Changes to California Law - Are you Compliant?

Changes to California Law - Are you Compliant?

As many of you maybe aware, the California senate passed many new acts relating to rebills, continuous services and subscription-based businesses and the way in which they’re processed. While some of the legislations have little impact, others such as SB 313 and AB 314 are not to be taken lightly.

In fact, if your business makes sales from customers located in the state of California, you need to ensure that you’re following the regulations sufficiently to avoid possible prosecution for not being compliant, hence this friendly reminder.

Bill SB 313, makes it unlawful for any business to automatically rebill a customer’s credit card who resides within the state of CA without first providing the customer with full terms of continuous service. Furthermore, to be compliant of bill SB-313, all businesses must provide full company contact information which is to include a toll-free telephone number, support email, postal address and concise ability for the customer to cancel renewal before it is processed.

A brief summation of what can be done to maintain compliance with SB 313 is as simple as following BRAM guidelines that are already in place but an overview of ways to ensure compliance is by;

  • Stating that the membership automatically renews until cancelled by the cardholder before the sale is submitted for authorization
  • Ensure that your terms and conditions include verbiage stating that the memberships are recurring until cancelled
  • Include a cancelation policy in your terms and conditions

 Additionally, bill AB-314 is in direct relation to online dating services and the way in which consumers are billed.

This bill requires the business to be completely transparent and enable the customer to cancel any service or offer within 72 hours of initial purchase. If the customer wishes to continue service, they must be notified in writing (electronically accepted) and are required to agree to the new services and the charges incurred with the renewal.

All moneys paid pursuant to any contract for dating services shall be refunded within 10 days of receipt of the notice of cancellation by the customer. Every dating service contract shall contain on its face, and in close proximity to the space reserved for the signature of the buyer, a conspicuous statement in a size equal to at least 10-point boldface type, as follows:

“You, the buyer, may cancel this agreement, without any penalty or obligation, at any time prior to midnight of the original contract seller’s third business day following the date of this contract, excluding Sundays and holidays. To cancel this agreement, mail or deliver a signed and dated notice, or send a telegram which states that you, the buyer, are canceling this agreement, or words of similar effect. This notice shall be sent to:

_____ (Name of the business that sold you the contract) _____

_____ (Address of the business that sold you the contract) _____ .”

This “California Rebill Recap” article is provided by MobiusPay, who wishes to remind all online businesses that new legislations come into effect frequently, yet are often neglected, which could have a devasting impact on your business if discovered.

MobiusPay’s CEO, Mia Hyun, can’t stress enough as to how important it is to be compliant and remain informed of everchanging online processing regulations such as the one’s mentioned in this article because failure to comply could result in merchant account termination and prosecution that can cost your business thousands in legal costs.

It’s advised to regularly communicate with your payment processor to ensure that your business is operating within legal compliance but if you find you’re being neglected and are uncertain as to what legislations apply to you and your business, MobiusPay is always available to assist where your current merchant maybe failing.

For more information regarding MobiusPay services visit or email their support team at

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