*Pages 1--164 from  Microsoft Word - 29117*
 Federal  Communications  Commission  FCC  03-  153 
 1 
 Before  the  Federal  Communications  Commission 
 Washington,  D.  C.  20554 


 In  the  Matter  of 
 Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991 
 )  ) 
 )  ) 
 )  ) 
 )  ) 
 ) 


 CG  Docket  No.  02-  278 


 REPORT  AND  ORDER 
 Adopted:  June  26,  2003  Released:  July  3,  2003 
 By  the  Commission:  Chairman  Powell,  Commissioners  Abernathy,  Copps  and  Adelstein  issuing  separate  statements. 


 TABLE  OF  CONTENTS 
 Paragraph  Number 
 I.  INTRODUCTION  ...............................................................................................................  1 


 II.  BACKGROUND  .................................................................................................................  4  A.  Telephone  Consumer  Protection  Act  of  1991......................................................................  4 
 B.  TCPA  Rules  .........................................................................................................................  6  C.  Marketplace  Changes  Since  1992........................................................................................  8 
 D.  FTC  National  Do-  Not-  Call  Registry  and  Telemarketing  Rules  ..........................................  9  E.  State  Do-  Not-  Call  Lists  .....................................................................................................  12 
 F.  Notice  of  Proposed  Rulemaking  ........................................................................................  14  G.  Do-  Not-  Call  Implementation  Act  ......................................................................................  15 


 III.  NATIONAL  DO-  NOT-  CALL  LIST  .................................................................................  16  A.  Background........................................................................................................................  16 
 B.  Discussion..........................................................................................................................  25  1.  National  Do-  Not-  Call  Registry....................................................................................  28 
 2.  Exemptions  ..................................................................................................................  42  3.  Section  227(  c)(  3)  Requirements  ..................................................................................  55 
 4.  Constitutionality...........................................................................................................  63  5.  Consistency  with  State  and  FTC  Do-  Not-  Call  Rules  ..................................................  74 
1

 Federal  Communications  Commission  FCC  03-  153 
 2 
 IV.  COMPANY  SPECIFIC  DO-  NOT-  CALL  LISTS..............................................................  86  A.  Background........................................................................................................................  86 
 B.  Discussion..........................................................................................................................  90  1.  Efficacy  of  the  Company-  Specific  Rules.....................................................................  90 
 2.  Amendments  to  the  Company-  Specific  Rules  .............................................................  92 
 V.  INTERPLAY  OF  SECTIONS  222  AND  227....................................................................  97  A.  Background........................................................................................................................  97 
 B.  Discussion........................................................................................................................  100 
 VI.  ESTABLISHED  BUSINESS  RELATIONSHIP  .............................................................  109  A.  Background......................................................................................................................  109 
 B.  Discussion........................................................................................................................  112  1.  Definition  of  Established  Business  Relationship.......................................................  113 
 2.  Telecommunications  Common  Carriers  ....................................................................  119  3.  Interplay  Between  Established  Business  Relationship  and  Do-  Not-  Call 
 Request.......................................................................................................................  124 
 VII.  TAX-  EXEMPT  NONPROFIT  ORGANIZATION  EXEMPTION  .................................  125  A.  Background......................................................................................................................  125 
 B.  Discussion........................................................................................................................  128 
 VIII.  AUTOMATED  TELEPHONE  DIALING  EQUIPMENT  ..............................................  129  A.  Background......................................................................................................................  129 
 B.  Discussion........................................................................................................................  131  1.  Predictive  Dialers.......................................................................................................  131 
 2.  War  Dialing  ............................................................................................................  135 
 IX.  ARTIFICIAL  OR  PRERECORDED  VOICE  MESSAGES............................................  136  A.  Background......................................................................................................................  136 
 B.  Discussion........................................................................................................................  139  1.  Offers  for  Free  Goods  or  Services;  Information-  Only  Messages  ..............................  139 
 2.  Identification  Requirements.......................................................................................  143  3.  Radio  Station  and  Television  Broadcaster  Calls........................................................  145 


 X.  ABANDONED  CALLS...................................................................................................  146  A.  Background......................................................................................................................  146 
 B.  Discussion........................................................................................................................  150  1.  Maximum  Rate  on  Abandoned  Calls.........................................................................  151 
 2.  Two-  Second-  Transfer  Rule........................................................................................  153  3.  Prerecorded  Message  for  Identification.....................................................................  155 
 4.  Established  Business  Relationship.............................................................................  156  5.  Ring  Duration  ............................................................................................................  157 


 XI.  WIRELESS  TELEPHONE  NUMBERS..........................................................................  160  A.  Background......................................................................................................................  160 
2

