New York’s FAIR Business Practices Act took effect on February 17, 2026, and it changes the legal standard for how businesses treat customers in the state. Signed by Governor Kathy Hochul on December 19, 2025, this is the first update to New York’s core consumer protection statute in 45 years.
The law expands prohibited conduct to include “unfair” and “abusive” acts or practices, alongside the existing ban on deceptive conduct. Previously, New York only outlawed deception. Now, any practice that causes substantial harm a customer can’t reasonably avoid, and that isn’t outweighed by benefits, can be treated as a violation.
What “unfair” and “abusive” mean in practice
An act or practice is “unfair” when it causes or is likely to cause “substantial injury” that is not reasonably avoidable and is not outweighed by countervailing benefits to consumers or to competition. Think surprise fees, hard-to-cancel subscriptions, or contract terms that quietly work against the customer.
“Abusive” covers acts that materially interfere with a person’s ability to understand a term or condition of a product or service, or that take unreasonable advantage of a person’s lack of understanding of material risks, costs, or conditions. Confusing billing language or checkout designs that obscure real costs could land here.
Who needs to pay attention
This isn’t limited to New York-based companies. For entities conducting business in New York, regardless of whether the entity is located in the state, the new law raises the bar for compliance. If you sell to New York customers online, through subscriptions, or via service contracts, you’re in scope.
The law also extends protections to businesses and nonprofits, not just individual consumers. That means B2B dealings with New York-based small businesses or nonprofits also fall under this standard.
Enforcement and private lawsuits
The New York Attorney General has exclusive enforcement authority over unfair and abusive acts. Private plaintiffs continue to have a right of action only for deceptive acts and practices. So your customers can’t personally sue you under the new “unfair” or “abusive” categories, but the AG’s office can investigate and take action, seeking injunctions, penalties, and restitution.
One useful detail for compliance-minded owners: the Act preserves a compliance defense for conduct that is subject to and complies with federal agency rules and regulations. If you’re already following applicable federal rules (FTC, for example), document it. That record could help if questions arise.
What to do now
If you serve New York customers, review your billing practices, contract terms, cancellation and refund processes, auto-renewals, and fee disclosures. Look for anything that could cause real harm a customer can’t easily avoid. Simplify confusing language. Make it easy to cancel. The cost of a legal review now is far less than an AG enforcement action later.
For more detail, see Arnold & Porter’s analysis of the FAIR Act and the Consumer Financial Services Law Monitor breakdown. With the AG’s office publicly signaling this law as a priority, early enforcement actions could set the tone for how broadly these new standards are applied.
