Rules and ethics
Does the DMCC Act change UK SaaS renewal emails?
SaaS marketing faces new DMCC Act rules on auto-renewal reminders, cooling-off periods and price transparency. Here is what to change in your emails and checkout.
What to take away
- Yes. Consumer SaaS sold in the UK needs a standalone renewal reminder before each charge, with a direct cancellation route.
- Cancellation must be no harder than sign-up, and a cooling-off window follows sign-up.
- Mid-term price rises need advance notice, and the customer can cancel without penalty.
- Commencement is expected no earlier than 2026, and three timings depend on secondary legislation.
- The CMA can fine up to 10 per cent of global turnover or £300,000, whichever is higher.
When the subscription rules actually start
The Digital Markets, Competition and Consumers Act 2024 received Royal Assent in May 2024. Its subscription regime is not in force yet. Government statements put commencement no earlier than 2026, with a transition period for existing contracts.
DMCC Act subscription rules timeline
- May 2024Royal Assent received
- No earlier than 2026Subscription rules come into force
- After commencementTransition period for existing contracts
Three timings remain pending secondary legislation: the reminder send window, the cooling-off length and the price-increase notice period. The working expectation is at least 14 days and at least 30 days, but neither is confirmed.
Set the day counts when the regulations are laid.
Which UK SaaS contracts the DMCC Act covers
A subscription contract is one where a consumer pays on a recurring basis and the plan renews unless they cancel. Monthly and annual plans sold direct to individuals fall inside it.
Free trials that convert to paid and freemium accounts that roll into a paid tier without fresh consent are both caught.
Consumer services also sit under the Consumer Rights Act 2015, so this adds to duties you already have. Use the SAAS marketing commercial contracts checklist to align terms before you redraft emails.
B2B contracts sit outside the subscription rules, though sole trader and partnership deals can be ambiguous. Split the journeys and take legal advice.
What every renewal reminder email must contain
The reminder must be its own message about the renewal, not a line inside a newsletter. Send it to the contact details on the account and log what went out and when.
| Element | Requirement | Status |
|---|---|---|
| Send point | Before each renewal charge, so monthly plans need monthly reminders | Pending secondary legislation |
| Content | Amount, charge date and billing frequency | In the Act |
| Cancellation | A direct link or button to cancel | In the Act |
| Format | A standalone renewal notice, not a marketing email | In the Act |
Compliant vs non-compliant renewal reminders
Compliant reminder
- Format
- Standalone email
- Content
- Amount, date, frequency
- Cancellation
- Direct link included
- Timing
- Before each charge
- Tone
- Neutral and clear
Non-compliant reminder
- Format
- Buried in newsletter
- Content
- Vague or missing details
- Cancellation
- Phone or email only
- Timing
- After or at charge
- Tone
- Guilt or pressure
Example: a compliant renewal email
Subject line: Your subscription renews on 14 March
Body: Hi [first name]. Your monthly plan renews on 14 March and we will charge £20 (illustrative figure). Your plan continues unless you cancel. Cancel online in two clicks, or use this link: [cancel link]. There is no cancellation fee.
Our SAAS marketing UK regulations guide shows how reminder wording fits your wider compliance map.
Cancellation and cooling-off in the checkout flow
The cancellation route belongs in the account area, not behind a support ticket. Cancellation must be no harder than sign-up, on every channel you sell through.
- Show total price, billing frequency and next renewal date before payment details are entered.
- State that the plan renews automatically unless cancelled.
- Explain the cooling-off right and how to use it.
- Take active consent. Pre-ticked boxes do not count.
- Send a confirmation email repeating the key terms and the cancellation route.
The cooling-off window is pending secondary legislation, with at least 14 days as the working expectation. During it, charge nothing or refund what was taken, and apply no penalty.
Mid-term price increases and notice periods
Any mid-term rise in what the customer pays needs notice before it starts, including the end of a promotional rate. The notice period is still to be set, with at least 30 days as the working expectation.
A price rise with no notice is the easiest breach to evidence, because the charge appears on the customer's statement.
The notice must carry:
- The new price and the date it starts.
- The reason for the increase.
- How to cancel before it takes effect.
- Confirmation that cancelling carries no penalty.
Our SAAS marketing pricing models guide ties plan changes to cost per lead.
CMA fines and enforcement powers
The Competition and Markets Authority enforces these provisions and can impose a penalty without going to court. The maximum is 10 per cent of global turnover or £300,000, whichever is higher.
The CMA expects key terms to be prominent and cancellation to match sign-up. Its consumer enforcement guidance explains how it uses these powers.
Common questions
When do the DMCC subscription rules start?
Commencement is expected no earlier than 2026, with a transition period for existing contracts.
Do the rules apply to B2B SaaS contracts?
No. Business contracts sit outside the subscription regime. Sole trader and partnership deals need a closer look, and unfair commercial practices rules can still apply.
How long is the cooling-off period?
Not yet fixed. The working expectation is at least 14 days, mirroring distance selling rules, but treat it as unconfirmed.
Can the CMA fine a SaaS company directly?
Yes. It can impose penalties without a court order, up to 10 per cent of global turnover or £300,000, whichever is higher.
