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Contract trap · Subscription

Early termination fee

Leaving before the minimum term triggers a flat fee, the balance of remaining payments or 50% of the remaining contract value; the plan advertised 'per month' is legally an 'annual, paid monthly' 12-month contract pre-selected at checkout; a 'cancellation fee' is due even after the term, cancellation is blocked until the account is 'current', and a 30-day notice or 'one more billing cycle' tail is charged and sent to collections.

Severity
Serious
How often it turns up
Common
Holds up?
Depends where you are
Clause phrases
24

What it looks like in a contract

Redline matches these phrases against your document verbatim. Drafters rarely invent new wording — they copy it, which is why the same sentences turn up across unrelated contracts.

In English-language contracts

  • early termination fee
  • annual plan, paid monthly
  • 50% of your remaining contract obligation
  • the balance of the remaining payments will become immediately due
  • cancellation prior to the end of the minimum term
  • cancellation fee
  • account must be current to cancel
  • 30-day notice period
  • you will be billed for one additional month
  • past due balances may be sent to collections
  • liquidated damages
  • commitment period

In Russian-language contracts

  • штраф за досрочное расторжение
  • годовой тариф с ежемесячной оплатой
  • минимальный срок подписки
  • удерживается 10% от стоимости
  • при досрочном расторжении оплаченная сумма не возвращается
  • возврат скидки при расторжении до истечения
  • плата за расторжение договора
  • комиссия за отключение
  • расторжение возможно после оплаты всех начислений
  • абонентская плата начисляется до момента обработки заявления
  • задолженность передается коллекторскому агентству
  • полная стоимость абонемента без учета скидки

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Why it bites

The fee can exceed the value of the service used and surfaces only when you try to leave; the '/mo' emphasis is the deception mechanism the FTC targeted at Adobe; tails and 'past due' dues damage credit scores when people close the card instead.

Is it enforceable where you are

The same clause can be routine in one country and void in another. What follows is what the law says where you are — not advice on your particular contract.

In the US, ROSCA and state automatic-renewal laws such as California's ARL apply; in the EU, Directive 93/13 Annex 1(h) and national reminder rules (Germany §309 Nr. 9 BGB, France's loi Chatel) govern renewal.

United States

Enforceable if clearly disclosed and not a penalty; hidden or buried ETFs and undisclosed annual terms are deceptive (FTC v. Adobe 2024; ROSCA/Sec. 5); CA ARL requires the term and cancellation policy next to the consent request; state gym statutes cap ETFs and cancellation fees or grant fee-free exit on relocation/disability (NY GBL Art. 30); continuing to bill after a valid cancellation violates ROSCA (Vonage).

  • Cited
  • FTC v. Adobe
  • ROSCA

European Union

UCTD Annex 1(e): disproportionately high compensation is indicatively unfair — only a genuine pre-estimate of loss; CRD Art 6(1)(o)/(p): duration and minimum commitment disclosed before the consumer is bound; EECC Art 105 limits telecom compensation to residual equipment value and caps initial terms at 24 months; DE/NL allow no exit fee for indefinite contracts and max 1-month notice.

  • Cited
  • CRD Art 6(1)
  • EECC
  • UCTD

United Kingdom

CRA 2015 Sch 2 paras 5-6 (disproportionate sums); Ofcom General Conditions cap ETFs and limit notice periods to 30 days; CMA37 — exit charges must reflect genuine loss; CCRs 2013 require the minimum term pre-contract; DMCC easy-exit rule.

  • Cited
  • CMA37
  • CRA 2015 Sch 2 paras 5-6
  • Ofcom

Russia

Void: consumer may refuse at any time paying only фактически понесённые расходы (ст. 32 ЗоЗПП, ст. 782 ГК); any штраф, неустойка or удержание for exit is a недопустимое условие (ст. 16 п. 2 пп. 3); courts and Роспотребнадзор strike gym '10%' penalties; provider may retain only expenses incurred up to the refusal, and from 1 Mar 2026 charges after refusal are refundable (ст. 16.1).

  • Cited
  • ст. 16 п. 2 пп. 3
  • ст. 16.1
  • ст. 32 ЗоЗПП
  • ст. 782 ГК

Where this has actually happened

Regulator actions, court rulings and the contracts they were fought over.

  • FTC v. Adobe and executives, June 2024 — 'Annual, Paid Monthly' plan pre-selected, ETF of 50% of remaining payments disclosed only via tooltip; settled 13 March 2026 for $150M
  • Роспотребнадзор и суды: удержание 10% стоимости абонемента фитнес-клуба при досрочном расторжении признано незаконным
  • FTC v. Vonage (2022) — continued charging after cancellation requests, $100M
  • SiriusXM Customer Agreement — 'cancellation fees or early termination fees may be charged in connection with certain offers'

What to do

In order, from the thing that takes a minute to the thing that takes a letter.

  1. Read the plan name and term, not the price, and switch a pre-selected 'annual, paid monthly' plan to true monthly
  2. Screenshot the checkout
  3. Cancel at the start of a billing cycle and get the final charge date in writing
  4. Request a waiver for service problems or relocation
  5. EU/UK: challenge disproportionate fees (UCTD Annex 1(e)/CRA Sch 2 para 6)
  6. RU: refuse to pay — штрафы за отказ ничтожны (ст. 16 п. 2 пп. 3, ст. 32 ЗоЗПП).

Check your own document

Traps that travel with it

Drafters who use one of these usually use several.

79 traps · 1789 verbatim clause phrases