Senate bill would require pro rata refunds for early cancellation of digital subscriptions

Senate Bill 5207 would require providers of electronic media services to refund consumers on a pro rata basis for early cancellations of term subscriptions. Staff described the bill as addressing consumer complaints about annual subscriptions and the lack of proration when consumers stop using a service mid-term.

Clint McCarthy, staff, said the bill directs electronic-media services—defined to include commercial services providing music, news, software, games or other entertainment—to provide pro rata refunds when requested. The bill disclaims a private right of action and instead makes violations subject to enforcement under the Consumer Protection Act by the attorney general. Staff said a fiscal note has been requested.

Senator Drew MacEwen, prime sponsor, framed the bill as addressing common consumer experience and noted the Federal Trade Commission’s recently effective “click to cancel” rule requiring easy cancellation mechanisms, while saying the FTC rule is silent on refunds. MacEwen described examples of consumers on annual plans who dispose of equipment mid-year and receive no proration; he said he was “open to amendments that might make the bill easier to work, but not weaken the bill.”

Industry and stakeholder witnesses raised clarifying concerns. Representatives of newspaper and publishing associations told the committee they are seeking clarification and may ask to exclude news subscriptions from the bill’s scope, saying many newspaper subscriptions are annual and long-standing. Association Washington Business staff said members had mechanical concerns and would follow up with the sponsor.

The committee opened and closed public testimony on the bill without taking a vote at the hearing.