Uber probed by US consumer watchdog over subscription plan

Uber is facing an investigation by the US Federal Trade Commission (FTC) into its flagship subscription plan, the company has said.

As first reported by Bloomberg, the US consumer watchdog was probing the ride-hailing giant over the enrolment and cancellation procedures of the service.

Uber One, which has more than 25 million subscribers around the world, offers fee-paying members discounts on rides and deliveries.

The FTC did not immediately respond to a request for comment from BBC News.

“We will continue to answer any questions the FTC may have about our cancellation policies,” said an Uber spokesperson.

“The Uber One cancellation process follows both the letter and the spirit of the law: Uber One members can easily cancel their membership in the app – in fact, the majority of those cancellations take 20 seconds or less.”

The FTC contacted Uber with a proposal for settling the investigation and the company has since written back with a counter offer.

Other technology giants, including Adobe and Apple, have faced lawsuits from the FTC over cancellation policies that the regulator deemed overly complicated.

Those claims have been disputed by the companies.

Last month, the FTC finalised a ‘click to cancel’ rule, which aims to make it easier for people to end subscriptions.

The new regulations, which have been challenged by some business groups, would force companies to make subscription sign-ups and cancellations equally straightforward.

A law introduced in the UK in May also takes aim at so-called subscriptions traps.

The Digital Markets, Competition and Consumers Act 2024 requires businesses to provide clear information to consumers before they enter a subscription agreement.

It forces sellers to remind customers that a free or low-cost trial is coming to an end.

It also requires companies to ensure customers can easily end a contract.