarterly basis while the contract remains in
effect, the person shall provide the consumer with a
copy of the notification of the terms of the contract.
(2) Continuity plan contracts.--With respect to a
continuity plan contract entered into on the Internet between
any person and any consumer, the person shall provide the
consumer with a copy of the notification of the terms of the
contract on a quarterly basis while the contract remains in
effect.
(d) Mandatory Notifications With Respect to Material Changes in
Terms of Negative Option Agreements.--In the case of a material change
in the terms of a negative option agreement entered into on the
Internet between any person and a consumer, the person shall provide
the consumer with a notification of the terms of the agreement as
changed before the change takes effect.
(e) Regulations.--The Federal Trade Commission may prescribe
regulations under section 553 of title 5, United States Code, to carry
out this Act.
SEC. 3. ENFORCEMENT.
(a) By Federal Trade Commission.--
(1) In general.--A violation of this Act or any regulation
prescribed under this Act shall be treated as a violation of a
rule issued under section 18(a)(1)(B) of the Federal Trade
Commission Act (15 U.S.C. 57a(a)(1)(B)) regarding unfair or
deceptive acts or practices. The Federal Trade Commission shall
enforce this Act in the same manner, by the same means, and
with the same jurisdiction, powers, and duties as though all
applicable terms and provisions of the Federal Trade Commission
Act (15 U.S.C. 41 et seq.) were incorporated into and made a
part of this Act.
(2) Penalties.--Any person who violates this Act or any
regulation prescribed under this Act shall be subject to the
penalties and entitled to the privileges and immunities
provided in the Federal Trade Commission Act as though all
applicable terms and provisions of the Federal Trade Commission
Act were incorporated in and made part of this Act.
(b) By State Attorneys General.--
(1) In general.--Except as provided in paragraph (5), the
attorney general of a State or other authorized State officer
alleging a violation of this Act or any regulation prescribed
under this Act that affects or may affect the State or the
residents of the State may bring an action on behalf of the
residents of the State in any United States district court for
the district in which the defendant is found, resides, or
transacts business, or wherever venue is proper under section
1391 of title 28, United States Code, to obtain appropriate
injunctive relief.
(2) Notice to commission required.--A State shall provide
prior written notice to the Federal Trade Commission of any
civil action brought under paragraph (1) with a copy of the
complaint for the civil action, except that if providing such
prior notice is not feasible for the State, the State shall
provide notice immediately upon instituting the civil action.
(3) Intervention by the commission.--The Federal Trade
Commission may intervene in a civil action brought under
paragraph (1) and upon intervening--
(A) may be heard on all matters arising in the
civil action; and
(B) may file petitions for appeal of a decision in
the civil action.
(4) Construction.--Nothing in this subsection shall be
construed--
(A) to prevent the attorney general of a State or
other authorized State officer from exercising the
powers conferred on the attorney general or other
authorized State officer by the laws of the State; or
(B) to prohibit the attorney general of a State or
other authorized State officer from proceeding in State
or Federal court on the basis of an alleged violation
of any civil or criminal statute of that State.
(5) Limitation.--An action may not be brought under this
subsection if, at the time the action is brought, the same
alleged violation is the subject of a pending action by the
Federal Trade Commission or the United States.
SEC. 4. DEFINITIONS.
In this Act:
(1) Automatic renewal contract.--The term ``automatic
renewal contract'' means a contract between any person and any
consumer for a good or service that is automatically renewed
after an initial fixed period, unless the consumer instructs
otherwise.
(2) Continuity plan contract.--The term ``continuity plan
contract'' means a contract between any person and any consumer
under which the consumer agrees to incur charges in exchange
for periodic shipments of goods or the provision of services,
unless the consumer instructs otherwise.
(3) Free-to-pay conversion contract.--The term ``free-to-
pay conversion contract'' means a contract between any person
and any consumer under which--
(A) for an introductory period, the consumer
receives a good or service at no charge or for a
nominal charge; and
(B) after the introductory period, the consumer is
charged or charged an increased amount for the good or
service.
(4) Negative option agreement.--The term ``negative option
agreement'' means--
(A) an automatic renewal contract;
(B) a continuity plan contract;
(C) a free-to-pay conversion contract;
(D) a pre-notification negative option plan
contract; or
(E) any combination of the contracts described in
subparagraphs (A) through (D).
(5) Notification.--The term ``notification'', when used
with respect to the terms of a contract, means a written
notification that clearly, conspicuously, and concisely states
all material terms of the contract, including information
regarding the cancellation process.
(6) Pre-notification negative option plan contract.--The
term ``pre-notification negative option plan contract'' means a
contract between any person and any consumer under which the
consumer receives periodic notices offering goods and, unless
the consumer specifically rejects the offer, the consumer
automatically receives the goods and incurs a charge for such
goods.
SEC. 5. EFFECTIVE DATE.
This Act shall apply with respect to contracts entered into after
the date that is 1 year after the date of the enactment of this Act.
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