 Federal  Communications  Commission  FCC  03-  153 
 3 
 B.  Discussion........................................................................................................................  165  1.  Telemarketing  Calls  to  Wireless  Numbers  ................................................................  165 
 2.  Wireless  Number  Portability  and  Pooling  .................................................................  168 
 XII.  CALLER  IDENTIFICATION.........................................................................................  173  A.  Background......................................................................................................................  173 
 B.  Discussion........................................................................................................................  179 
 XIII.  UNSOLICITED  FACSIMILE  ADVERTISEMENTS  ....................................................  185  A.  Background......................................................................................................................  185 
 B.  Discussion........................................................................................................................  187  1.  Prior  Express  Invitation  or  Permission  ......................................................................  187 
 2.  Fax  Broadcasters........................................................................................................  194  3.  Fax  Servers  ................................................................................................................  198 
 4.  Identification  Requirements.......................................................................................  203 
 XIV.  PRIVATE  RIGHT  OF  ACTION  .....................................................................................  204  A.  Background......................................................................................................................  204 
 B.  Discussion........................................................................................................................  206 
 XV.  INFORMAL  COMPLAINT  RULES...............................................................................  207 
 XVI.  TIME  OF  DAY  RESTRICTIONS...................................................................................  208 
 XVII.  ENFORCEMENT  PRIORITIES  .....................................................................................  211 
 XVIII.  OTHER  ISSUES..............................................................................................................  215  A.  Access  to  TCPA  Inquiries  and  Complaints  .....................................................................  215 
 B.  Reports  to  Congress  .........................................................................................................  217 
 XIX.  PROCEDURAL  ISSUES.................................................................................................  218  A.  Regulatory  Flexibility  Act  Analysis  ................................................................................  218 
 B.  Paperwork  Reduction  Act  Analysis.................................................................................  219  C.  Late-  Filed  Comments.......................................................................................................  220 
 D.  Materials  in  Accessible  Formats......................................................................................  221 
 XX.  ORDERING  CLAUSES  ..................................................................................................  222 
 Appendix  A:  Final  Rules  Appendix  B:  Final  Regulatory  Flexibility  Act  Analysis 
 Appendix  C:  Comments  Filed 
3

 Federal  Communications  Commission  FCC  03-  153 
 4 
 I.  INTRODUCTION 
 1.  In  this  Order,  we  revise  the  current  Telephone  Consumer  Protection  Act  (TCPA)  1  rules  and  adopt  new  rules  to  provide  consumers  with  several  options  for  avoiding  unwanted 


 telephone  solicitations.  Specifically,  we  establish  with  the  Federal  Trade  Commission  (FTC)  a  national  do-  not-  call  registry  for  consumers  who  wish  to  avoid  unwanted  telemarketing  calls. 
 The  national  do-  not-  call  registry  will  supplement  the  current  company-  specific  do-  not-  call  rules  for  those  consumers  who  wish  to  continue  requesting  that  particular  companies  not  call  them. 
 To  address  the  more  prevalent  use  of  predictive  dialers,  we  have  determined  that  a  telemarketer  may  abandon  no  more  than  three  percent  of  calls  answered  by  a  person  and  must  deliver  a 
 prerecorded  identification  message  when  abandoning  a  call.  The  new  rules  will  also  require  all  companies  conducting  telemarketing  to  transmit  caller  identification  (caller  ID)  information, 
 when  available,  and  prohibits  them  from  blocking  such  information.  The  Commission  has  revised  its  earlier  determination  that  an  established  business  relationship  constitutes  express 
 invitation  or  permission  to  receive  an  unsolicited  fax,  and  we  have  clarified  when  fax  broadcasters  are  liable  for  the  transmission  of  unlawful  facsimile  advertisements.  We  believe  the 
 rules  the  Commission  adopts  here  strike  an  appropriate  balance  between  maximizing  consumer  privacy  protections  and  avoiding  imposing  undue  burdens  on  telemarketers. 


