In the UK, most of the service providers offer a business line which is exactly the same connection, but twice the cost. But you can resell it. Or give it away to your customers. Some of the UK service providers offer a managed Radius server and resale kit too. Extra charges apply.
Technically, by selling a service, be it wifi to local friends or a commercial wifi network that covers a town. You become a service provider. By becoming a service provider you take on real responsibilities. For your own benefit and legal protection. You would legally need to have a "Data Control Officer" if you're in the UK (sorry not sure about the EU or the US).
The Data Protection Act 1998 (UK), requires every person or organisation that processes personal digital information to register with the Information Commissioner’s Office (ICO). Failure to do so is a criminal offence. If individuals wish to do this. It is legal in the UK. Meta data must be stored in accordance with the Act (which account did what when) which will protect the individual or company offering services. Just like any other service provider such as BT or Virgin Media. (see
ICO Guide Lines) for further details.
Now to the gritty part. Reselling your internet connection is NOT a criminal offence. It's simply a breach of contract or TOS with your service provider. The worst they can do is disconnect you and black list you from their services. Which might be an issue if you like Super Fast BB. I say who cares? There are so many service providers out there competing for your cash it would be their loss.
The only problem I see with reselling your home wifi is that most service providers know their way around the internet and can easily see an open AP or radius server on their network. In the following diagram you will see a typical home broadband setup with your broadband router connecting wifi clients and relaying the data to the ISP.
Like pervious posters have stated, this kind of setup will be seen by your ISP and can be legally dangerous for the owner of the account should anyone abuse the connection.
But if you set up your network like this and lock down that firewall good.
Your ISP wont be able to see it, unless they hack your firewall which is a criminal offence. Can't see them going that far. Hope this helps