Subscription rules brought forward: what businesses need to do before January 2027

Prime Minister Andy Burnham has confirmed that new "easy to exit" subscription rules will come into force from January 2027, bringing forward the expected timetable and shortening the implementation window for businesses.

Ministers say the changes will help stop consumers paying for services they no longer want, while creating a more level playing field for firms that already treat customers fairly.

The reforms sit within the Digital Markets, Competition and Consumers Act 2024. Under the new regime, businesses offering subscriptions will need to provide clearer information before customers sign up, send regular reminders ahead of renewals, and make cancellation quick, simple and free from unnecessary barriers.

Businesses will also need to set out key pre-contract information upfront, including renewal terms and pricing, rather than relying on information buried in the small print. Reminder notices must be sent before subscriptions renew or a free or discounted trial converts into a paid plan, helping to prevent customers being charged for services they no longer want or did not expect to continue.

The most significant change concerns cancellation. Subscriptions must be as easy to leave as they are to join, with no more forcing customers through lengthy phone calls or hard-to-find account settings. Customers who sign up online must also be able to cancel online. The existing 14-day cooling-off period for new sign-ups will remain and apply regardless of how the subscription was purchased. A further 14-day cooling-off period will apply when a free or discounted trial ends, or when a contract lasting 12 months or more automatically renews, giving consumers an additional opportunity to cancel after renewal has taken effect. Some cultural and heritage memberships will be exempt.

What should businesses do now?

Businesses that rely on subscription models should not leave preparations until the last minute. Now is the time to review the entire customer journey, from marketing and sign-up through to billing, renewal and cancellation, to identify where changes may be needed.

This includes:

· Ensuring pre-contract information clearly sets out pricing, contract duration, renewal terms and any changes following an introductory offer

· Planning compliant reminder notices and checking systems can issue them at the correct time

· Testing cancellation processes to ensure they are as straightforward as the sign-up journey, particularly for online customers

· Reviewing promotional pricing to ensure claims are accurate and not misleading

· Updating terms and conditions, internal procedures and staff training

The stakes for getting this wrong are high. The Competition and Markets Authority has direct enforcement powers under the Act and can fine businesses up to £300,000 or 10% of global annual turnover, whichever is higher, for breaches of consumer protection law, with further penalties available for continued non-compliance.

Help is at hand

LCF Law's Commercial & Digital team is helping businesses prepare for the changes by reviewing subscription models, terms and conditions, renewal communications and cancellation processes to ensure compliance ahead of the January 2027 deadline.