Georgia Update: Automatic Renewals in Consumer Service Contracts

Georgia HB 1039 amends O.C.G.A. § 13-12-3 to provide additional protections for consumers who enter into service contracts containing lengthy automatic renewal provisions.   

Pre-Existing Requirement: For service contracts with an initial term of twelve months or longer and an automatic renewal provision for more than one month, unless the consumer terminates the agreement, sellers must provide written or electronic notification of the automatic renewal provision to the consumer.  The notification must be provided to the consumer between 30 and 60 days before the cancellation deadline under such renewal provision.  The notice must also “clearly and conspicuously” disclose that unless the consumer cancels, the agreement will automatically renew and disclose how the consumer may obtain details about the automatic renewal provision and cancellation procedure.  The process by which a consumer may obtain such information must include the seller’s contact information (e.g., specific phone number or address), reference to the contract, or any other method provided.  

New Requirement: For service contracts with consumers that automatically renew for more than 24 months, the seller, in addition to the notice requirements above, must also obtain: (i) the consumer’s written or electronic acknowledgement of receipt of the notification and (ii) the consumer’s affirmative written or electronic response that he or she does not intend to terminate the service agreement.   

Governor Kemp signed the bill into law on June 29, 2020.  The Act becomes effective on January 1, 2021.