The Department for Business, Innovation, Science and Trade has published its long-awaited draft guidance on the new subscription rules set out in the Digital Markets, Competition and Consumers Act 2024 (DMCCA), alongside the draft Consumer Subscription Contracts (Cancellation and Information) Regulations 2026 (SCRs). The final guidance will be published after the SCRs are made. The new rules apply to subscription contracts entered into on or after 1 January 2027, leaving businesses approximately two months to comply.
The guidance covers scope, exclusions and the new obligations. Although it provides fewer examples than hoped, it includes useful clarifications, particularly in the appended FAQs. Below is our guide to the key takeaways and what to do next.
Application of the new rules
The rules apply only to subscription contracts entered into on or after 1 January 2027; an existing contract does not become subject to them merely because it auto-renews after that date. The government nevertheless describes consistent protections for all consumers as "best practice". In our view, this is aspirational, as it is difficult to see how such "best practice" would or could be enforced, given the rules' clear limitation to new contracts. That said, many businesses may choose to apply the rules to all customers anyway, as running two customer journeys side by side may be hard to operate.
Pre-contract information
The two-tier "key" and "full" pre-contract information requirements are among the most operationally significant changes.
Key information covers payment frequency and amount, minimum total cost and reminder timeframes. It must be presented together, separately from full and other information, in plain language and as close as possible to the point at which the consumer commits. Crucially, for online sign-ups, it must sit within the purchase journey itself - no hiding it behind a link.
Full information includes the key information plus details such as the trader's identity and contact details, complaints policy and cooling-off rights. It may appear in the terms and conditions if kept together and not buried among other material. Most key and full information is a contractual term under the Consumer Rights Act 2015 and cannot be changed without the consumer's agreement.
The table below summarises the delivery requirements for each type of information across different contracting methods:
Key information | Full information | |
| Online | Must be directly given within the purchase journey | May be "made available" (e.g. via a prominent, direct and clearly labelled link) |
| Telephone | May be given orally, provided it is audible and comprehensible | May be "made available" (e.g. clearly directing the consumer to where it can be found, such as in their online account, before the contract is entered into) |
| In person | Must be given in writing on a durable medium (e.g. paper or email) | Must be given in writing on a durable medium (e.g. paper or email) |
If full information was not provided on a durable medium before contract, the trader must send it as soon as reasonably practicable afterwards (for instance, by email) and before supply begins.
Reminder notices
Reminder notices must tell consumers that a renewal payment is due and will be taken unless they stop auto-renewal. They are generally required: about every six months for contracts renewing for periods under 12 months; before a concessionary period ends; and twice (an earlier reminder and one closer to the renewal date) for contracts that renew for 12 months or more.
The guidance also highlights three important expectations:
- Durable medium. The reminder must be written and retrievable, for example on paper, by email or SMS; non-retrievable pop-ups or push notifications are insufficient.
- Clear purpose. The reminder's purpose must be immediately apparent. For email, the subject line should flag the upcoming payment.
- Prominence over marketing. Reminder content must be more prominent than accompanying marketing and is more likely to comply if presented first.
The guidance does not prescribe exact timing, but reminders must give consumers reasonable time to decide and act, fall within the timeframe stated in the key information and, where two are required, be appropriately sequenced. They cannot be combined with cooling-off notices.
Easy exit
The guidance distinguishes "bringing a contract to an end" (stopping auto-renewal or continuation, with the contract running to the end of the current period) from statutory "cancellation" during a cooling-off period or for breach of a relevant implied term, which ends the contract on cancellation. Ending a contract should be as easy as signing up. Exit arrangements must be straightforward and contain no unnecessary steps. Consumers who sign up online must be able to exit online, with instructions displayed where they are likely to find them.
Providing only an email address will not meet the requirement for a straightforward online route. However, a consumer who emails a clear statement that they want to end the contract will still have done so effectively.
Retention offers and feedback requests are allowed if they do not obstruct exit. The guidance gives limited detail: offers must not prolong or discourage exit, and feedback cannot be compulsory, though it may be optional during exit or requested afterwards.
