SB3447 102ND GENERAL ASSEMBLY

LRB102 23488 SPS 32664 b

102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB3447

Introduced 1/18/2022, by Sen. Suzy Glowiak Hilton

SYNOPSIS AS INTRODUCED:

815 ILCS 601/5
815 ILCS 601/10

Amends the Automatic Contract Renewal Act. Provides that the clear and conspicuous disclosure of an automatic renewal clause displayed during the contract formation process must require the consumer to affirmatively consent to the renewal terms. Provides for additional notice requirements concerning contracts that automatically renew for a specified term of more than one month unless the consumer cancels the contract. Provides for additional notice requirements concerning contracts that allow the consumer to accept a free gift or trial as part of an automatic renewal offer before the consumer makes any payment, or where such contract entitles the consumer to an introductory reduced, promotional, or discounted rate before the customer begins paying the full rate. Provides that a person, firm, partnership, association, or corporation that allows consumers to accept an automatic renewal or continuous service offer online shall allow a consumer to terminate the automatic renewal or continuous service exclusively online, at will, and without engaging any further steps that obstruct or delay the consumer's ability to terminate the automatic renewal or continuous service immediately. Defines "clear and conspicuous".

A BILL FOR

AN ACT concerning business.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Automatic Contract Renewal Act is amended by changing Sections 5 and 10 as follows:

(815 ILCS 601/5)

Sec. 5. Definitions. In this Act:

"Clear and conspicuous" means in larger type than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same size, or set off from the surrounding text of the same size by symbols or other marks, in a manner that clearly calls attention to the language. In the case of an audio disclosure, "clear and conspicuous" means in a volume and cadence sufficient to be readily audible and understandable.

"Contract" means a written agreement between 2 or more parties.

"Parties" includes individuals and other legal entities, but does not include the federal government, this State or another state, or a unit of local government.

(Source: P.A. 101-412, eff. 8-16-19; 102-558, eff. 8-20-21.)

(815 ILCS 601/10)

Sec. 10. Automatic renewal; requirements.

(a) Any person, firm, partnership, association, or corporation that sells or offers to sell any products or services to a consumer pursuant to a contract, where such contract automatically renews unless the consumer cancels the contract, shall disclose the automatic renewal clause clearly and conspicuously both in the contract and during the process by which a consumer enters into the contract, including the cancellation procedure. The clear and conspicuous disclosure of the automatic renewal clause displayed during the contract formation process must require the consumer to affirmatively consent to the renewal terms.

(b) Any person, firm, partnership, association, or corporation that sells or offers to sell any products or services to a consumer pursuant to a contract, where such contract term is a specified term of 12 months or more, and where such contract automatically renews for a specified term of more than one month unless the consumer cancels the contract, shall notify the consumer in writing of the automatic renewal. Written notice shall be provided to the consumer no less than 30 days and no more than 60 days before the cancellation deadline pursuant to the automatic renewal clause. Such written notice shall disclose clearly and conspicuously, in a retainable form:

(i) that unless the consumer cancels the contract it will automatically renew; and

(ii) where the consumer can obtain details of the automatic renewal provision and cancellation procedure (for example, by contacting the business at a specified telephone number or address or by referring to the contract); .

(iii) the dollar amount that will be charged to the consumer if the consumer does not cancel the contract;

(iv) the length of time for which the contract permits the consumer to be charged for the products and services provided under the agreement; and

(v) a link that directs the consumer to the cancellation process.

(b-5) A person, firm, partnership, association, or corporation that makes an automatic renewal offer or continuous service offer online shall provide a toll-free telephone number, electronic mail address, a postal address if the seller directly bills the consumer, or another cost-effective, timely, and easy-to-use mechanism for cancellation that shall be described in the notice required in subsection (b). A consumer who accepts an automatic renewal or continuous service offer online must be allowed to terminate the automatic renewal or continuous service exclusively online, which may include a termination email formatted and provided by the business that a consumer can send to the business without additional information.

(b-10) Any person, firm, partnership, association, or corporation that sells or offers to sell any products or services to a consumer pursuant to a contract, where such contract allows the consumer to accept a free gift or trial as part of an automatic renewal offer before the consumer makes any payment, or where such contract entitles the consumer to an introductory reduced, promotional, or discounted rate before the customer begins paying the full rate, shall be subject to the requirements described in subsection (b) and shall provide notice at least 3 days before, and at most 21 days before, the expiration of the predetermined period of time for which the free gift or trial, or reduced, promotional, or discounted rate applies.

An offer shall be exempt from the requirements under this subsection if the consumer does not enter into the contract electronically and the business has not collected or maintained the consumer's valid email address, phone number, or another means of notifying the consumer electronically.

(b-15) A person, firm, partnership, association, or corporation that allows consumers to accept an automatic renewal or continuous service offer online shall allow a consumer to terminate the automatic renewal or continuous service exclusively online, at will, and without engaging any further steps that obstruct or delay the consumer's ability to terminate the automatic renewal or continuous service immediately. The business shall provide a method of termination that is clearly and conspicuously available online in the form of either, or both, of the following:

(i) a prominently located direct link or button which may be located within either a customer account or profile, or within either device or user settings; or

(ii) by an immediately accessible termination email formatted and provided by the business that a consumer can send to the business without additional information.

The link or button and the email described in this subsection shall also feature a clear and conspicuous phone number which consumers may call in order to terminate their automatic renewal contract. Termination via phone call shall be sufficient in lieu of the online termination process.

(c) A person, firm, partnership, association, or corporation will not be liable for a violation of this Act or the Consumer Fraud and Deceptive Business Practices Act if such person, firm, partnership, association, or corporation demonstrates that, as part of its routine business practice:

(i) it has established and implemented written procedures to comply with this Act and enforces compliance with the procedures;

(ii) any failure to comply with this Act is the result of error; and

(iii) where an error has caused a failure to comply with this Act, it provides a full refund or credit for all amounts billed to or paid by the consumer from the date of the renewal until the date of the termination of the account, or the date of the subsequent notice of renewal, whichever occurs first.

(Source: P.A. 102-517, eff. 1-1-22.)