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Contract trap · Subscription

Hidden annual/junk fees

Beyond the headline monthly price the contract adds a yearly 'annual fee' or 'club enhancement fee', activation/initiation/reactivation fees, 'regulatory recovery' or convenience surcharges billed on a separate date, prices shown without tax, and a full-retail 'non-return fee' for routers or set-top boxes not sent back within 14-30 days of cancellation.

Severity
Expensive
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

  • annual fee
  • annual membership fee
  • club enhancement fee
  • activation fee
  • reactivation fee
  • initiation fee
  • regulatory recovery fee
  • convenience fee
  • billed on or around
  • prices exclude applicable taxes and fees
  • equipment must be returned within 14 days
  • unreturned equipment charge

In Russian-language contracts

  • вступительный взнос
  • плата за оформление клубной карты
  • сервисный сбор
  • плата за активацию
  • плата за восстановление доступа
  • ежегодный членский взнос
  • комиссия за обработку платежа
  • стоимость указана без учета комиссии
  • стоимость без учета НДС
  • оборудование предоставляется во временное пользование
  • штраф за невозврат оборудования
  • стоимость невозвращенного оборудования удерживается

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Why it bites

Advertised '$10/month' becomes materially more; the annual fee hits on an unexpected date and is non-refundable even if you cancel the next week; equipment fees exceed the used device's value and are charged for returns 'not received'.

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

Permitted if disclosed; undisclosed or misleadingly described fees are deceptive/unfair (FTC v. Vonage 2022; FTC junk-fee rule 2025 covers live events/lodging only, but Sec. 5 applies broadly); CA ARL requires all recurring charges disclosed before consent; the TV Viewer Protection Act (2020) bars charging for equipment the customer does not use.

  • Cited
  • FTC v. Vonage
  • Viewer Protection Act

European Union

CRD Art 6(1)(e) total price including all charges; Art 22 express consent for extra payments; UCPD drip pricing is misleading; EECC Art 105(6) requires free equipment-return procedures with compensation limited to pro rata temporis value.

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

United Kingdom

CCRs 2013 total-price rules; DMCC Act 2024 bans drip pricing (mandatory fees in the headline price) from April 2025; Ofcom GC C1 and CRA Sch 2 para 6 — equipment fees must reflect genuine loss.

  • Cited
  • DMCC Act 2024
  • GC C1
  • Ofcom

Russia

Must be included in the disclosed price (ст. 10 ЗоЗПП); additional paid services need separate consent (ст. 16 п. 3.1) and cannot condition the main service (ст. 16 п. 2 пп. 5); return of equipment is lawful (ст. 689 ГК) but a fixed штраф for a consumer is suspect under ст. 16 п. 2 пп. 3 — only actual value/damage recoverable.

  • Cited
  • ст. 10 ЗоЗПП
  • ст. 16 п. 2 пп. 3
  • ст. 16 п. 2 пп. 5
  • ст. 16 п. 3
  • ст. 689 ГК

Where this has actually happened

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

  • FTC v. Vonage (junk fees plus cancellation obstruction; $100M, 2022)
  • Planet Fitness (annual fee billed separately from monthly dues; recurring subject of US class actions)

What to do

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

  1. Ask for the all-in first-year cost in writing
  2. Find the annual-fee date and its refund rule and cancel before it
  3. At cancellation ask for the return procedure and a prepaid label, photograph the device and serial, ship tracked
  4. US: cite FTC junk-fee guidance and state ARL total-price rules
  5. UK: DMCC drip-pricing ban
  6. RU: undisclosed fees are навязанная услуга (ст. 16 п. 3.1 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