Selling digital products in California? Here’s what you need to know about AB 2426
If you sell digital products like software or streaming content to customers in California, it’s important to be aware of a new consumer protection law that came into effect on January 1, 2025. AB 2426 is a state law designed to ensure that consumers understand the limitations and terms associated with purchasing licensed digital goods.
Key Points of AB 2426:
1. License Disclosure: When selling licensed digital goods, sellers must provide a clear disclosure about the nature and restrictions of the license. This information must be presented to consumers before the purchase is made, and simply including it in your Terms and Conditions is not sufficient.
2. Applicability: If your business sells or advertises licenses to digital goods in California and uses terms like “purchase” or “buy,” AB 2426 likely applies to you. Consulting with a qualified attorney can help determine the specific requirements for your unique situation.
3. Compliance and Transparency: AB 2426 emphasizes transparency in digital product transactions to build consumer trust and future-proof against similar regulations in other jurisdictions.
What Does This Mean for Your Business?
– Understand the distinction between selling a license and selling a product outright.
– Ensure that your product descriptions and checkout process clearly communicate the licensing terms to customers.
– Review your existing language and terms to avoid misleading consumers about ownership rights.
– Stay informed about evolving ecommerce laws and regulations that may impact your business.
How WooCommerce Can Help:
– Use product descriptions and attributes to highlight licensing information.
– Implement block-based checkout notices for additional disclosures.
– Seek legal counsel to ensure compliance with AB 2426 and other relevant regulations.
Remember, every business is unique, and it’s essential to consult with a qualified attorney to address your specific needs and comply with regional regulations. By adhering to AB 2426 and providing transparent information about digital product licenses, you can build trust with consumers and protect your business from legal disputes.
If you have further questions or need assistance with compliance, consider reaching out to a legal professional or engaging with the WooCommerce community. Happy selling!