After exit, the trader must give a written end-of-contract notice on a durable medium, stating when the contract ended or will end. The deadline is 24 hours for online exits or three working days beginning the day after notification for other methods. Marketing may be included if the required information is more prominent.
Six duties are implied contractual terms. Breach of four of them - key information, reminder notices, a reasonable reminder period and straightforward exit - give consumers a right to cancel, generally within 12 months of the relevant date.
The guidance also confirms that a contract term that makes the consumer liable for a renewal payment before the renewed contract period has started is of no effect.
Cooling-off rights
Two 14-day cooling-off periods allow consumers to cancel without penalty or reason:
- Initial cooling-off period: Begins when the contract is entered into and ends 14 days after the day on which the contract is entered into, or, where the contract is for non-bespoke or non-perishable goods, 14 days after the consumer receives the first supply of goods in full. Missing initial cooling-off information extends the period until 14 days after it is supplied, capped at 12 months.
- Renewal cooling-off period: Arises when a trial or concessionary period ends, or a contract renews for 12 months or more.
In relation to renewal cooling-off periods, the trader must give a cooling-off notice on the first day, or as soon as reasonably practicable afterwards. It must be written, on a durable medium, clearly identified and separate from other information, including marketing and reminders. Prescribed content includes that the contract is continuing, the cooling-off period's dates, how to cancel and the consequences, including refunds. A defective notice extends the period until 14 days after remedy, capped at 12 months. Initial cooling-off rights are covered in the full pre-contract information.
To cancel during a cooling-off period, the consumer must notify the trader of their decision. There is no prescribed form, but the guidance recommends retaining proof of the cancellation, as the burden of proof falls on the consumer. The trader must also send an end-of-contract notice once the right has been exercised.
Refunds
A trader may only make deductions from a refund if it has given the consumer the required cooling-off information: for the initial period, this is the full pre-contract information on cooling-off; for a renewal period, it is the renewal cooling-off notice.
Refund rules are product-specific:
- Services: Where the consumer agrees to the services starting immediately during the initial cooling-off period, refunds are on a proportionate basis. A proportionate basis for refunds also applies to cancellations during the renewal cooling-off period. The calculation need not be time-based, and traders may choose to refund in full.
- Goods: Returnable goods generally must be returned at the consumer's cost, unless the trader agrees otherwise or must collect them. Consumers remain liable for supplied perishable or bespoke goods, and relevant sealed goods once unsealed. Hired goods are treated as services.
- Digital content: The initial cooling-off right can be waived with express consent, but on renewal a proportionate refund applies on the same basis as services.
- Mixed contracts: The guidance offers limited assistance beyond confirming that contracts must be unpicked component by component.
Refunds must be made without undue delay and within 14 days, using the original payment method unless the consumer agrees otherwise. Cancelling the main subscription during the initial cooling-off period also automatically cancels any ancillary contracts, and the trader must inform any other trader involved.
Enforcement teeth
Non-compliance can be enforced through the courts by public enforcers, including Trading Standards and sector regulators, or directly by the Competition and Markets Authority. The CMA may determine breaches and impose penalties of up to £300,000 or 10% of global turnover, whichever is higher, without going to court. Failure to give initial cooling-off information for off-premises contracts is also a criminal offence.
The CMA has clarified that it will initially support compliance but may still consider conduct in the early months of the new regime as part of enforcement action. It will prioritise more egregious conduct, particularly where the existing law is already clear, and will consider genuine compliance efforts when deciding whether to intervene.
What next?
Businesses that have not yet started compliance work should do so now. Priorities include:
- mapping every subscription product and sign-up channel;
- redesigning purchase journeys, so key information appears within them, and exit and retention flows so they involve no unnecessary steps;
- building reminder, cooling-off and end-of-contract notices, and the systems that trigger them; and updating terms, refund logic and staff training, and documenting your compliance efforts.
Contact the team below to discuss the changes. Our support includes a subscriptions helpline for ad hoc questions during the development of compliance solutions. For more information and insights on subscriptions and other consumer law hot topics, visit our Consumer Law Hub.
