Class Action Filed Against Microsoft Over Automatic Subscription Renewals in Israel

A class action lawsuit seeking over 2.5 million shekels was filed against Microsoft in the Tel Aviv District Court on July 20, alleging the company automatically renews subscriptions despite customers' cancellation requests. The suit claims Microsoft violates Israeli consumer protection laws by making it difficult for users to cancel subscriptions and continuing to charge them beyond the agreed term.

The plaintiff, Zion Bazar, represented by attorneys Ehud Garry and Harel Shlomi, argues that Microsoft only allows refunds within seven days after an automatic renewal. If cancellation is requested after this period, the service continues until the subscription ends, but in some cases, Microsoft allegedly renews the subscription for another year without explicit consent.

Bazar's case involves a March 2025 purchase of an annual Exchange Online subscription for $48. After deciding he no longer needed the service, he requested cancellation two months later but was told no refund was possible since more than seven days had passed. He expected the subscription to end after the year, but in March 2026, he discovered Microsoft had renewed it automatically and charged him for another year.

The lawsuit contends this practice breaches consumer law, which prohibits automatic renewal without explicit consent and requires companies to terminate ongoing contracts within three business days of cancellation notice. Microsoft's cancellation policy is accused of misleading consumers by suggesting they can cancel anytime while imposing conditions that effectively nullify this right.

Microsoft has not yet responded to the court. If the class action is approved, it could include other consumers who faced similar unauthorized charges. Microsoft stated the lawsuit has not yet been received by them.