 2.  It  has  now  been  over  ten  years  since  the  Commission  adopted  a  broad  set  of  rules  that  respond  to  Congresss  directives  in  the  TCPA.  Over  the  last  decade,  the  telemarketing 
 industry  has  undergone  significant  changes  in  the  technologies  and  methods  used  to  contact  consumers.  The  Commission  has  carefully  reviewed  the  record  developed  in  this  rulemaking 
 proceeding.  The  record  confirms  that  these  marketplace  changes  warrant  modifications  to  our  existing  rules,  and  adoption  of  new  rules  if  consumers  are  to  continue  to  receive  the  protections 
 that  Congress  intended  to  provide  when  it  enacted  the  TCPA.  The  number  of  telemarketing  calls  has  risen  steadily;  the  use  of  predictive  dialers  has  proliferated;  and  consumer  frustration  with 
 unsolicited  telemarketing  calls  continues  despite  the  efforts  of  the  states,  the  Direct  Marketing  Association  (DMA),  2  and  the  company-  specific  approach  to  the  problem.  Consumers  often  feel 
 frightened,  threatened,  and  harassed  by  telemarketing  calls.  They  are  angered  by  hang-  ups  and  dead  air  calls,  by  do-  not-  call  requests  that  are  not  honored,  and  by  unsolicited  fax 
 advertisements.  Many  consumers  who  commented  in  this  proceeding  want  something  done  about  unwanted  solicitation  calls,  and  the  vast  majority  of  them  support  the  establishment  of  a 
 national  do-  not-  call  registry.  Congress,  too,  has  responded  by  enacting  the  Do-  Not-  Call  Implementation  Act  (Do-  Not-  Call  Act),  3  authorizing  the  establishment  of  a  national  do-  not-  call 
 registry,  and  directing  this  Commission  to  issue  final  rules  in  its  second  major  TCPA  proceeding  that  maximize  consistency  with  those  of  the  FTC. 


 1  Telephone  Consumer  Protection  Act  of  1991,  Pub.  L.  No.  102-  243,  105  Stat.  2394  (1991),  codified  at  47  U.  S.  C. 
   227.  The  TCPA  amended  Title  II  of  the  Communications  Act  of  1934,  47  U.  S.  C.    201  et  seq. 
 2  The  Direct  Marketing  Association  (DMA)  is  a  trade  association  of  businesses  that  advertise  their  products  and 
 services  directly  to  consumers  by  mail,  telephone,  magazine,  internet,  radio  or  television.  See  also  infra,  note  47. 
 3  Do-  Not-  Call  Implementation  Act,  Pub.  L.  No.  108-  10,  117  Stat.  557  (2003),  to  be  codified  at  15  U.  S.  C.    6101 
 (Do-  Not-  Call  Act). 
4

 Federal  Communications  Commission  FCC  03-  153 
 5 
 3.  The  Commission  recognizes  that  telemarketing  is  a  legitimate  method  of  selling  goods  and  services,  and  that  many  consumers  value  the  savings  and  convenience  it  provides. 
 Thus,  the  national  do-  not-  call  registry  that  we  adopt  here  will  only  apply  to  outbound  telemarketing  calls  and  will  only  include  the  telephone  numbers  of  consumers  who  indicate  that 
 they  wish  to  avoid  such  calls.  Consumers  who  want  to  receive  such  calls  may  instead  continue  to  rely  on  the  company-  specific  do-  not-  call  lists  to  manage  telemarketing  calls  into  their  homes. 
 Based  on  Congresss  directives  in  the  TCPA  and  the  Do-  Not-  Call  Act,  the  substantial  record  developed  in  this  proceeding,  and  on  the  Commissions  own  enforcement  experience,  we  adopt 
 these  amended  rules,  as  described  in  detail  below. 
 II.  BACKGROUND 
 A.  Telephone  Consumer  Protection  Act  of  1991 
 4.  On  December  20,  1991,  Congress  enacted  the  TCPA  in  an  effort  to  address  a  growing  number  of  telephone  marketing  calls  and  certain  telemarketing  practices  thought  to  be 


 an  invasion  of  consumer  privacy  and  even  a  risk  to  public  safety.  4  The  statute  restricts  the  use  of  automatic  telephone  dialing  systems,  artificial  and  prerecorded  messages,  and  telephone 
 facsimile  machines  to  send  unsolicited  advertisements.  Specifically,  the  TCPA  provides  that: 
 It  shall  be  unlawful  for  any  person  within  the  United  States 
 (A)  to  make  any  call  (other  than  a  call  made  for  emergency  purposes  or  made  with  the  prior  express  consent  of  the  called  party)  using  any  automatic  telephone  dialing  system  or 


 an  artificial  or  prerecorded  voice 
 (i)  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); 
 (ii)  to  the  telephone  line  of  any  guest  room  or  patient  room  of  a  hospital,  health  care  facility,  elderly  home,  or  similar  establishment;  or 


 (iii)  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; 
 (B)  to  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  rule  or  order  by  the  Commission  under  paragraph  (2)(  B); 


 (C)  to  use  any  telephone  facsimile  machine,  computer,  or  other  device  to  send  an  unsolicited  advertisement  to  a  telephone  facsimile  machine;  or 


 4  See  TCPA,  Section  2(  5),  reprinted  in  7  FCC  Rcd  2736  at  2744. 
5

 Federal  Communications  Commission  FCC  03-  153 
 6 
 (D)  to  use  an  automatic  telephone  dialing  system  in  such  a  way  that  two  or  more  telephone  lines  of  a  multi-  line  business  are  engaged  simultaneously.  5 
 Under  the  TCPA,  those  sending  fax  messages  or  transmitting  artificial  or  prerecorded  voice  messages  are  subject  to  certain  identification  requirements.  6  The  statute  also  provides  consumers 
 with  several  options  to  enforce  the  restrictions  on  unsolicited  telemarketing,  including  a  private  right  of  action.  7 


