New York City has adopted a new rule that bans companies from using deceptive subscriptions to trap customers into paying for gym memberships, streaming services, and other recurring charges.
The rule, which takes effect on 1 October, promises hefty fines and aggressive enforcement for violators. Companies that do not provide a simple way to cancel could pay $525 per user subscription, back fees, and additional fines.
The city is also targeting so-called “junk fees” that raise the final price of everything from apartments to sporting events. A proposed rule would require sellers to “advertise the total price for any good or service, including all mandatory additional charges and fees, up front.”
New York is the first US city to implement such a ban.
Why It Matters
“People shouldn’t have to wait on hold for half an hour or send a certified letter or show up to a store in person in order to cancel a subscription, said Samuel AA Levine, the city’s commissioner of consumer and worker protection.
Companies make billions a year in automatic subscription renewals that consumers do not want or do not know they have. The subscription rule could save New Yorkers alone as much as $162.5 million per year, according to the Roosevelt Institute.
The proposed fee rule could have an especially wide impact on New York’s expensive housing market, where about 70% of residents rent. Apartment renters face add-on fees such as “boiler management” and “lifestyle” charges that make true rental costs hundreds of dollars higher than stated prices.
The Political Context
The moves are part of an aggressive push by Mayor Zohran Mamdani and Levine to rein in what they see as predatory corporate malpractice nationwide. Levine, a former head of consumer protection at the Federal Trade Commission, criticized the Reagan-era deregulation that he says allowed deceptive pricing to flourish.
“In the dawn of the Reagan era, the FTC and others in Washington said expressly that markets could correct themselves, regulate themselves,” Levine said. “What it has gotten us is 40 years of deceptive pricing.”
The new rule is the Mamdani administration’s latest attempt to address the affordability crisis after heavily campaigning on making the city cheaper for residents.
Opposition and Challenges
Bans on junk fees and subscription traps have been fought aggressively by industry groups. When the Biden administration introduced a junk fee rule in 2024, the US Chamber of Commerce argued it was “an attempt to micromanage businesses’ pricing structures.”
A national click-to-cancel rule introduced by the Biden administration was struck down by a federal judge in 2025, days before it was set to go into effect. The Trump administration’s FTC plans to pass a similar rule in the coming months.
The Bottom Line
New York City has adopted a rule banning deceptive subscription practices and targeting junk fees, becoming the first US city to do so. The rule takes effect on 1 October, with fines of up to $525 per user subscription. A proposed junk fee rule would require sellers to display total prices upfront, including mandatory fees. The moves are part of Mayor Zohran Mamdani’s push to address the affordability crisis. Industry groups have opposed similar measures in the past.
