The Competition and Markets Authority (CMA) has launched an investigation into Adobe following concerns that early cancellation fees on membership plans for certain products may breach consumer protection law.

The regulator said Adobe customers who cancel more than 14 days into an ‘annual billed monthly’ plan must pay 50% of the remaining yearly fee, though noted that after cancelling, they can still use the product until the end of that month’s billing cycle.

The CMA’s investigation will examine whether these terms are unfair, specifically whether Adobe’s presentation of information about the early termination fee is an unfair commercial practice involving a misleading omission.

At this stage, the CMA has reached no conclusions about whether Adobe has broken the law, and will begin by gathering and analysing further evidence. How the investigation unfolds will depend on the nature of the evidence obtained, but may result in a finding of unlawful conduct, the imposition of remedies, or closure of the case.

“From students to content creators, millions of people rely on digital design tools – and they should feel confident that businesses selling these services play by the rules,” said Emma Cochrane, executive director for consumer protection at the CMA.

“Our investigation will consider whether Adobe customers are getting a fair deal and if they have enough information upfront about the cancellation fee.”

This week saw Adobe agree to a $150 million settlement in the US to resolve allegations that the company’s subscription practices violated federal law, with $75 million to be paid in civil penalties and an equal amount being offered to customers in free services.

In a complaint filed in California, the US government alleged that Adobe violated the law by using fine print and inconspicuous hyperlinks to hide important information about its subscription plans, including information about hefty early termination fees.

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In that case, the government alleged that Adobe had “thwarted subscribers’ attempts to cancel, subjecting them to convoluted and inefficient cancellation processes filled with unnecessary steps, delays, unsolicited offers, and warnings.”

Commenting on the US settlement, Adobe said: “We have always prioritised giving our customers the flexibility to choose the plan that best fits their needs, timeline and budgets. This includes offering multiple types of plans where customers can choose between lower upfront costs and maximum flexibility.

“While we disagree with the government’s claims and deny any wrongdoing, we are pleased to resolve this matter.” 

With the US case concluded, Adobe will now have to turn its attention to the UK, where two years ago, the CMA denied the firm the opportunity to acquire product design software firm Figma, with the regulator citing concerns that the $20 billion deal would harm competition and innovation in the sector.