Draft regulations set out UK DMCCA subscription contracts regime ahead of January 2027 launch
Published on 9 November 2026
Businesses finally have the information they need, or as much as they are going to receive, to prepare for the new regime
At a glance
The rules cover business-to-consumer contracts, including free trials that convert to paid subscriptions.
Retention offers remain possible but their design raises questions about how easily consumers can leave.
Overlapping telecommunications requirements and app store arrangements leave questions about which duties apply.
The Digital Markets, Competition and Consumers Act 2024 (DMCCA) received Royal Assent back in May 2024, but its subscription contracts regime is still not yet in force. However, the missing operational detail has arrived in the form of the draft statutory instrument, the Consumer Subscription Contracts (Cancellation and Information) Regulations 2026, which was laid before Parliament on 19 October. The Department for Business, Innovation, Science and Trade has also published accompanying draft guidance.
The draft regulations confirm that the DMCCA's subscription regime will come into force on 1 January 2027, reflecting the accelerated timetable announced by the prime minister, Andy Burnham, shortly after taking office.
Scope of the regime
The regime applies to subscription contracts between businesses and UK consumers. This means that any new paid-for subscription contracts, including those starting with an introductory discount or free trial, entered into between a business and UK consumer from 1 January 2027 will be in scope.
Under the DMCCA, a subscription contract is between a trader and a consumer for the supply of goods, services or digital content, or a combination of these, in return for payment, which renews automatically, with the consumer charged unless they take action to stop it. The regime also has extraterritorial reach: it applies to traders based outside the UK that sell to UK consumers and may arguably extend to scenarios where consumers are located outside the UK, depending on the specific facts and circumstances.
The regime does not apply to certain excluded contracts. Examples include contracts for memberships of cultural and heritage charities; utilities, such as electricity, gas or water supply; insurance and financial services; medical prescriptions, excluding the supply of contact lenses or spectacles; gambling; and telecommunications contracts regulated by Ofcom.
Four core obligations
The regime introduces four core obligations for all traders offering consumer subscription contracts.
Consumers must be provided with key pre-contract information and full pre-contract information before entering into a subscription contract. Both sets of information are subject to specific content and presentation requirements that go beyond existing requirements.
The rules require reminder notices at prescribed intervals throughout the subscription. They also require renewal cooling-off notices and end of contract notices when those events occur.
Consumers must be able to exit at any time through a straightforward process that involves no unnecessary steps. Where a consumer signed up online, online cancellation must be available. Customers must also be able to cancel via a clear statement.
Consumers have a 14-day "initial" cooling-off right at the outset of their subscription and a new 14-day "renewal" cooling off period at certain renewal payment dates throughout the life of a contract. Traders must send cooling-off notices to consumers reminding them of their cooling off rights in respect of renewal periods only.
New details in the guidance and regulations
The DMCCA sets out the core requirements. The draft regulations fill important gaps affecting how businesses structure cancellation flows, consumer notices and refunds.
The Department for Business and Trade ran a consultation on the implementation of the subscription contracts regime that closed in February 2025. The guidance and draft regulations broadly follow the government's consultation response in April but provide more detail than anticipated in some areas.
Easy exit and retention offer
Traders can make retention offers during cancellation, but these must not delay or discourage the consumer from completing the process. Requiring a consumer to complete a compulsory survey or feedback form as a condition of exiting is likely to breach the requirements.
The guidance does not specify an acceptable number of steps or screens. This leaves traders to assess where to draw the line. The guidance also confirms that providing an email address does not fulfil the requirement for online cancellation.
Reminder notices
Reminder notices require a durable medium, and must make it immediately clear to the consumer what they are being informed about, for example, by including a clear and descriptive subject line in any email reminder. Generic service emails and non-retrievable push notifications will not be sufficient.
The regulations also "fix" the anomalous treatment of renewal reminders during a concessionary period in the DMCCA, by confirming that the reminder is due when the concessionary period converts to a higher rate rather than being triggered by the first payment.