 5.  The  TCPA  requires  the  Commission  to  prescribe  regulations  to  implement  the  statutes  restrictions  on  the  use  of  autodialers,  artificial  or  prerecorded  messages  and  unsolicited 
 facsimile  advertisements.  8  The  TCPA  also  requires  the  Commission  to  initiate  a  rulemaking  proceeding  concerning  the  need  to  protect  residential  telephone  subscribers  privacy  rights  and 
 to  consider  several  methods  to  accommodate  telephone  subscribers  who  do  not  wish  to  receive  unsolicited  advertisements,  including  live  voice  solicitations.  9  Specifically,  section  227(  c)(  1) 
 requires  the  Commission  to  compare  and  evaluate  alternative  methods  and  procedures  (including  the  use  of  electronic  databases,  telephone  network  technologies,  special  directory 
 markings,  industry-  based  or  company-  specific  do  not  call  systems,  and  any  other  alternatives,  individually  or  in  combination)  for  their  effectiveness  in  protecting  such  privacy  rights,  and  in 
 terms  of  their  cost  and  other  advantages  and  disadvantages.  10  The  TCPA  specifically  authorizes  the  Commission  to  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 


 5  47  U.  S.  C.    227(  b)(  1). 
 6  47  U.  S.  C.    227(  d)(  1)(  B)  and  (d)(  3)(  A).  See  also  Rules  and  Regulations  Implementing  the  Telephone 
 Consumer  Protection  Act  of  1991,  CC  Docket  No.  92-  90,  Order  on  Further  Reconsideration,  12  FCC  Rcd  4609,  4613,  para.  6  (1997)  (1997  TCPA  Reconsideration  Order),  in  which  the  Commission  found  that  [  s]  ection 


 227(  d)(  1)  of  the  statute  mandates  that  a  facsimile  include  the  identification  of  the  business,  other  entity,  or  individual  creating  or  originating  a  facsimile  message  and  not  the  entity  that  transmits  the  message.  (footnotes 
 omitted). 
 7  The  TCPA  permits  consumers  to  file  suit  in  state  court  if  an  entity  violates  the  TCPA  prohibitions  on  the  use  of 
 facsimile  machines,  automatic  telephone  dialing  systems,  and  artificial  or  prerecorded  voice  messages  and  telephone  solicitation.  47  U.  S.  C.    227(  b)(  3)  and  (c)(  5).  Consumers  may  recover  actual  damages  or  receive  up  to 


 $500  in  damages  for  each  violation,  whichever  is  greater.  If  the  court  finds  that  the  entity  willfully  or  knowingly  violated  the  TCPA,  consumers  may  recover  an  amount  equal  to  not  more  than  three  times  this  amount.  47  U.  S.  C. 
   227(  b)(  3).  Consumers  may  also  bring  their  complaints  regarding  TCPA  violations  to  the  attention  of  the  state  attorney  general  or  an  official  designated  by  the  state.  This  state  entity  may  bring  a  civil  action  on  behalf  of  its 
 residents  to  enjoin  a  person  or  entity  engaged  in  a  pattern  of  telephone  calls  or  other  transmissions  in  violation  of  the  TCPA.  47  U.  S.  C.    227(  f)(  1).  Additionally,  a  consumer  may  request  that  the  Commission  take  enforcement 
 actions  regarding  violations  of  the  TCPA  and  the  regulations  adopted  to  enforce  it.  See  47  C.  F.  R.    1.41  on  informal  requests  for  Commission  action  and  47  C.  F.  R.    1.716  on  the  Commissions  process  for  complaints  filed 
 against  common  carriers. 
 8  47  U.  S.  C.    227(  b)(  2). 


 9  47  U.  S.  C.    227(  c)(  1)-(  4). 
 10  47  U.  S.  C.    227(  c)(  1)(  A). 
6

