The UK's New Subscription Contracts Regime: A Compliance Guide for Software Teams

What is the UK’s subscription contracts regime, and when does it start?

The subscription contracts regime is a set of consumer protection rules within the Digital Markets, Competition and Consumers Act 2024 (DMCCA). It targets the specific problems regulators identified with subscription businesses: unclear sign-up terms, renewals that catch people by surprise, and cancellation flows deliberately made harder than sign-up.

The DMCCA received Royal Assent in May 2024, and its general unfair commercial practices provisions have applied since April 2025. The subscription contracts regime is a separate, later-commencing part of the same Act, and it is not yet in force.

Its start date has moved twice. It was originally expected during 2026, then pushed back to spring 2027. In August 2026, the government confirmed it now intends to commence the regime in January 2027, bringing the date forward again (Stephenson Harwood, August 2026). Secondary legislation and detailed statutory guidance are still to follow, so treat January 2027 as the current government position rather than a locked date, and revisit it as guidance is published.

Who has to comply?

The regime applies to any trader offering a continuous or automatically renewing supply of goods, services, or digital content to UK consumers, regardless of where the trader itself is based (White & Case, 2026). It only covers consumer contracts: an individual acting wholly or mainly outside their trade, business, craft, or profession. Business-to-business subscriptions sit outside its scope, though the government has said further guidance will clarify how the rules apply to mixed contracts, such as a bundled telecoms and streaming package (Osborne Clarke, 2026).

A number of sectors are excluded, including utilities, financial services, accommodation, travel, education, and certain charitable memberships. If your product sits in one of these sectors, or close to the boundary of one, get a specific legal opinion rather than relying on a general summary like this one.

What must you tell customers before they subscribe?

The DMCCA requires clear pre-contract information, provided on a durable medium, before a consumer commits to a subscription. The purpose of this information must be immediately apparent, not buried in a wall of terms and conditions.

In practice, this means your sign-up flow needs to surface, clearly and before payment:

• The total price and how it is billed (monthly, annually, or another cadence)
• That the contract will auto-renew, and on what terms
• How to cancel, before the consumer has committed to anything
• Any free trial or introductory price, and what happens when it ends

None of this is exotic if your checkout already follows good UX practice. The risk is in legacy checkout flows that were built before subscriptions became the default commercial model, where auto-renewal and cancellation terms are still tucked away in a terms-of-service link nobody reads.

What renewal and reminder notices will you need to send?

Before a subscription lasting one year or more auto-renews, and after a free trial converts to a paid subscription, the DMCCA requires a written reminder notice sent on a durable medium. The government has confirmed that email, SMS, and WhatsApp all qualify as a durable medium, because the consumer can retain and revisit the message. A fleeting in-app notification that disappears when dismissed does not meet the bar (Osborne Clarke, 2026).

The notice’s purpose must be immediately apparent to the consumer. A reminder that reads like routine marketing content, or that is buried inside a longer newsletter, is unlikely to satisfy this requirement.

What this means for your data model

If your billing system does not already treat “reminder sent” as a first-class, auditable event, this is the moment to add it. You need to record, for every subscription:

• The date the reminder was sent
• The channel it was sent through (email, SMS, WhatsApp, or another durable medium)
• A retrievable copy of the content sent, not just a log line saying a reminder fired
• Confirmation that delivery did not fail (a bounced email does not count as a sent reminder)

This is an audit trail requirement as much as a notifications requirement. If a regulator or a consumer disputes whether a reminder was sent, the burden falls on the business to show that it was, in the correct form, at the correct time.

How do the new cooling-off periods work?

Two separate cooling-off rights will apply. The first already exists: the Consumer Contracts Regulations 2013 give a consumer a 14-day right to cancel most distance contracts, including the initial sign-up to a subscription, for a full refund.

The DMCCA adds a second cooling-off window. Consumers get a new 14-day cooling-off period after a free trial converts to a paid subscription, and after a subscription lasting one year or more auto-renews (White & Case, 2026). If a business fails to send a compliant reminder notice, or sends a defective one, this cooling-off period does not start on schedule. It can extend until 14 days after a compliant notice is finally sent, up to a maximum of 12 months.

During the renewal cooling-off period, a consumer who cancels is entitled to a proportionate refund based on how much of the renewed term they have actually used, calculated against the total contract price for that renewal.

What does click to cancel require from your cancellation flow?

