Automatic Renewal Laws for Martial Arts Schools: The FTC, ROSCA and State Rules (2026)

The federal click-to-cancel rule never took effect, but recurring memberships are more regulated than ever. Federal law still applies to online sign-ups and bank drafts, and state automatic-renewal laws keep multiplying.

What happened to the FTC's click-to-cancel rule?

In 2024 the FTC adopted major amendments to its Negative Option Rule, widely called the click-to-cancel rule. The amended rule was published at 89 Fed. Reg. 90476 (Nov. 15, 2024). It had an effective date of January 14, 2025, and a compliance date for most provisions that was first set for May 14, 2025 and later moved to July 14, 2025. It would have reached most negative option programs, including gym-style memberships, and required simple cancellation through the same medium used to sign up.

On July 8, 2025, before that compliance date, the U.S. Court of Appeals for the Eighth Circuit vacated the amended rule in Custom Communications, Inc. v. FTC, 142 F.4th 1060 (8th Cir. 2025). The court held that the FTC failed to conduct the preliminary regulatory analysis required by section 22 of the FTC Act. The case was brought by industry petitioners, and the Health & Fitness Association and the International Franchise Association were among the amici supporting them.

The result: the 2024 amendments are not in force. Do not rely on any article, vendor or template that describes them as current law.

What has the FTC done since the vacatur?

The FTC has restarted the rulemaking process from an earlier stage. It sent a draft advance notice of proposed rulemaking (ANPRM) to the Office of Information and Regulatory Affairs on January 30, 2026, announced it on March 11, 2026, and published it in the Federal Register on March 13, 2026 (91 Fed. Reg. 12318, RIN 3084-AB54, Project No. P064202). Comments were due April 13, 2026. The ANPRM asks whether the rule should be amended, about enrollment and cancellation practices, about "save" offers, about whether to revive specific provisions of the vacated rule, and about exemptions.

An ANPRM imposes no obligations. Under section 18 of the FTC Act, a proposed rule and another round of comment would have to follow before any new rule could be adopted. As of October 10, 2026, our research did not locate a notice of proposed rulemaking. Check the Federal Register before relying on this statement.

Meanwhile, the FTC's original Negative Option Rule at 16 C.F.R. part 425 remains on the books. It governs prenotification negative option plans for goods and merchandise, the classic book-of-the-month model, and does not fit a typical martial arts membership. The FTC continues to bring cases under the FTC Act and ROSCA.

What does ROSCA require for online sign-ups?

The Restore Online Shoppers' Confidence Act (ROSCA), 15 U.S.C. §§ 8401-8405, is a statute, so the Eighth Circuit decision did not affect it. ROSCA makes it unlawful to charge a consumer for goods or services sold in a transaction effected on the Internet through a negative option feature unless the seller (1) clearly and conspicuously discloses all material terms before obtaining billing information, (2) obtains the consumer's express informed consent before charging, and (3) provides simple mechanisms to stop recurring charges (15 U.S.C. § 8403).

For a school, ROSCA applies when families enroll in a recurring or auto-renewing membership through your website, an online booking tool or an app. A violation is treated as a violation of an FTC trade regulation rule, which exposes the business to civil penalties (15 U.S.C. § 8404), and state attorneys general can sue under it too (15 U.S.C. § 8405).

Practical steps: show price, billing frequency, term, renewal terms and how to cancel next to the purchase button, before card entry. Use an unchecked box or separate click for consent to recurring billing. Offer an online way to cancel.

How do the EFT rules apply to monthly bank drafts?

If you or your billing company pull tuition from a family's bank account by ACH, the Electronic Fund Transfer Act and Regulation E apply. A preauthorized transfer from a consumer's account may be authorized only by a writing signed or similarly authenticated by the consumer, and the person obtaining the authorization must give the consumer a copy (15 U.S.C. § 1693e(a); 12 C.F.R. § 1005.10(b)). If the amount will vary from the previous transfer or the authorized amount, written notice of the amount and date is due at least 10 days before the transfer, unless the consumer chose range-based notice (12 C.F.R. § 1005.10(d)). The consumer can stop a preauthorized payment by notifying the bank at least three business days before it is scheduled (12 C.F.R. § 1005.10(c)).

Card billing is not covered by Regulation E's preauthorized transfer rules, but card network rules apply. Visa's rules, for example, require a simple cancellation procedure for recurring transactions and an online procedure if the order was accepted online (Visa Core Rules and Visa Product and Service Rules, 18 April 2026, Table 5-21). See our Cancellation and Refunds guide.

Which states have automatic renewal laws, and what do they require?

A large and growing number of states regulate automatic renewals. The table on this page lists laws we confirmed through official legislative or government sources, with dates of recent changes. It is not a complete 50-state list. Several other states are reported to have automatic renewal laws that we did not independently verify; they are listed in open questions.

