U.S. Laws on Telemarketing

  The U.S. Congress suggested a nationwide do-not-call database...

In 1991 Congress passed an Act granting consumers certain rights to defend themselves against unwanted telemarketing calls. (Our Anti-Telemarketing Script gives you a easy way to do this, and contains links to the law in case you need to enforce your rights against telemarketers who break it.)

Congress found that ``Many consumers are outraged over the proliferation of intrusive, nuisance calls to their homes from telemarketers.'' In other words, a lot of people were getting a lot of calls that they really didn't want.

The Act outlawed various offensive practices, such as the use of recorded messages for solicitations. It also called for the Federal Communications Commission to ``prescribe regulations to implement methods and procedures for protecting the privacy rights... in an efficient, effective, and economic manner and without the imposition of any additional charge to telephone subscribers.'' In other words, Congress wanted you to be able to stop telemarketers without having to pay.

The next sentence of the Act said that this ``may require the establishment and operation of a single national database to compile a list of telephone numbers of residential subscribers who object to receiving telephone solicitations, and to make that compiled list and parts thereof available for purchase.'' In other words, Congress wanted you to be able to put your number on a list that makes calling your number illegal.

  ...but the FCC preferred another option

The FCC decided against the idea of a single national database, preferring as more ``cost-beneficial'' what they called ``company-specific do-not-call lists.'' In other words, they decided to burden you with the task of telling every company to put your number on their list, giving you no way of telling them all before they call.

A decade later, a different agency, the FTC, finally did what the FCC wouldn't.

  Transnational outbound telemarketing

As international phone calls become almost as cheap as local ones, we are seeing the growth of transnational telemarketing. Many airlines and telcos already send inbound calls across national borders, and some fraudulent telemarketers have already set up scams calling victims from a different country. [FTC Release] [NY Times on telemarketing from India] [Wired on telemarketing from India]

  Caution: legal jargon ahead

The rest of this page consists of FCC documents about what telemarketers are allowed to do. You may not need this much information right now, but it's here if you ever do. A summary of the law is given in our self-help guide, and condensed instructions are in our Anti-Telemarketing Script. See also http://donotcall.gov for information on enforcement based on the National Do-Not-Call Registry.

  Sources

Most of the older laws and regulations concerning telemarketing were issued by the FCC. Some newer ones issued by the Federal Trade Commission are well documented on their web site, so ours contains only a brief summary of them.

The following ``edited highlights'' of FCC regulations were adapted from several sources and are not necessarily up-to-date or accurate; we could find some but not all the relevant texts on the FCC's Web site. Paper copies of U.S. laws and regulations concerning telecommunications can be ordered from the Federal Communications Commission at 1120 19th St N.W., Suite LL-20, Washington, D.C. 20036 (Telephone: +1 202 452 1422).

  A brief legislative history

In 1991 President Bush signed into law the Telephone Consumer Protection Act of 1991 (TCPA), Public Law 102-243 (1991), which amended Title II of the Communications Act of 1934, 47 U.S.C. Section 201 et seq., by adding a new section, 47 U.S.C. Section 227. The U.S. Congress enacted it to reduce the nuisance and invasion of privacy caused by telemarketing and prerecorded calls. Congress ordered the FCC to make and clarify certain regulations some of which are given below (47 CFR 64.1200).

  The FCC's summary of the TCPA

The TCPA imposes restrictions on the use of automatic telephone dialing systems, of artificial or prerecorded voice messages, and of telephone facsimile machines to send unsolicited advertisements. Specifically, the TCPA prohibits autodialed and prerecorded voice message calls to emergency lines, health care facilities or similar establishments, and numbers assigned to radio common carrier services or any service for which the called party is charged for the call, unless the call is made with the prior express consent of the called party or is made for emergency purposes. The TCPA also prohibits artificial or prerecorded voice message calls to residences made without prior express consent, unless it is an emergency call or specifically exempted by the Commission. Unsolicited advertisements may not be transmitted by telephone facsimile machines. Those using telephone facsimile machines or transmitting artificial or prerecorded voice messages are subject to certain identification requirements. Finally, the TCPA requires that the Commission consider several methods to accommodate telephone subscribers who do not wish to receive unsolicited advertisements, including live voice solicitations. The statute also outlines various remedies for violations of the TCPA.