This is the requirement most likely to mean genuine engineering work rather than a policy update. The regime requires that consumers can exit a subscription in a straightforward way, without unnecessary hurdles.

The core rule is simple to state and harder to retrofit: if a consumer can sign up online, they must be able to exit online, through a comparably easy path. A business that only offers cancellation by phone or by emailing a named account manager, while sign-up is a two-minute web form, will not meet this standard.

Two practical points from the guidance so far:

• Merely publishing an email address is unlikely to count as an online exit. The government’s steer is that the cancellation path itself needs to be a functioning online journey, not a request that a human then has to action.
• Retention offers and feedback prompts cannot block or unreasonably delay cancellation. You can still ask a leaving customer if they would consider a discount or want to explain why they are leaving, but that ask cannot be a mandatory gate the consumer must pass through before the cancellation is processed.

What refund rules apply?

Refund entitlements vary by what is being supplied. For digital content and services, a consumer who cancels during a cooling-off period is entitled to a proportionate refund based on the total subscription price for that renewal term. For subscriptions that include returnable physical goods, a full refund, including delivery costs, generally applies unless the goods are unsealed, spoiled, or perishable (White & Case, 2026).

Refunds must be processed within 14 days and returned to the original payment method. If your billing platform currently issues refunds as store credit by default, or routes them through a manual approval queue with no defined turnaround time, that process needs to change ahead of commencement.

What happens if you get it wrong?

The Competition and Markets Authority (CMA) can enforce the DMCCA’s consumer protection provisions directly, without first going to court. For a breach of the subscription contracts regime, that includes fines of up to 10% of a business’s group worldwide annual turnover, alongside redress orders requiring refunds to affected consumers (White & Case, 2026). For a subscription business operating at scale, the exposure from a systemic checkout or cancellation flaw is not a rounding error.

What should software teams build now, ahead of January 2027?

The government’s implementation guidance is still incomplete, but the direction of travel is clear enough to start engineering work now rather than waiting for every detail to be confirmed. A pre-commencement checklist:

1. Audit your current checkout flow against the pre-contract information list above: price, billing cadence, auto-renewal terms, and cancellation method, all disclosed before payment.
2. Add a first-class “reminder notice” event to your subscription data model, recording the date sent, the channel used, a retrievable copy of the content, and delivery confirmation.
3. Build a reminder scheduling engine that fires ahead of every annual-or-longer renewal and every trial-to-paid conversion, on a durable medium such as email or SMS rather than only an in-app toast.
4. Rebuild self-serve cancellation as a first-class online flow, not a support ticket. Map every existing step between “I want to cancel” and “cancellation confirmed”, and remove any step that sign-up does not also require.
5. Separate retention offers from the cancellation gate. A discount offer or exit survey can appear, but the consumer must be able to decline it and continue cancelling without extra friction.
6. Model the renewal cooling-off period as subscription state, not just a support policy. The system needs to know a subscription is inside its cooling-off window, calculate the pro-rata refund automatically, and route refunds back to the original payment method within 14 days.
7. Extend your audit trail and retention design to cover reminder notices and cancellation requests, consistent with the wider data protection by design principles in our guide to the standard features every compliant system needs.

Much of this overlaps with good subscription billing practice generally. If you are also modernising your recurring billing, our guide on moving from card billing to Direct Debit and our guide on how membership freezes should work cover the adjacent data model decisions in more detail.

Where to go from here

This guide covers the substance of the regime as understood today, ahead of the secondary legislation and statutory guidance the government has said will follow. The government has confirmed January 2027 as its intended commencement date, but this timetable has already moved twice, so treat any specific date as provisional until it is confirmed in secondary legislation.

For the wider legal landscape around bespoke software contracts, see our pillar guide to software development contracts in the UK. If you are planning checkout, billing, or account management changes ahead of the new regime, our custom software development service can help you scope the engineering work, and our managed application support service can keep your compliance posture current as the government’s guidance is published.

If you want to talk through what this means for your specific subscription product, book a consultation.

This guide provides general information about the UK’s forthcoming subscription contracts regime under the Digital Markets, Competition and Consumers Act 2024. It is not legal advice. The regime is not yet in force, and its detailed requirements depend on secondary legislation and statutory guidance that had not been published at the time of writing (August 2026). Consult a solicitor qualified in UK consumer law for advice specific to your business.