 Federal  Communications  Commission  FCC  03-  153 
 7 
 solicitations.  11 
 B.  TCPA  Rules 
 6.  In  1992,  the  Commission  adopted  rules  implementing  the  TCPA,  including  the  requirement  that  entities  making  telephone  solicitations  institute  procedures  for  maintaining  do-not- 


 call  lists.  12  Pursuant  to  the  Commissions  rules,  a  person  or  entity  engaged  in  telemarketing  is  required  to  maintain  a  record  of  a  called  partys  request  not  to  receive  future  solicitations  for  a 
 period  of  ten  years.  13  Telemarketers  must  develop  and  maintain  written  policies  for  maintaining  their  lists,  14  and  they  are  required  to  inform  their  employees  of  the  lists  existence  and  train  them 
 to  use  the  list.  15  Commission  rules  prohibit  telemarketers  from  calling  residential  telephone  subscribers  before  8  a.  m.  or  after  9  p.  m.  16  and  require  telemarketers  to  identify  themselves  to 
 called  parties.  17  As  mandated  by  the  TCPA,  the  Commissions  rules  also  establish  general  prohibitions  against  autodialed  calls  being  made  without  prior  express  consent  to  certain 
 locations,  including  emergency  lines  or  health  care  facilities,  18  the  use  of  prerecorded  or  artificial  voice  message  calls  to  residences,  19  line  seizure  by  prerecorded  messages,  20  and  the  transmission 
 of  unsolicited  advertisements  by  facsimile  machines.  21  The  TCPA  rules  provide  that  facsimile  and  prerecorded  voice  transmissions,  as  well  as  telephone  facsimile  machines,  must  meet 
 specific  identification  requirements.  22 
 7.  In  1995  and  1997,  the  Commission  released  orders  addressing  petitions  for  reconsideration  of  the  1992  TCPA  Order.  In  a  Memorandum  Opinion  and  Order  released  on 


 11  47  U.  S.  C.    227(  c)(  3). 
 12  See  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  CC  Docket  No.  92- 
 90,  Report  and  Order,  7  FCC  Rcd  8752  (1992)  (1992  TCPA  Order);  see  also  47  C.  F.  R.    64.1200. 
 13  Initially  telemarketers  were  required  to  honor  a  do-  not-  call  request  indefinitely.  The  Commission  later  modified 
 its  rules  to  require  that  the  request  be  honored  for  a  ten-  year  period.  See  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  CC  Docket  No.  92-  90,  Memorandum  Opinion  and  Order,  10  FCC 


 Rcd  12391,  12397-  98,  para.  14  (1995)  (1995  TCPA  Reconsideration  Order);  47  C.  F.  R.    64.1200(  e)(  2)(  vi). 
 14  47  C.  F.  R.    64.1200(  e)(  2)(  i). 


 15  47  C.  F.  R.    64.1200(  e)(  2)(  ii). 
 16  47  C.  F.  R.    64.1200(  e)(  1). 
 17  47  C.  F.  R.    64.1200(  e)(  2)(  iv). 
 18  47  C.  F.  R.    64.1200(  a)(  1)(  i)-(  iii). 
 19  47  C.  F.  R.    64.1200(  a)(  2). 
 20  47  C.  F.  R.    64.1200(  a)(  4)  and  68.318(  c). 
 21  47  C.  F.  R.    64.1200(  a)(  3). 
 22  47  C.  F.  R.    64.1200(  d)(  1)  and  (2);  47  C.  F.  R.    68.318(  d). 
7

 Federal  Communications  Commission  FCC  03-  153 
 8 
 August  7,  1995,  the  Commission  exempted  from  its  TCPA  rules  calls  made  on  behalf  of  tax-exempt  nonprofit  organizations,  clarified  treatment  of  debt  collection  calls,  and  required 
 telemarketers  to  honor  a  do-  not-  call  request  for  a  period  of  ten  years.  23  The  Commission  also  extended  its  TCPA  rules  to  respond  to  technical  advances  in  computer-  based  facsimile  modems 
 that  enable  solicitors  to  become  fax  broadcasters.  24  On  April  10,  1997,  the  Commission  issued  an  Order  on  Further  Reconsideration  requiring  that  all  facsimile  transmissions  contain  the 
 identifying  information  of  the  business,  other  entity,  or  individual  creating  or  originating  the  facsimile  message,  rather  than  the  entity  that  transmits  the  message.  25 


 C.  Marketplace  Changes  Since  1992 
 8.  The  marketplace  for  telemarketing  has  changed  significantly  in  the  last  decade.  When  the  TCPA  was  enacted  in  1991,  Congress  determined  that  300,000  solicitors  were  used  to 


 telemarket  goods  and  services  to  more  than  18  million  Americans  every  day.  26  Congress  also  found  that  in  1990  sales  generated  through  telemarketing  amounted  to  $435  billion  dollars.  27 
 Some  estimate  that  today  telemarketers  may  attempt  as  many  as  104  million  calls  to  consumers  and  businesses  every  day,  28  and  that  telemarketing  calls  generate  over  $600  billion  in  sales  each 
 year.  29  The  telemarketing  industry  is  considered  the  single  largest  direct  marketing  system  in  the 


 23  1995  TCPA  Reconsideration  Order,  10  FCC  Rcd  at  12397-  401,  paras.  12-  19. 
 24  1995  TCPA  Reconsideration  Order,  10  FCC  Rcd  at  12404-  06,  paras.  27-  31. 
 25  1997  TCPA  Reconsideration  Order,  12  FCC  Rcd  at  4612-  13,  para.  6.  The  Commission  also  [  did]  not  find 
 anything  in  the  TCPA  that  would  prohibit  a  facsimile  broadcast  provider  from  supplying  identification  of  itself  and  the  entity  originating  a  message  if  it  arranges  with  the  message  sender  to  do  so.  Id.  at  4613,  para.  6. 