Cooling-off rights
Where a trader fails to provide the requisite information (or to present that information in the required manner), or renewal cooling-off notices to the consumer, both the initial and renewal cooling-off periods can be extended by up to 12 months.
A digital content waiver is available, but only for digital content subscriptions and only in respect of the initial cooling-off period. Specific conditions must be met, including the consumer's express consent and written confirmation from the trader. The UK cooling-off regime remains, in this regard, potentially more favourable to some traders as compared to the position in the EU, particularly for suppliers of streaming services, following the Sky Austria decision.
Consumers may be entitled to a refund when they cancel within a cooling-off period. The calculation of the refund will depend on the nature of the contract and what has already been supplied up to the point of cancellation. Mixed contracts combining goods, services or digital content require in some instances a potentially complex set of calculations. Contracts for digital content will also entail a refund, when cancelled in a renewal cooling-off period, but the calculation of the amount due will depend on what the trader has committed to supply at the outset.
Cancellation and refund rights
Consumers have the right to cancel their contract within a 12-month period starting after the "relevant date" where the trader breaches certain duties that are implied into the contract, such as failing to provide key pre-contract information, send a reminder notice or provide an "easy exit". They may be entitled to a refund. The draft regulations specify the relevant date for each scenario and list acts or omissions that constitute breaches of the implied terms.
Uncertainties remain
However, there are still a number of unanswered questions, particularly around excluded contracts, third-party platforms and complex subscriptions.
In relation to excluded contracts, the guidance is not clear on the scope of the new regime in respect of complex mixed contracts, particularly those involving bundles involving regulated telecoms services.
Under the General Conditions of Entitlement, Ofcom's rules apply to both telecoms services such as broadband and a broad range of other services bundled with them, including streaming services and TV. This applies whether they are supplied under one contract or two linked contracts.
However, the subscription guidance states that products supplied under separate contracts are considered separately against the DMCCA's definition of a subscription contract. For products provided under the same contract, the guidance states that "the inclusion of an excluded product does not mean that the whole contract is excluded".
The guidance therefore could be read as creating a situation where providers that are bundling Ofcom and non-Ofcom subscription services need to comply with both sets of rules.
The guidance states that broadly speaking duties under the subscription rules are on the trader with whom the consumer enters into the subscription contract. However, there is still some uncertainty around how this will work in practice, for example where an app store is the contracting entity but the app developer controls key parts of the purchase journey.
The guidance is primarily designed with straightforward subscription structures in mind. There is significantly less clarity on how the requirements apply to subscriptions with more complex structures; for example, where consumers can upgrade or purchase add-ons or bolt-ons alongside their core subscription. Traders operating such models will need to consider carefully how to apply the guidance to their specific arrangements.
Parliamentary approval
The draft regulations are subject to the affirmative procedure in Parliament meaning that they will need to be approved by both chambers before being brought into force. The guidance will be published in final form when the regulations are made.
Osborne Clarke comment
Businesses now have more of the detail they have been waiting for, but limited time remains before 1 January 2027. However, although the regulations and guidance are still in draft, material changes are not anticipated.
Despite stakeholder concerns, the government has not introduced a statutory grace period. Emma Cochrane, the executive director for consumer protection at the Competition and Markets Authority (CMA) has offered some reassurance. The regulator's early focus will be on supporting compliance rather than pursuing enforcement action across the board, with a proportionate approach.
However, the CMA has been equally clear that non-compliance from the outset may still be considered as part of enforcement action, particularly if it is "egregious". It expects businesses to bring themselves into compliance "as quickly as possible". With fines of over £12 million already issued since the DMCCA consumer regime took effect, show the regulator's willingness to use its enhanced powers.
For subscription businesses, however, the short timetable means there is limited period to implement changes to sign-up processes, pre-contract information, reminder notice processes and cancellation journeys ahead of the 1 January 2027.
