The bill amends the Michigan Consumer Protection Act by adding a new section (Sec. 3j) that establishes specific requirements for consumer contracts with automatic renewal provisions. It mandates that businesses must clearly disclose the automatic renewal terms in a conspicuous manner, using at least 14-point type. The disclosure must include details such as the initial contract term, renewal periods, pricing information, cancellation procedures, and any changes in terms upon renewal. Additionally, businesses are required to provide electronic notice to consumers 30 to 60 days before the contract renewal, informing them of the renewal terms and their right to cancel.

Furthermore, the bill prohibits businesses from automatically renewing contracts for more than two months without prior electronic notice and requires them to allow consumers a minimum of 30 days to cancel after receiving such notice. It also stipulates that businesses must not charge additional fees for cancellation and must provide an easy-to-use mechanism for consumers to cancel their contracts. Contracts that do not comply with these provisions are deemed voidable by the consumer. The new regulations do not apply to certain regulated services, such as those offered by the Michigan public service commission.

Statutes affected:
Senate Introduced Bill: 445.901, 445.922