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Congress Passes Fax Bill to Create EBR Exemption

Congress passed a bill that would permanently allow an existing business relationship exemption for commercial faxes, a victory for business media and nonprofit organizations that say they need to fax subscribers and members.

The House of Representative's approval of the bill by voice vote yesterday followed the Senate's passage by unanimous consent June 24. It now remains for President Bush to sign the bill into law. According to American Business Media, a trade press association, Bush is expected to sign the bill this week.

“This is positive action for business media companies,” Gordon T. Hughes II, ABM president/CEO, said in a statement. “A cornerstone of this law, the established business relationship, is an important factor in today's business-to-business communication.”

The issue is less urgent now that the Federal Communications Commission has granted a reprieve to commercial faxers from the implementation of a rule that would require them to get written permission before sending faxes, regardless of their relationship with the recipient. The FCC had planned to enact the rule starting July 1, but on Monday the agency pushed the effective date back to Jan. 9, 2006.

During the 1990s, the FCC considered an existing business relationship to be sufficient for sending commercial faxes. However, over the years some state courts ruled that the Telephone Consumer Protection Act did not provide an exemption for faxing to EBRs, contradicting the FCC's assessment.

In 2003, the FCC issued a ruling revising its prior rules, stating that an EBR was insufficient and that written permission would henceforth be required. Lobbying by companies that fax to EBRs followed. As a result, the FCC pushed back the enactment of its revision on two other occasions.

“Both the refusal of state courts to honor that FCC regulation and the FCC's proposal to do away with it created the need for the new fax law,” ABM said in a statement.

Under the bill sponsored by Sen. Gordon Smith, R-OR, the EBR exemption would be written into law. It also would require opt-out notices on the first page of faxes providing a toll-free, 24-hour contact number that can be used by those who wish to be removed from fax lists. Other provisions include:

· No time limit for EBRs unlike the national no-call list, which limits EBRs to those who made a purchase in the past 18 months or an inquiry in the past three months. After a three-month trial period following enactment of the bill, the FCC could begin proceedings to create such a time limit.

· The FCC also would have the option to exempt nonprofit groups from the opt-out notice requirement.

· Faxers would have to obtain fax numbers either directly from the recipient or from public sources, such as ads, directories and Internet sites. Numbers from other sources would be banned. Numbers already in the possession of faxers would be grandfathered. However, in cases where a faxer has an EBR with a potential recipient but no fax number, the faxer must obtain the number as if the recipient were a new contact.

· The FCC would be required to issue an annual report regarding its enforcement efforts against junk faxes. The General Accountability Office would have to issue a report on the FCC's enforcement efforts 270 days following enactment of the bill.

Scott Hovanyetz covers telemarketing, production and printing and direct response TV marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters

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