We seem to have conflicting information on exactly how the ARB is designed to work when dealing with annual billings.  Our company sells a product that includes an annual reoccurring billing for several years after the original sale.  The first year subscription is included within the initial product purchase.  Subsequent years are billed on the anniversary date of the original purchase.

If the customer makes the original product purchase using a credit card that will expire sometime during the first year (before the ARB will have been initiated) will Authorize.net still be able to automatically set up a ARB?  It is no problem, and setting up a ARB works fine if the customer makes the original purchase using a credit card that expires greater than one year out.  If the card expires before the first annual billing we cannot get it to set up the ARB.  We don't know if this is a coding issue or just the way Auth.net works.

We have had two different explanations of how this is to operate.  1) It is impossible to set up the ARB because Auth.net flags this as a card that has (will) expire and therefore unable to setup and/or process the future charge, or 2) Setting up the ARB is still possible and we will receive the usual notification 30 days prior to the cards expiration date.

Does anyone have experience with this and a definitive answer as to which is correct?