1. No person may
   
   1. Initiate any telephone call (other than a call made for emergency purposes or made with the prior express consent of the called party) using an automatic telephone dialing system or an artificial or prerecorded voice,
      
      1. To any emergency telephone line, including any 911 line and any emergency line of a hospital, medical physician or service office, health care facility, poison control center, or fire protection or law enforcement agency;
      2. To the telephone line of any guest room or patient room of a hospital, health care facility, elderly home, or similar establishment; or
      3. To any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call;
   2. Initiate any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party, unless the call is initiated for emergency purposes or is exempted by sec. 64.1200(c).
   3. Use a telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine.
   4. Use an automatic telephone dialing system in such a way that two or more telephone lines of a multi-line business are engaged simultaneously.
2. For the purpose of sec. 64.1200(a) the term "emergency purposes" means calls made necessary in any situation affecting the health and safety of consumers.
3. The term "telephone call" in sec. 64.1200(a)(2) shall not include a call or message by, or on behalf of, a caller:
   
   1. that is not made for a commercial purpose,
   2. that is made for a commercial purpose but does not include the transmission of any unsolicited advertisement,
   3. to any person with whom the caller has an established business relationship at the time the call is made, or
   4. which is a tax-exempt nonprofit organization.
4. All artificial or prerecorded telephone messages delivered by an automatic telephone dialing system shall:
   
   1. At the beginning of the message, state clearly the identity of the business, individual, or other entity initiating the call, and
   2. During or after the message, state clearly the telephone number (other than that of the autodialer or prerecorded message player which placed the call) or address of such business, other entity, or individual.
5. No person or entity shall initiate any telephone solicitation to a residential telephone subscriber
   
   1. before the hour of 8 A.M. or after 9 P.M. (local time at the called party's location), and
   2. unless such person or entity has instituted procedures for maintaining a list of persons who do not wish to receive telephone solicitations made by or on behalf of that person or entity. The procedures instituted must meet the following minimum standards:
      
      1. Written policy. Persons or entities making telephone solicitations must have a written policy, available upon demand, for maintaining a do-not-call list.
      2. Training of personnel engaged in telephone solicitation. Personnel engaged in any aspect of telephone solicitation must be informed and trained in the existence and use of the do-not-call list.
      3. Recording, disclosure of do-not-call requests. If a person or entity making a telephone solicitation (or on whose behalf a solicitation is made) receives a request from a residential telephone subscriber not to receive calls from that person or entity, the person or entity must record the request and place the subscriber's name and telephone number on the do-not-call list at the time the request is made. If such requests are recorded or maintained by a party other than the person or entity on whose behalf the solicitation is made, the person or entity on whose behalf the solicitation is made will be liable for any failures to honor the do-not-call request. In order to protect the consumer's privacy, persons or entities must obtain a consumer's prior express consent to share or forward the consumer's request not to be called to a party other than the person or entity on whose behalf a solicitation is made or an affiliated entity.
      4. Identification of telephone solicitor. A person or entity making a telephone solicitation must provide the called party with the name of the individual caller, the name of the person or entity on whose behalf the call is being made, and a telephone number or address at which the person or entity may be contacted. If a person or entity makes a solicitation using an artificial or prerecorded voice message transmitted by an autodialer, the person or entity must provide a telephone number other than that of the autodialer or prerecorded message player which placed the call. The telephone number provided may not be a 900 number or any other number for which charges exceed local or long distance transmission charges. [as amended 7/26/95]
      5. Affiliated persons or entities. In the absence of a specific request by the subscriber to the contrary, a residential subscriber's do-not-call request shall apply to the particular business entity making the call (or on whose behalf a call is made), and will not apply to affiliated entities unless the consumer reasonably would expect them to be included given the identification of the caller and the product being advertised.
      6. Maintenance of do-not-call lists. A person or entity making telephone solicitations must maintain a record of a caller's request not to receive future telephone solicitations. A do not call request must be honored for 10 years from the time the request is made. [as amended 7/26/95]
6. As used in this section:
   
