,,ii #aaith ,,congress #ast ,session ,s4 #bbec ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,july #aj1 #bjbe,mr4 ,schatz 7for himself and ,mr4 ,kennedy7 introduced the following bill2 which was read twice and referred to the ,committee on ,commerce1 ,science1 and ,transportation ,a ,,bill ,to increase consumer protection with respect to negative options in all media1 including on the internet1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,unsubscribe ,act of #bjbe4 #b4 ,increased consumer protection with respect to negative options 7a7 ,disclosure of negative options ,it shall be unlawful for any merchant of record to charge or attempt to charge a credit card1 debit card1 bank account1 or other financial account of any consumer1 or otherwise receive payment from any consumer1 through a negative option1 unless the merchant of record clearly and conspicuously discloses all material terms of the contract involved before receiving payment or charging the consumer1 or otherwise receiving payment1 through such negative option4 7b7 ,express informed consent for negative options 7#a7 ,requirement ,it shall be unlawful for any merchant of record to charge or attempt to charge a credit card1 debit card1 bank account1 or other financial account of any consumer1 or otherwise receive payment from any consumer1 through a negative option1 unless the merchant of record obtains the express informed consent of the consumer before receiving payment or charging the consumer1 or otherwise receiving payment1 through such negative option4 7#b7 ,duration ,a merchant of record shall keep or maintain verification of the express informed consent obtained pursuant to paragraph 7#a7 for not fewer than #c years1 unless such merchant of record demonstrates by a preponderance of the evidence that the merchant of record uses processes that ensure a consumer may not technologically complete a transaction without such express informed consent4 7c7 ,term limitation for negative option contracts ,after the expiration of a preliminary period1 it shall be unlawful for any merchant of record to automatically renew or otherwise continue a negative option contract with any consumer for a period that is greater than the length of the preliminary period1 unless such merchant of record1 at the time of such expiration1 obtains the express informed consent of the consumer to renew or otherwise continue such negative option contract4 7d7 ,cancellation of negative option contracts 7#a7 ,online merchants ,in the case of a negative option contract that is entered into electronically1 it shall be unlawful for any merchant of record to enter into such negative option contract with any consumer unless such merchant of record provides to the consumer a simple mechanism1 including a direct link to an electronic form1 that enables the consumer to submit a request to cancel such negative option contract without requiring the consumer to take additional steps by any means other than electronically4 7#b7 ,other merchants ,in the case of a negative option contract that is entered into through means other than electronically1 it shall be unlawful for any merchant of record to enter into such negative option contract with any consumer unless such negative option contract provides the consumer with a simple mechanism for cancellation1 in the same manner1 and by the same means1 as such negative option contract was entered into1 or1 if not practicable1 through some other simple mechanism for cancellation4 7e7 ,requirements for free-,to-,pay conversion contracts ,it shall be unlawful for any merchant of record to charge or attempt to charge a credit card1 debit card1 bank account1 or other financial account of any consumer for any good or service sold under a free-to-pay conversion contract1 unless each of the following is met3 7#a7 ,before completing the financial transaction1 or otherwise receiving payment1 the merchant of record provides the consumer with a notification of the terms of the negative option contract and obtains the express informed consent of the consumer to such terms1 including the following terms3 7,a7 ,for an introductory period1 the consumer will receive the good or service at no cost or for a discounted cost4 7,b7 ,the amount the consumer will be charged or otherwise required to pay for the introductory period4 7,c7 ,the amount the consumer will be charged or otherwise required to pay1 on a recurring basis1 starting with the first financial transaction after the introductory period4 7,d7 ,the total cost 7or range of costs7 the consumer will be charged or otherwise required to pay through the entire term of such contract 7if such term is less than #ab months7 or cost information that enables the consumer to determine the total cost for the subsequent #ab-month period1 to the extent known4 7#b7 ,before the first charge1 payment1 or price increase after the introductory period1 the merchant of record provides notification to the consumer about the upcoming charge1 payment1 or increase and provides the consumer with-- 7,a7 the terms of the negative option contract1 