 26  See  TCPA,  Section  2(  3),  reprinted  in  7  FCC  Rcd  2736  at  2744. 
 27  See  TCPA,  Section  2(  4),  reprinted  in  7  FCC  Rcd  2736  at  2744. 
 28  In  attempting  to  estimate  the  number  of  outbound  marketing  calls  made  each  day  in  the  United  States, 
 representatives  of  the  Direct  Marketing  Association  (DMA)  have  stated  that,  with  as  many  as  1  million  telemarketing  representatives  making  13  calls  an  hour,  working  8  hours  a  day,  it  is  possible  that  104  million 


 outbound  calls  are  made  to  businesses  and  consumers  every  day.  They  noted  that,  of  these  calls,  as  many  as  41%  of  them  may  be  abandoned  (because  they  get  busy  signals,  no  answer,  hang-  ups,  or  answering  machines).  See 
 transcript  from  FTC  Do-  Not-  Call  Forum,  Testimony  of  Jerry  Cerasale,  DMA,  June  6,  2002  at  68.  Another  study  presented  to  the  FTC  during  its  proceeding,  estimates  that  the  annual  number  of  outbound  calls  that  are  answered 
 by  a  consumer  is  16,129,411,765  (i.  e.,  16  billion  calls).  This  figure  does  not  include  those  calls  that  are  abandoned.  James  C.  Miller,  III,  Jonathan  S.  Bowater,  Richard  S.  Higgins,  and  Robert  Budd,  An  Economic 
 Assessment  of  Proposed  Amendments  to  the  Telemarketing  Sales  Rule,  June  5,  2002  at  28,  Att.  1  (prepared  for  the  Consumer  Choice  Coalition  and  its  members,  ACI  Telecentrics,  Coverdell  &  Company,  Discount 
 Development  Services,  HSN  LP  d/  b/  a  HSN  and  Home  Shopping  Network,  Household  Credit  Services,  MBNA  America  Bank,  MemberWorks  Incorporated,  Mortgage  Investors  Corporation,  Optima  Direct,  TCIM  Inc., 
 Trilegiant  Corporation  and  West  Corporation).  See  Telemarketing  Sales  Rule,  Final  Rule,  Federal  Trade  Commission,  68  Fed.  Reg.  4580  at  4629-  30,  n.  591  (Jan.  29,  2003)  (FTC  Order). 


 29  This  figure  represents  telemarketing  sales  to  consumers  and  businesses.  See  Seth  Stern,  Will  feds  tackle 
 telemarketers?  (April  15,  2002)  <http://  www.  csmonitor.  com/  2002/  0415/  p16s01-  wmcn.  html>  (citing  Direct  Marketing  Association  statistics). 
8

 Federal  Communications  Commission  FCC  03-  153 
 9 
 country,  representing  34.6%  of  the  total  U.  S.  sales  attributed  to  direct  marketing.  30  The  number  of  telemarketing  calls,  along  with  the  increased  use  of  various  technologies  to  contact 
 consumers,  has  heightened  public  concern  about  unwanted  telemarketing  calls  and  control  over  the  telephone  network.  Autodialers  can  deliver  prerecorded  messages  to  thousands  of  potential 
 customers  every  day.  Predictive  dialers,  31  which  initiate  phone  calls  while  telemarketers  are  talking  to  other  consumers,  frequently  abandon  calls  before  a  telemarketer  is  free  to  take  the  next 
 call.  32  Using  predictive  dialers  allows  telemarketers  to  devote  more  time  to  selling  products  and  services  rather  than  dialing  phone  numbers,  but  the  practice  inconveniences  and  aggravates 
 consumers  who  are  hung  up  on.  Despite  a  general  ban  on  faxing  unsolicited  advertisements,  33  and  aggressive  enforcement  by  the  Commission,  34  faxed  advertisements  also  have  proliferated, 
 as  facsimile  service  providers  (or  fax  broadcasters)  enable  sellers  to  send  advertisements  to  multiple  destinations  at  relatively  little  cost.  These  unsolicited  faxes  impose  costs  on  consumers, 
 result  in  substantial  inconvenience  and  disruption,  and  also  may  have  serious  implications  for  public  safety.  35 