   1. The terms "automatic telephone dialing system" and "autodialer" mean equipment which has the capacity to store or produce telephone numbers to be called using a random or sequential number generator and to dial such numbers.
   2. The term "telephone facsimile machine" means equipment which has the capacity to transcribe text or images, or both, from paper into an electronic signal and to transmit that signal over a regular telephone line, or to transcribe text or images (or both) from an electronic signal received over a regular telephone line onto paper.
   3. The term "telephone solicitation" means the initiation of a telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services, which is transmitted to any person, but such term does not include a call or message
      
      1. to any person with that person's prior express invitation or permission,
      2. to any person with whom the caller has an established business relationship, or
      3. by a tax-exempt nonprofit organization.
   4. The term "established business relationship" means a prior or existing relationship formed by a voluntary two-way communication between a person or entity and a residential subscriber with or without an exchange of consideration, on the basis of an inquiry, application, purchase or transaction by the residential subscriber regarding products or services offered by such person or entity, which relationship has not been previously terminated by either party.
   5. The term "unsolicited advertisement" means any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person's prior express invitation or permission.

  (5) PRIVATE RIGHT OF ACTION.--

A person who has received more than one telephone call within any 12 month period by or on behalf of the same company in violation of the regulations prescribed under this subsection may, if otherwise permitted by the laws or rules of court of a State bring in an appropriate court of that State--

1. an action based on a violation of the regulations prescribed under this subsection to enjoin such violation,
2. an action to recover for actual monetary loss from such a violation, or to receive up to $500 in damages for each such violation, whichever is greater, or
3. both such actions.

  III.B.10: Alternatives to restrict telephone solicitations to residences

As directed by the TCPA, the Commission has considered a number of alternatives for residential telephone subscribers to avoid receiving unwanted telephone solicitations. These include a national database, network technologies, special directory markings, time of day restrictions, and industry-based or company-specific do-not-call lists. The NPRM requested comment, as well as focused cost/benefit analyses, of these and any other methods proposed for protecting the privacy of residential telephone subscribers.

  III.B.22

Commenters opposed to industry-based or company specific do-not-call lists contend that existing industry-based and company-specific lists have not reduced the number of unwanted telephone solicitations, and that Congress has found such efforts ineffective. Further, these commenter argue that these alternatives provide no affirmative method for the consumer to avoid or reject a telemarketer's first call in advance. Moreover, Private Citizen, Inc. (Private Citizen) contends that telemarketers do not always heed an initial do-not-call request, and may call a consumer several times before honoring a consumer's request not to receive further calls or solicitations.

  III.B.23

The legislative history suggests that properly implemented company-specific do-not-call lists would satisfy the statutory requirements of the TCPA. In light of that assertion, and upon weighing the costs and benefits... we conclude that the company-specific do-not-call list is the most effective and efficient means to permit telephone subscribers to avoid unwanted telephone solicitations. ... Additionally, businesses could gain useful information about consumer preferences, and can comply with such preferences without overly burdensome costs or administrative procedures. This alternative would best protect residential subscriber confidentiality, because do-not-call lists would not be universally accessible, and could be verified with a telemarketer's own customer information. Company-specific do-not-call lists would impose the costs of protecting consumer privacy squarely on telemarketers rather than telephone companies or consumers who do not wish to be called. ... In sum, the company-specific do-not-call list alternative represents a careful balancing of the privacy interests of residential telephone subscribers against the commercial speech rights of telemarketers and the continued viability of a valuable business service. For these reasons we, conclude that the company-specific do-not-call list is the alternative that best accomplishes the purposes of the TCPA.

  III.E.1

The TCPA also permits states to initiate a civil action in a federal district court against a telemarketer who engages in a pattern or practice of violations of the TCPA. ... Finally, consumers may request that the commission take enforcement action regarding violations of Section 227, consistent with the Commission's existing complaint procedures.

  Background

3. In adopting rules to implement the TCPA, the Commission noted Congress' instruction that "[i]ndividuals' privacy rights, public safety interests, and commercial freedoms of speech and trade must be balanced in a way that protects the privacy of individuals and permits legitimate telemarketing practices." Congress pointed out that in 1990, more than 30,000 telemarketing firms, employing more than 18 million Americans, generated more than $400 billion in sales. But because unrestricted telemarketing can be an invasion of consumer privacy, and even a risk to public safety, Congress found that a federal law is necessary to control telemarketing practices.

