Faxers in Limbo as Deadline Nears

With a deadline looming this summer, commercial faxers await word on whether Congress will do away with a rule requiring them to get written permission before sending faxes.

A bill that would establish an existing-business-relationship exemption for commercial faxes, the Junk Fax Prevention Act of 2004, stalled in the Senate in December. The bill died when the last session ended, and a search of bills under consideration in Congress shows that it has not been reintroduced.

A story in the Feb. 14 DM News incorrectly reported that the bill had become law.

A spokesman for Rep. Fred Upton, R-MI, the bill's original sponsor, said that introducing a new version this year was a “priority” but that Upton would wait for the Senate to take the lead this time.

A spokesman for Sen. Gordon Smith, R-OR, primary sponsor of the Senate version of the bill, said he thought a new version could be introduced soon. Issues with Sen. Barbara Boxer, D-CA, who opposed the bill last year, were being worked on, Smith's spokesman said.

However, commercial faxers face a deadline. The Federal Communications Commission is set to begin enforcing the written-permission rule July 1.

Also, faxers remain subject to lawsuits from consumers, state attorneys general or class-action attorneys over their faxing practices. Some state courts, including some in Texas, have never recognized the existing-business-relationship exemption for commercial faxes under the Telephone Consumer Protection Act.

But Mark Priebe, president of Proximity Marketing, Brecksville, OH, said there is reason to be optimistic that the FCC will push back the deadline. His company does work for print publications that depend on faxes for marketing subscriptions and has lobbied the FCC along with a group of marketers and trade groups called the Fax Ban Coalition.

“I don't think the FCC wants to touch this issue,” he said. “I think they realize they made a mistake.”

A reintroduction of the bill likely would bring resistance, particularly from consumer groups that opposed it last year. A compromise might need to be reached with Boxer, who last year said the bill did not give adequate protection to consumers.

A call to Boxer's office was not returned this week. In comments during a Senate debate on the bill last year, Boxer said the FCC's definition of an existing business relationship — any consumer who made a purchase within 18 months or an inquiry within three months — was too loose.

Users of commercial faxes include circulation marketers, trade groups and real estate agents. They worry that a written-permission requirement will cost them large parts of their fax lists and prevent them from communicating with subscribers, members and customers — or even from faxing a quote or a menu to a consumer who requests one orally.

“I'm optimistic, but I'm also a realist,” Priebe said. “If it doesn't pass, then we're going to have to deal with these realities.”

Some faxers are switching to other media but fear inundating the other channels, and they often lack e-mail addresses and telephone numbers for customers, Priebe said. Others have tried getting written permission from customers, but the effort is cost prohibitive, and the percentage of customers willing to give their signatures is low.

Still others are continuing to fax for the moment, taking a chance of attracting a civil suit, Priebe said.

“It's extremely responsive,” he said. “They're willing to take the risk.”

Since the TCPA's establishment in the early 1990s, commercial faxers had held to the standard that it was OK to send faxes to those with whom they had an existing relationship. That standard was set in part by the FCC, which determined that the TCPA exempted faxes to existing customers.

In July 2003, fax marketers were thrown for a loop when the FCC reversed itself, finding that language in the TCPA did not support the exemption. The announcement came as the FCC and Federal Trade Commission revamped the nation's telemarketing rules, including the implementation of the national no-call list, and was little noticed at the time.

Commercial faxers petitioned the FCC to hold off on enforcing its new interpretation of the law. The FCC delayed the initial August 2003 enforcement deadline twice, first pushing it back to Jan. 1, 2005, and then to July 1, 2005.

The Junk Fax Prevention Act of 2004 would have written the existing-business-relationship exemption for commercial faxes into law, and the bill initially was on track for fast passage. But it met resistance in the Senate from Boxer and consumer watchdog groups. The Senate passed the bill, but with an amendment establishing a federal boxing commission. The amendment caused a discrepancy with the House version of the bill that went unresolved and led to the bill's death.

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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