Most state laws share a core set of duties: clear and conspicuous disclosure of renewal terms before the purchase; affirmative consent to the renewal terms; an acknowledgment the consumer can keep; an easy way to cancel, often online if the consumer signed up online; and advance notice before renewal for longer terms, commonly 30 to 60 days before the cancellation deadline for contracts of a year or more. Newer laws add annual reminders, rules on save offers, notice of price changes, and consent recordkeeping.

Scope varies. Some laws cover any consumer contract that renews. Florida's applies to service contracts that renew for more than a month and keep the contract in effect more than six months after it began (Fla. Stat. § 501.165). Idaho's applies to agreements entered into via the internet (Idaho Code § 48-603G). Maine's was limited to online subscriptions until 2025, when it was expanded to include health club memberships (10 M.R.S. § 1210-C, as amended by P.L. 2025, c. 376). A school that sells a month-to-month membership with no fixed term should check whether its state's law covers "continuous service" offers as well as renewals of fixed terms.

What changed in California on July 1, 2025?

California's Automatic Renewal Law (Cal. Bus. & Prof. Code § 17600 et seq.) is one of the most detailed. Assembly Bill 2863, signed September 24, 2024, amended it effective for contracts entered into, amended or extended on or after July 1, 2025. Based on published analyses of the bill, the main changes are:

• Express affirmative consent to the automatic renewal or continuous service terms themselves, not just to the overall agreement.
• Records verifying consent kept for at least three years, or one year after the contract ends, whichever is longer.
• Online cancellation through a prominently located direct link or button ("click to cancel"), with a parallel rule for phone sign-ups.
• Save or retention offers during cancellation allowed only if the consumer can still cancel immediately, such as a cancel button that stays visible.
• An annual reminder for renewing contracts, stating the service, the charge amount and frequency, and how to cancel.
• Notice 7 to 30 days before a price change takes effect, with cancellation instructions.

What does Connecticut's 2026 law require?

Connecticut amended its automatic renewal statute, Conn. Gen. Stat. § 42-158ff, through Public Act 25-44, section 7 (2025 Senate Bill 3, An Act Concerning Consumer Protection and Safety). The amendments took effect July 1, 2026. The Attorney General highlighted them in a press release dated July 16, 2026.

Under the amended statute and the Attorney General's summary, businesses with automatically renewing consumer contracts must send an annual reminder before renewal describing the goods or services, how often and how much the consumer will be charged, and how to cancel. Cancellation must be easy. Businesses may no longer require cancellation in person or by mail. A business with an online platform must offer a clear online cancellation option or a dedicated cancellation email; a business without one must provide a phone number. If a consumer leaves a voicemail asking to cancel, the business must process the cancellation or return the call within one business day. The amended text makes a violation an unfair trade practice under Conn. Gen. Stat. § 42-110b(a) and removes earlier language that said the section created no private right of action.

Connecticut schools must also comply with the state's separate health club statute, which has its own renewal and term rules. See the Connecticut state profile.

What other state changes took effect in 2025 and 2026?

Several other states changed their laws recently. The dates below come from official sources where noted, and otherwise from legal analyses we could not confirm against the enacted text.

• Minnesota: Minn. Stat. §§ 325G.56-325G.63, enacted in 2024 (2024 Minn. Laws ch. 114, art. 3), effective January 1, 2025 according to published analyses. Includes annual notice for ongoing subscriptions and limits on save offers.
• Colorado: Senate Bill 25-145 amended C.R.S. § 6-1-732. A one-step online cancellation link satisfies the cancellation duty. Reported effective dates: August 6, 2025 for cancellation provisions and February 16, 2026 for a broader consumer definition.
• Massachusetts: Attorney General regulations at 940 CMR 38.00, effective September 2, 2025 according to published analyses, require price and renewal disclosures and cancellation at least as easy as sign-up.
• New York: N.Y. Gen. Bus. Law § 527-a now requires affirmative consent to an increased price, or a right to cancel within at least 14 days after the first charge at the new price with a pro rata refund. Published analyses date the amendment to November 5, 2025. New York City's own click-to-cancel rule was reported to take effect October 1, 2026.
• Maine: P.L. 2025, c. 376 added health club memberships, required express consent through a check box or similar action, cancellation by the same method used to sign up, and a treble refund of unauthorized charges (10 M.R.S. §§ 1210-C, 1210-D). Published analyses report it applies to agreements entered into or renewed on or after January 1, 2026.
• Maryland: Senate Bill 49 (2025) takes effect June 1, 2026, per the Department of Legislative Services fiscal note, and makes violations unfair, abusive or deceptive trade practices under the Maryland Consumer Protection Act.
• Virginia: 2026 House Bill 1022 and Senate Bill 493 amended Va. Code §§ 59.1-207.45 to 59.1-207.49 effective July 1, 2026, requiring cancellation at least as easy as sign-up and stating that compliance with certain federal negative option provisions does not satisfy Virginia law.
• Louisiana: House Bill 750 became Act 830 of 2026, effective January 1, 2027, per the Louisiana Legislature.