including the length of time required for the merchant of record to complete any cancellation request2 and 7,b7 direct access to information about the simple mechanism for cancellation4 7f7 ,other notification requirements for negative option contracts 7#a7 ,general notification and access ,with respect to any negative option contract entered into by a merchant of record and a consumer1 the merchant of record1 at regular intervals as determined by the ,commission 7but not less frequently than annually7 while such negative option contract remains in effect1 shall provide the consumer with-- 7,a7 a notification of the terms of such negative option contract2 and 7,b7 direct access to information about the simple mechanism for cancellation4 7#b7 ,additional notification and access ,if a negative option contract specifies a period of time during which the merchant of record shall complete a cancellation request1 not fewer than #b but not more than #g days before the last day on which the consumer may cancel such negative option contract without incurring additional charges1 the merchant of record shall provide the consumer with the notification and access required by paragraph 7#a74 #c4 ,enforcement 7a7 ,enforcement by the ,federal ,trade ,commission 7#a7 ,unfair or deceptive acts or practices ,a violation of this ,act or a regulation promulgated thereunder shall be treated as a violation of a rule defining an unfair or deceptive act or practice under section #ah7;a77#a77;,b7 of the ,federal ,trade ,commission ,act 7#ae ,u4,s4,c4 #eg;a7a77#a77;,b774 7#b7 ,powers of the ,commission 7,a7 ,in general ,the ,commission shall enforce this ,act in the same manner1 by the same means1 and with the same jurisdiction1 powers1 and duties as though all applicable terms and provisions of the ,federal ,trade ,commission ,act 7#ae ,u4,s4,c4 #da et seq47 were incorporated into and made a part of this ,act4 7,b7 ,privileges and immunities ,any person who violates this ,act or a regulation promulgated thereunder shall be subject to the penalties and entitled to the privileges and immunities provided in the ,federal ,trade ,commission ,act 7#ae ,u4,s4,c4 #da et seq474 7,c7 ,authority preserved ,nothing in this ,act shall be construed to limit the authority of the ,commission under any other provision of law4 7,d7 ,rulemaking ,the ,commission shall promulgate in accordance with section #eec of title #e1 ,united ,states ,code1 such rules as may be necessary to carry out this ,act4 7b7 ,enforcement by ,states 7#a7 ,in general ,if the attorney general of a ,state1 or an official or agency of a ,state1 has reason to believe that an interest of the residents of the ,state has been or is being threatened or adversely affected by a practice that violates this ,act1 the ,state may bring a civil action on behalf of the residents of the ,state in an appropriate district court of the ,united ,states to obtain appropriate relief4 7#b7 ,rights of the ,commission 7,a7 ,notice to the ,commission 7i7 ,in general ,except as provided in clause 7iii71 an attorney general1 official1 or agency of a ,state1 before initiating a civil action under paragraph 7#a71 shall provide a written notice to the ,commission that the attorney general1 official1 or agency intends to bring such civil action4 7ii7 ,contents ,the notice required by clause 7i7 shall include a copy of the complaint to be filed to initiate the civil action4 7iii7 ,exception ,if it is not feasible for an attorney general1 official1 or agency of a ,state to provide the notice required by clause 7i7 before initiating a civil action under paragraph 7#a71 the attorney general1 official1 or agency shall provide such notice to the ,commission immediately upon instituting the civil action4 7,b7 ,intervention by the ,commission ,the ,commission may-- 7i7 intervene in any civil action brought by an attorney general1 official1 or agency of a ,state under paragraph 7#a72 and 7ii7 upon intervening-- 7,i7 be heard on all matters arising in the civil action2 and 7,,ii7 appeal a decision in the civil action4 7,c7 ,limitation on ,state action while ,federal action is pending ,if the ,commission or the ,attorney ,general of the ,united ,states has instituted a civil action for violation of this ,act 7referred to in this subparagraph as the ,federal action71 no ,state attorney general1 official1 or agency may bring an action under paragraph 7#a7 during the pendency of the ,federal action against any defendant named in the complaint in the ,federal action for any violation of such ,act alleged in such complaint4 7#c7 ,rule of construction ,nothing in this subsection may be construed to prevent an attorney general1 official1 or agency of a ,state from exercising the powers conferred on the attorney general1 official1 or agency by the laws of the ,state to conduct investigations1 to administer oaths or affirmations1 or to compel the attendance of witnesses or the production of documentary or other evidence4 #d4 ,preemption of directly conflicting ,state laws 7a7 ,in general ,nothing in this ,act may be construed to preempt1 displace1 or supplant