Salon memberships must be easier to cancel from 1 July 2027

Abby's take

What this means for the industry — and for independents

Industry impact. Recurring service plans can smooth demand and cash flow, but they also create continuing payment obligations. The new Australian Consumer Law provisions target the information, renewal and cancellation friction that can make a membership profitable only because clients struggle to leave.

For freelancers. A small hair business may rely on booking or payment software for the entire customer journey, yet the supplier remains responsible for the membership it offers. A provider that cannot show the required information or support a compliant exit can turn a simple offer into a legal and reputation risk.

What I'd do next

• Identify every offer with recurring payment, automatic renewal, a free-to-paid conversion or an introductory rate that rises automatically.
• Map exactly what a client sees before accepting: price liabilities, duration, renewal or continuation, notice and the way to end the contract.
• Test cancellation from the client’s device and require an online exit where the membership can be entered online.
• Ask the booking and payment provider for a dated compliance roadmap, export the contract and payment data, and plan a manual fallback.

Watch-out. The Act commences on 1 July 2027. Some in-contract information and timing requirements depend on regulations that may add detail, so businesses should monitor official guidance. Application can depend on the contract and customer. This is general information, not legal advice.

The law is enacted, but it has not started yet

The Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 received assent on 6 July 2026 and the whole Act is scheduled to commence on 1 July 2027. The subscription provisions sit in new Division 4A of the Australian Consumer Law.

The preparation window matters because the customer journey may sit across a website, booking system, payment provider and manual salon process. Waiting until June 2027 may leave the business dependent on a vendor release it cannot control.

A salon membership can meet the subscription definition in several ways

The Act covers contracts with recurring or continuing supply for an indefinite period and automatic payment, fixed periods that continue unless stopped, initial free periods that convert to paid supply, and introductory periods that automatically move to a higher rate, subject to exclusions.

That can capture more than a streaming-style monthly membership. A maintenance plan, recurring treatment allowance or automatically renewed service program may qualify if its terms have the required effect. Assess the actual contract rather than its marketing label.

Separate a prepaid package from a recurring membership

The sign-up must state what the client is entering

When offering a subscription contract, the supplier must disclose that it would be a subscription and provide information about payment liabilities, the contract period, renewal or continuation, any notice needed to end it and how it can be ended. The disclosure must meet the Act’s prominence and clarity requirements.

A link to dense terms at the bottom of checkout should not be treated as the whole solution. Build the key facts into the decision point, then keep the full terms available. Check mobile sign-up as well as desktop because hidden or truncated information can create a different customer journey.

Cancellation must be easy to find and straightforward

Section 48F requires a way to end the contract and says every exit method the supplier provides must be easy to find, straightforward and limited to steps reasonably necessary to end the contract and protect the subscriber’s interests.

If the subscriber enters online, or the supplier offers online entry for the same kind of subscription, one exit method must be online. A membership that can be bought in a few taps but requires an unanswered phone call or an in-person visit to cancel needs redesign.

Test whether the booking platform can support the required exit

Do not invent reminder dates that regulations have not set

Section 48E creates a framework for prescribed information to be given at prescribed times while a subscription is in effect. The primary Act does not establish one universal reminder interval for every membership; further regulations can prescribe the contract classes, information, timing and manner.

Build the system so reminder rules can be configured without rewriting the offer. Store the client’s start date, renewal date, price, contract version and notification history, and monitor Treasury, ACCC and Federal Register updates rather than copying an overseas reminder schedule.

Old memberships can enter the regime when they change

The application provisions say sections 48B, 48E and 48F apply to contracts entered on or after commencement. A contract entered earlier can become subject when it is renewed, extended, otherwise continued or varied on or after 1 July 2027, from the relevant effective date.

Create a register of existing memberships now. Record whether each renews automatically, when a continuation occurs and which changes might amount to a variation. Do not assume a long-standing member can remain indefinitely on an old cancellation process.

Audit the provider without outsourcing responsibility

Ask the platform to demonstrate the offer screen, consent record, renewal logic, notices, cancellation steps, confirmation and payment stop. Confirm whether the business can export evidence and manually end a contract if automation fails.

Then test the complete path with a non-client account. Count clicks, check the language, use a phone, follow every link and confirm the final payment status. A vendor promise is useful; evidence of the client journey is stronger.

Review the payment journey alongside the membership terms · Keep deposits separate from recurring payment authority

Authoritative sources checked on 9 October 2026

Commencement, subscription definitions, offer disclosures, exit requirements and application to renewed or varied contracts were checked against the enacted Competition and Consumer Amendment (Unfair Trading Practices) Act 2026: https://www.legislation.gov.au/C2026A00064/asmade

The 1 July 2027 start and policy purpose were checked against the Treasury Ministers announcement following passage: https://ministers.treasury.gov.au/ministers/andrew-leigh-2025/media-releases/unfair-trading-tricks-and-traps-be-banned

The structure of the subscription provisions and reliance on regulations for in-contract information were cross-checked against the Parliamentary Library Bills Digest: https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd2526/26bd058

Common questions