Does any federal rule override state automatic renewal laws?

No. No single federal rule supersedes state automatic-renewal laws for martial arts memberships. The 2024 click-to-cancel rule was vacated, and the FTC's 2026 ANPRM imposes no duties. ROSCA sets a federal floor for online negative option sales, but we located no provision of ROSCA that displaces state automatic-renewal laws. Virginia's 2026 amendment says compliance with certain federal negative option provisions does not satisfy Virginia's own law.

In practice, a school must comply with ROSCA for online sign-ups, the EFT rules for bank drafts, the card network rules in its merchant agreement, and the automatic-renewal law of each state where it enrolls students. If you have locations or online students in several states, the simplest approach is to build one process that meets the strictest rules you face: express consent to renewal terms, a retained acknowledgment, advance renewal reminders, annual reminders, and cancellation online or by email without a phone call or visit.

Frequently asked questions

Is the FTC click-to-cancel rule in effect?

No. The Eighth Circuit vacated the 2024 amendments on July 8, 2025. The FTC published an advance notice of proposed rulemaking on March 13, 2026, with comments due April 13, 2026. As of October 10, 2026, we located no proposed or final replacement rule.

If the federal rule is gone, can I make families cancel in person?

Often not. Several state laws require online, email or phone cancellation and bar in-person-only cancellation, including Connecticut's 2026 amendment. Card network rules also require a simple cancellation procedure for recurring charges. ROSCA requires simple cancellation mechanisms for online sign-ups.

Does ROSCA apply to a paper contract signed at my front desk?

ROSCA covers transactions effected on the Internet through a negative option feature. A paper contract signed in person is generally outside it, but state automatic renewal and health club laws still apply.

My membership is month to month with no end date. Do renewal laws apply?

Many do. Several state laws cover continuous service offers that bill until cancelled, not only fixed terms that renew. Check the definitions in your state's law.

Do I have to send a reminder before every renewal?

It depends on the state and the term. Several laws require notice 30 to 60 days before the cancellation deadline for terms of a year or more, and California, Connecticut and Minnesota require annual reminders. Build your reminder schedule to meet the strictest state you operate in.

Does federal law preempt my state's automatic renewal law?

No single federal rule supersedes state automatic-renewal laws. You must comply with federal law and with each applicable state law at the same time.

Official sources

1. Custom Communications, Inc. v. FTC, No. 24-3137 (8th Cir. July 8, 2025) · U.S. Court of Appeals for the Eighth Circuit
2. Rule Concerning the Use of Prenotification Negative Option Plans, ANPRM, 91 Fed. Reg. 12318 (Mar. 13, 2026) · Federal Register / Federal Trade Commission
3. FTC Seeks Public Comment in Response to ANPRM Regarding Negative Option Marketing Practices (Mar. 2026) · Federal Trade Commission
4. 16 C.F.R. part 425 (Negative Option Rule, current text) · eCFR / Federal Trade Commission
5. Restore Online Shoppers' Confidence Act, 15 U.S.C. §§ 8401-8405 · U.S. Code (Office of the Law Revision Counsel)
6. 12 C.F.R. § 1005.10 (Regulation E, preauthorized transfers) · eCFR / Consumer Financial Protection Bureau
7. Conn. Gen. Stat. ch. 742d, § 42-158ff (2026 supplement) · Connecticut General Assembly
8. Attorney General Tong Highlights New Click to Cancel Consumer Protections (July 16, 2026) · Connecticut Office of the Attorney General
9. 10 M.R.S. § 1210-C · Maine Legislature, Office of the Revisor of Statutes
10. Minn. Stat. §§ 325G.56-325G.63 · Minnesota Office of the Revisor of Statutes
11. Va. Code § 59.1-207.46 · Virginia General Assembly (LIS)
12. 6 Del. C. ch. 27, subch. IV · Delaware General Assembly
13. D.C. Code § 28A-203 · Council of the District of Columbia
14. Fla. Stat. § 501.165 · The Florida Senate
15. Idaho Code § 48-603G · Idaho Legislature
16. 815 ILCS 601/10 · Illinois General Assembly
17. N.C. Gen. Stat. § 75-41 · North Carolina General Assembly
18. N.D. Cent. Code ch. 51-37 · North Dakota Legislative Branch
19. Or. Rev. Stat. ch. 646A (§§ 646A.292-646A.295) · Oregon Legislature
20. 9 V.S.A. § 2454a · Vermont General Assembly
21. Maryland S.B. 49 (2025) fiscal and policy note · Maryland Department of Legislative Services
22. Louisiana H.B. 750 (2026), Act 830 · Louisiana State Legislature
23. California's Latest Automatic Renewal Law Amendments Take Effect in July 2025 · Kilpatrick Townsend (law firm analysis) secondary source
24. Virginia Enacts Automatic Renewal Consumer Protection Law (May 2026) · Greenberg Traurig (law firm analysis) secondary source