 30  See  The  Economic  Impact  of  Direct  Marketing  by  Telephone,  a  study  presented  by  Direct  Marketing 
 Association  Telephone  Marketing  Council,  <http://  www.  third-  wave.  net/  economics.  htm>  (visited  July  3,  2002). 
 31  A  predictive  dialer  is  an  automated  dialing  system  that  uses  a  complex  set  of  algorithms  to  automatically  dial 
 consumers  telephone  numbers  in  a  manner  that  predicts  the  time  when  a  consumer  will  answer  the  phone  and  a  telemarketer  will  be  available  to  take  the  call.  Such  software  programs  are  set  up  in  order  to  minimize  the  amount 


 of  downtime  for  a  telemarketer.  In  some  instances,  a  consumer  answers  the  phone  only  to  hear  dead  air  because  no  telemarketer  is  free  to  take  the  call.  See  Telemarketing  Sales  Rule,  Notice  of  Proposed  Rulemaking,  Federal 
 Trade  Commission,  67  Fed.  Reg.  4492  at  4522  (January  30,  2002)  (FTC  Notice). 
 32  Each  telemarketing  company  can  set  its  predictive  dialer  software  for  a  predetermined  abandonment  rate  (i.  e., 
 the  percentage  of  hang-  up  calls  the  system  will  allow).  The  higher  the  abandonment  rate,  the  higher  the  number  of  hang-  up  calls.  High  abandonment  rates  increase  the  probability  that  a  customer  will  be  on  the  line  when  the 


 telemarketer  finishes  each  call.  It  also,  however,  increases  the  likelihood  that  the  telemarketer  will  still  be  on  a  previously  placed  call  and  not  be  available  when  the  consumer  answers  the  phone,  resulting  in  dead  air  or  a 
 hang-  up.  See  FTC  Notice,  67  Fed.  Reg.  at  4523. 
 33  47  U.  S.  C.    227(  b)(  1)(  C)  and  47  C.  F.  R.    64.1200(  a)(  3). 


 34  The  Commission  or  the  Commissions  Enforcement  Bureau  have  issued  forfeiture  orders  totaling  $1.  56  million 
 for  violations  of  the  TCPAs  prohibition  on  unsolicited  fax  advertisements.  The  Commission  has  also  proposed  a  $5,379,000  forfeiture  against  a  fax  broadcaster.  See  Fax.  com,  Inc.  Apparent  Liability  for  Forfeiture,  Notice  of 


 Apparent  Liability  for  Forfeiture,  17  FCC  Rcd  15927  (2002)  (Fax.  com  NAL),  stayed  Missouri  v.  American  Blast  Fax,  No.  4:  00CV933SNL  (E.  D.  Mo.  Aug.  29,  2002).  The  Enforcement  Bureau  has  also  issued  189  citations  for 
 such  prohibited  faxes.  For  a  description  of  the  Commissions  enforcements  actions  involving  the  TCPA,  see  <http://  www.  fcc.  gov/  eb/  tcd/  working.  html>.  Under  section  503  of  the  Act,  the  Commission  is  required  in  an 
 enforcement  action  to  issue  a  warning  citation  to  any  violator  that  does  not  hold  a  Commission  authorization.  Only  if  the  non-  licensee  violator  subsequently  engages  in  conduct  described  in  the  citation  may  the  Commission 
 propose  a  forfeiture,  and  the  forfeiture  may  only  be  issued  as  to  the  subsequent  violations.  See  47  U.  S.  C.    503(  b)(  5),  (b)(  2)(  C). 


 35  See,  e.  g.,  Fax.  com  NAL,  17  FCC  Rcd  at  15932-  33,  para.  9,  which  describes  a  medical  doctors  complaint  about 
 unsolicited  fax  advertisements  he  received  on  a  line  that  is  reserved  for  the  receipt  of  patient  medical  data. 
9

 Federal  Communications  Commission  FCC  03-  153 
 10 
 D.  FTC  National  Do-  Not-  Call  Registry  and  Telemarketing  Rules 
 9.  In  response  to  these  changes  in  the  marketplace,  the  FTC  recently  amended  its  own  rules  to  better  protect  consumers  from  deceptive  and  abusive  telemarketing  practices, 