  (Our quibble with the FCC's figures)

The figures we found in Section 2 of the Act actually stated that more than 30,000 businesses use over 300,000 solicitors to call more than 18 million Americans every day. It would to require a broad interpretation to call all these businesses ``telemarketing firms'', and very broad interpretation to consider receiving a telemarketing call as employment. (Although if 14% of the population really were dedicated to making telemarketing calls, answering the phone might well become a full-time job.) We assume that the FCC's statement above was based on some simple confusion.

  This order

4. ...This order addresses arguments made by parties seeking reconsideration or clarification of various matters addressed in the Report and Order. It seeks to balance the concern that consumers' privacy be protected with the imperative that telemarketing practices not be unreasonably hindered.

  The Direct Marketing Association's request

6. ...The DMA and the NAA contend that telemarketers should not be required to give a telephone number or address during a telephone solicitation... DMA's concern over telemarketers' ability to comply with the identification requirement in instances in which the call is terminated by the resident prior to completion of the identification announcement is not persuasive. As discussed above, the telemarketer bears the burden of ensuring that identification is given. We recognize that a resident's hang-up on a solicitation call could thwart telemarketer identification...

  Subscriber identification

8. Subscriber Identification. Commission rules require that telemarketers record do-not- call requests by placing the subscriber's name and telephone number on the "do-not-call list." NAA states that many residents do not wish to give their names when receiving telephone solicitations. It requests that in such instances telemarketers be allowed to record only a phone number and to make a notation when a resident does not wish to give a name to a telemarketer.

9. Section 64.1200(e)(2)(iii) contemplates that telemarketers request the called party's name when making a do-not-call notation. The rule does not require the called party to provide a name. Interpreting the rule more narrowly would defeat the objective of protecting consumer privacy. Therefore, we do not believe it necessary to modify the requirement that solicitors record both a name and number. Telemarketers will not be in violation of the rule so long as they request the called party's name. Indeed, we expect telemarketers to respect the privacy of those who specifically refuse to give a name by simply making a notation to that effect. Nevertheless, as a general rule telemarketers can avoid duplication or confusion in maintaining do-not-call lists if each telephone number is associated with a name to ensure accuracy. Recording callers' names will assist in proving violations of the TCPA, and we note that no consumers, or representative of consumers, shares NAA's concerns in the record before us.

  The ten year rule

15. Decision. We will modify the requirement that a do-not-call request be honored indefinitely, to require that the request be honored for a period of 10 years. Our rules should reflect the fact that residential telephone numbers are recycled. We believe it is reasonable to expect telemarketers to honor do-not-call requests for a period of 10 years. While we acknowledge that a 10-year requirement has not been suggested by any of the parties, we believe that a five-year period, as proposed by DMA and Olan Mills, would not adequately account for the privacy needs of residential telephone subscribers. We also appreciate the concerns of Congressman Markey, but believe the modified 10-year retention requirement will best preserve the careful balance we seek to maintain between residential subscriber privacy and reasonable telemarketing practices. We will monitor the effectiveness of the 10-year retention requirement and readdress the issue if necessary at a later date. Our purpose in prescribing do-not-call lists is to ensure that a consumer's request not to be called is respected. A call made by a telemarketer solely to determine whether a subscriber wishes to receive a telephone solicitation is, in effect, a solicitation from that telemarketer, and accordingly would violate that subscriber's do-not-call request.

  Not more than nominal costs

38. Identification requirements - Telephone number. We reiterate our intent that residential subscribers may not be required to pay for procedures to protect them from unwanted solicitations. Numbers provided for identification purposes in telephone solicitations may not be numbers that require the recipient of a solicitation to incur more than nominal costs for making a do-not-call request (i.e., for which charges exceed costs for transmission of local or ordinary station-to-station long distance calls). In addition to prohibiting charges to protect residential privacy, the TCPA and our rules prohibit calls that impose costs on the called party (e.g., calls to paging and cellular numbers, facsimile advertisements). We now modify the language of Sections 64.1200(e)(2)(iv) and 68.318(c)(3) of the Commission's rules to ensure that the intent of the TCPA and our rules is not thwarted.

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