California’s revamped Automatic Renewal Law (often called “CARL”, CA Business & Profession Code section 17600) takes effect July 1, 2025, bringing large changes to consumer protections for subscriptions, trials, and recurring payments. 

CARL is California’s consumer law regulating automatic renewals and continuous service agreements, now expanded to include free trials that roll into paid subscriptions. It requires businesses disclose terms clearly and enable easy cancellations as easy as the means used by customers to sign up. The legislature intent was to end the practice of ongoing charges of consumer credit or debit cards without the consumers explicit consent. 

How California Auto-Renewal Law (CARL) Works 

CARL covers free-to-pay conversions, or subscriptions that start with a free period and then convert to a paid plan if not cancelled.  Examples include an offer for 30 or 90 free days of a service that continue as a month to month or yearly renewal. 

CARL will apply to any contract entered into, extended, or amended after July 1st 2025. CARL requires explicit clear express consent of the renewal terms, and businesses must retain proof of the consent for 3 years or 1 year after termination. 

Before enrolling members to a paid subscription service, businesses must display to customers 

• That the plan auto-renews (until cancelled) 
• Price 
• Frequency of renewal and term length 
• How to cancel instructions 

All this information must be made visually prominent near any consent feature. 

Easy of Cancellation 

California law requires that customers have a path as easy to cancel as one used to sign up. Previously dark patterns became common among online vendors as a means to lengthen the process to cancel services, which in turn lead to customers quitting the cancellation process. A dark pattern is when a website hides the options to cancel in plain text, makes you take extra steps or load many screens to cancel, and convert free services to paid services without notice. 

As of July 1st, 2025, service providers of automatic renewal services must offer  

• A permanent click to cancel link 
• Any retention incentives must be displayed with a clear and obvious cancel button or option 
• For phone cancellations: Accept toll-free calls promptly 
• For phone cancellations: Honor voicemail cancels within 1 business day 
• The path to cancel must be as easy as signing up 

Express Affirmative Consent 

Businesses must obtain “express affirmative consent” to auto-renew or continue services. This requirement is in addition to previous existing obligations to obtain consumers affirmative consent to the agreement which contains auto-renewal terms. 

Businesses must keep the record of consent for either 3 years or 1 year after cancellation, whichever is longer. 

Click to Cancel 

If a consumer attempts to cancel a subscription online, a business pay present consumers with a discount offer, or a benefit to maintain service (such as an upgrade), or include information about the potential downsides of cancellation, but to do so the company must offer a simultaneous direct link or button “click to cancel”. Gone are the days of having to navigate multiple screens of retention offers, or having cancel buttons hidden in plain text. 

CARL Notices and Reminders 

The CA law also requires businesses notify customers of any changes to the auto-renewal plans, the notice is to between 7 and 30 days before the change goes into effect. Businesses must send annual reminders, even for multi year services that are not subject to renewal that year, that include the cancellation mechanism. 

Notices should be provided through the same medium used to obtain initial customer consent, or the medium consumers are used to interacting with the service provider. 

Consumer Lawsuit 

While the law does not allow consumers to sue under the new business code, existing law allows that consumers with economic injuries can sue regarding unlawful automatic renewal processes that cost consumers money.  A consumer that had an auto-renewal occur that they would have cancelled is an example of someone with an economic injury.   

Consumer Attorneys 

If you wish to speak with a consumer attorney, contact one of Schneider Wallace’s five offices in San Francisco Bay Area in California, Los Angeles, Washington, D.C. or Houston, Texas to schedule an appointment with our experienced trial lawyers. We are a national firm and, by partnering with local firms, we are able to assist clients in any jurisdiction.