any ,state law1 except to the extent that a provision of ,state law conflicts with a provision of this ,act1 and then only to the extent of the conflict4 7b7 ,greater protection under ,state law ,for purposes of this section1 a provision of ,state law does not conflict with a provision of this ,act if such provision of ,state law provides additional protections to consumers protected under this ,act4 7c7 ,conflicting time frames ,any difference between ,federal and ,state law in the time frame in which a requirement imposed on a person shall be met shall be considered a conflict for purposes of subsection 7a74 #e4 ,definitions ,in this ,act3 7#a7 ,automatic renewal contract ,the term automatic renewal contract means a contract between any merchant of record and any consumer for the sale of goods or services that is automatically renewed after a preliminary period1 unless the consumer instructs otherwise4 7#b7 ,commission ,the term ,commission means the ,federal ,trade ,commission4 7#c7 ,continuity plan contract ,the term continuity plan contract means a contract between any merchant of record and any consumer under which the consumer agrees to pay for periodic shipments of goods or the provision of services1 unless the consumer instructs otherwise4 7#d7 ,express informed consent 7,a7 ,in general ,the term express informed consent means1 with respect to an offer or agreement for the sale of goods or services that includes a negative option1 an affirmative action taken by a consumer1 including clicking on a confirmation button or checking a box1 that-- 7i7 indicates the unambiguous consent of the consumer to the negative option2 and 7ii7 is separate and apart from any action taken by the consumer to indicate the initial consent of the consumer to all of the material terms of the offer or agreement 7including to be charged for the preliminary period71 but may occur at the same time as such initial consent4 7,b7 ,exclusions ,the term express informed consent shall not include-- 7i7 consent that is inferred through the inactivity or silence of a consumer or the use of pre-checked boxes with respect to an initial charge or any recurring charge2 or 7ii7 consent obtained through a user interface designed or manipulated to have the substantial effect of subverting or impairing user autonomy1 decision-making1 or choice4 7#e7 ,free-to-pay conversion contract ,the term free-to-pay conversion contract means a contract for the sale of goods or services between any merchant of record and any consumer that includes an introductory period4 7#f7 ,introductory period ,the term introductory period means a preliminary period of a contract for the sale of goods or services where-- 7,a7 during such period1 the consumer receives a good or service at no charge or for a discounted cost2 and 7,b7 at the expiration of such period1 the amount the consumer will be charged or otherwise be required to pay for the good or service is increased4 7#g7 ,merchant of record ,the term merchant of record means a person who enters into a financial contract with a consumer4 7#h7 ,negative option ,the term negative option means a provision of an offer or agreement for the sale of goods or services under which the silence of a consumer or failure by a consumer to take an affirmative action to reject the goods or services or to cancel the agreement is interpreted by the seller as acceptance of the offer or renewal of the agreement4 7#i7 ,negative option contract ,the term negative option contract means a contract that includes a negative option1 including-- 7,a7 an automatic renewal contract2 7,b7 a continuity plan contract2 7,c7 a free-to-pay conversion contract2 7,d7 a pre-notification negative option plan contract2 and 7,e7 any combination of the contracts described in subparagraphs 7,a7 through 7,d74 7#aj7 ,notification ,the term notification1 when used with respect to the terms of a contract1 means a written notification that clearly1 conspicuously1 and concisely states all material terms of the negative option1 including information regarding the simple mechanism for cancellation and the length of time required for a merchant of record to complete any cancellation request4 7#aa7 ,preliminary period ,the term preliminary period means the period of a negative option contract prior to the date on which a negative option takes effect4 7#ab7 ,pre-notification negative option plan contract ,the term pre-notification negative option plan contract means a contract between any merchant of record and any consumer under which the consumer receives periodic notices offering goods or services and1 unless the consumer specifically rejects the offer1 the consumer automatically receives the goods and services and agrees to pay for such goods and services4 7#ac7 ,simple mechanism ,the term simple mechanism means the term described in section #dbe4f of title #af1 ,code of ,federal ,regulations1 or any successor regulation4 #f4 ,effective date ,this ,act shall apply with respect to contracts entered into or amended after the date that is #a year after the date of the enactment of this ,act4