FTC May Ease Robo-Call Rules

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The Federal Trade Commission plans to file this week for a change to telemarketing rules that would remove an apparent, yet so far unenforced, ban on prerecorded telemarketing calls to consumers.


Under the proposal, prerecorded telemarketing calls that reach consumers would not be considered illegal abandoned or "dead air" calls if the telemarketer has an existing business relationship with the consumer. The FTC will file its proposal in the Federal Register in response to a petition from Voice Mail Broadcasting Corp., Costa Mesa, CA.


During the FTC's July 2003 overhaul of the Telemarketing Sales Rule, which resulted in the national no-call list, the agency declared that telemarketers had to keep call-abandonment rates to 3 percent or less per day. It also stated that prerecorded messages reaching a live consumer would be counted as abandoned calls.


The rule change essentially made prerecorded calls that reached consumers illegal under the TSR. However, prerecorded calls that reached answering machines didn't count as violations.


The FTC rule conflicted with the Federal Communications Commission, which allowed prerecorded calls to consumers with whom the sender has an existing business relationship. Under the change proposed this week, the FTC's rule would become closer to the FCC's rule.


The FTC would let telemarketers send prerecorded messages to existing customers, but impose additional requirements. The messages would have to give consumers the chance to opt out of future calls either by contacting a live representative toll-free or via an automated process.


A public comment period on the proposal will be open until Jan. 20, 2005. During this time, the FTC will not enforce its rules against telemarketers who send prerecorded messages to established customers.


The FTC has not yet filed any enforcement actions against prerecorded-message telemarketers under its call-abandonment rules, said Allen Hile, assistant director of the FTC's division of marketing practices. Before the July 2003 TSR overhaul, the agency had not addressed the issue.


In the Do-Not-Call Implementation Act of 2003, Congress instructed the FCC to "maximize consistency" between its rules and the FTC's, but the FCC hasn't followed through with that directive, Hile said. Meanwhile, Voice Mail Broadcasting made a good case for exempting prerecorded calls to existing customers.


"They made a very persuasive point that the harms this call-abandonment provision is designed to prevent don't arise from this very limited class of recorded-message telemarketing calls," Hile said. "We decided that they're right."


The FTC is also considering a petition from the Direct Marketing Association, which has asked that the FTC limit abandoned calls to 3 percent or less over a 30-day period, instead of each day. This change also would bring the FTC's rules in line with the FCC's, which impose a 3 percent call-abandonment maximum but measure abandonment rates by the month.


Comments can be filed with the FTC online at https://secure.commentworks.com/ftc-tsr.


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