On 1 January 2027, the UK launches a new regime for consumer subscriptions. It comes from the Digital Markets, Competition and Consumers Act 2024 (DMCCA). The government has published draft regulations and guidance, so the details are now visible. The changes go well beyond updating terms and conditions. Businesses will also need to adjust sign-up pages, apps, billing, reminders, cancellation and record-keeping. Foreign companies that sell subscriptions to UK consumers should check the rules too.
Which subscriptions are covered
The rules apply when a consumer pays regularly for goods, services or digital content. The contract must renew or continue unless the consumer ends it. Free or discounted trials that turn into paid plans are covered as well. For example:
- streaming, software and digital content;
- gyms and other memberships;
- "subscribe and save" offers;
- regular deliveries of goods;
- free trials that convert into paid plans.
The rules apply even when a subscription is only a side product. However, some contracts are excluded. These include utilities, financial services, telecoms, accommodation, healthcare, travel and childcare. Certain charity memberships are also excluded, such as access to museums, heritage sites or performances run by the charity.
What about existing subscriptions
The regime applies to contracts made on or after 1 January 2027. An older contract does not become subject to it just because it renews later. However, the existing consumer rules still apply to it. So a practice that fails the new standard is not automatically lawful under the old one. Also, be careful with changes made after 1 January. A replacement agreement, a cancellation followed by a new sign-up, or a move to materially different terms may create a new contract.
1. Key information must be easy to see
Before the customer subscribes, the business must show the key terms clearly. These are:
- whether the contract renews automatically;
- how often and how much the customer pays;
- the minimum total cost;
- any minimum term or notice period;
- how and when to cancel;
- the cooling-off rights.
Online, this information should appear together, before purchase. Burying it in the terms or behind a vague link is not enough. By phone, the seller must explain it aloud. In person, it must be given in legible writing. Therefore, review the whole journey: ads, landing pages, checkout, app screens and call scripts.
2. Reminders before payments
Businesses must warn customers before certain payments. Depending on the product, a reminder is needed in three cases:
- before a free or discounted period turns into a full-price plan;
- in each six-month period of a rolling subscription;
- before a renewal of 12 months or more, plus an earlier extra reminder.
Each reminder must state the amount and the date. It must also explain how to cancel and leave enough time to act. It must reach the customer on a durable medium, such as email, paper or SMS. A disappearing push notification is generally not enough. As a result, CRM and billing systems must send the notices and store proof.
3. Cancellation must be simple
Customers must be able to cancel without needless steps or repeated contact. If they subscribed online, they must be able to cancel online. The guidance points to the same channel: if they signed up in an app, they should cancel in the app. A special "cancel" button is not required, and a clear web form can work. However, an email address alone generally will not. Businesses may ask for feedback or offer a discount, but only as an option that does not delay cancellation. After cancellation, the customer must receive written confirmation, and billing must stop. So test the whole process from start to finish.
4. Cooling-off periods and refunds
Customers generally get a 14-day cooling-off period after they subscribe. Another 14 days may start when a trial turns into a full-price plan. The same applies to a renewal for 12 months or more. Businesses must send the prescribed notices. If they do not, the period may be extended.
Refunds depend on the product. For goods, the customer is generally refunded and may have to return them. For services, the customer may pay for the part already supplied. For digital content, the result depends on whether the customer agreed to immediate supply. Therefore, set out the rules for each product separately.
5. Mistakes give customers extra rights
Some failures give customers a legal right to cancel. These include missing key information, missing or late reminders, and a difficult cancellation process. Future payments then fall away, and a refund may follow. If a customer has several rights, the rules generally apply the one that is best for them. So support teams must record why the customer is cancelling.
6. You must be able to prove compliance
In a dispute, the business generally has to prove that it gave the required information and notices. Therefore, keep the records:
- what the customer saw when subscribing;
- which version of the journey and terms applied;
- when and how each notice was sent;
- cancellation requests and the route used;
- end-of-contract messages;
- refunds and how they were calculated.
What to do now
- First, map your subscription products and decide which are covered.
- Then separate existing contracts from those made from 1 January 2027.
- Decide how to treat existing subscribers. Running two processes for long is costly.
- Review the full journey, from advertising to refund.
- Update CRM and billing, and test cancellation on the website, in the app and in support.
- Finally, train marketing, product, IT, compliance and support teams.
For many businesses, the simplest path is to apply the new standard to all subscribers. But the legal rights of old and new contracts may still differ. So think carefully before moving anyone to new terms.
Enforcement
There is no grace period. The CMA says it will first help businesses comply, and it will take real efforts into account. Even so, enforcement is possible from day one, especially for serious or clearly unlawful practices. The CMA can fine up to 10% of global annual turnover. The regulations are still in draft, so details may change before January.
This article is for information only and is not legal advice. If you have questions, the FBS team will be glad to help.