 including  those  that  may  be  abusive  of  consumers  interest  in  protecting  their  privacy.  On  December  18,  2002,  the  FTC  released  an  order  adopting  a  national  do-  not-  call  registry  to  be 
 maintained  by  the  federal  government  to  help  consumers  avoid  unwanted  telemarketing  calls.  In  that  order,  the  FTC  also  adopted  other  changes  to  its  Telemarketing  Sales  Rule  (TSR),  which  are 
 based  on  its  authority  under  the  1994  Telemarketing  Consumer  Fraud  and  Abuse  Prevention  Act.  36  The  FTCs  amended  TSR  supplements  its  current  company-  specific  do-  not-  call  rules  with 
 a  provision  allowing  consumers  to  stop  unwanted  telemarketing  calls  by  registering  their  telephone  numbers  with  a  national  do-  not-  call  registry  at  no  cost.  Telemarketers  will  be  required 
 to  pay  fees  to  access  the  database  and  to  scrub  their  calling  lists  of  the  telephone  numbers  in  the  database.  37  The  FTCs  list  will  not  cover  those  entities  over  which  it  has  no  jurisdiction, 
 including  common  carriers,  banks,  credit  unions,  savings  and  loans,  companies  engaged  in  the  business  of  insurance,  and  airlines.  38  It  also  will  not  apply  to  intrastate  telemarketing  calls.  In 
 addition,  the  FTC  concluded  that  nonprofit  organizations  are  not  subject  to  the  national  do-  not-call  list;  however,  they  must,  when  using  for-  profit  telemarketers,  comply  with  the  company-specific 
 do-  not-  call  rules.  39 
 10.  The  FTC  indicated  in  its  order  that  it  does  not  intend  the  national  do-  not-  call  registry  to  preempt  state  do-  not-  call  laws.  Instead,  it  will  allow  all  states,  and  the  DMA  if  it  so 


 desires,  to  download  into  the  national  registry  the  telephone  numbers  of  consumers  on  their  lists.  The  FTC  anticipates  a  relatively  short  transition  period  leading  to  one  harmonized  registry,  and 
 said  that  it  will  work  with  the  states  to  coordinate  implementation,  minimize  duplication,  and 
 36  See  FTC  Order,  68  Fed.  Reg.  at  4580.  The  FTC  adopted  its  Telemarketing  Sales  Rule,  16  C.  F.  R.  Part  310,  on 
 August  16,  1995,  pursuant  to  the  Telemarketing  Consumer  Fraud  and  Abuse  Prevention  Act  (Telemarketing  Act),  15  U.  S.  C.    6101-  6108.  The  Telemarketing  Act,  which  was  signed  into  law  on  August  16,  1994,  directed  the 


 FTC  to  issue  a  rule  prohibiting  deceptive  and  abusive  telemarketing  acts  or  practices.  FTC  Notice,  67  Fed.  Reg.  at  4492-  93. 


 37  Scrubbing  refers  to  comparing  a  do-  not-  call  list  to  a  companys  call  list  and  eliminating  from  the  call  list  the 
 telephone  numbers  of  consumers  who  have  registered  a  desire  not  to  be  called. 
 38  Despite  these  jurisdictional  limitations,  the  FTC  stated  that  it  can  reach  telemarketing  activity  conducted  by 
 non-  exempt  entities.  Therefore,  it  maintains  that  when  an  exempt  financial  institution,  telephone  company,  insurance  company,  airline,  or  nonprofit  entity  conducts  its  telemarketing  campaign  using  a  third-  party 


 telemarketer  not  exempt  from  the  amended  TSR,  then  that  campaign  is  subject  to  the  provisions  of  the  TSR.  See  FTC  Order,  68  Fed.  Reg.  4580  at  4587. 


 39  The  FTCs  national  do-  not-  call  registry  and  other  amendments  to  the  TSR  have  been  challenged  on  grounds 
 that  a  national  do-  not-  call  registry  violates  the  First  Amendment  and  that  the  FTC  exceeded  its  statutory  authority  under  the  Telemarketing  Consumer  Fraud  and  Abuse  Prevention  Act.  See  Mainstream  Marketing  Services,  Inc.  v. 


 FTC,  No.  03-  N-  0184  (D.  Colo.  filed  Jan.  29,  2003).  See  also  U.  S.  Security  et  al  v.  FTC,  Civ.  No.  03-  122-  W  (W.  D.  Okla.  filed  Jan.  29,  2003).  On  March  26,  2003,  the  U.  S.  District  Court  for  the  Western  District  of 
 Oklahoma  denied  plaintiffs  Motion  for  Preliminary  Injunction  of  the  FTCs  abandoned  call  rules,  stating  that  plaintiffs  have  failed  to  show  a  substantial  likelihood  that  they  will  prevail  on  the  merits  of  their  challenges  to  the 
 Final  Rule.  See  U.  S.  Security  et  al.  vs.  FTC,  No.  Case  CIV-  03-  122-  W  (W.  D.  Okla.  March  26,  2003). 
10

 Federal  Communications  Commission  FCC  03-  153 
 11 
 maximize  efficiency  for  consumers.  40  The  FTC  has  also  announced  that  online  registration  for  the  do-  not-  call  registry  will  be  available  nationwide  on  or  around  July  1,  2003.  Telephone 
 registration  will  be  open  on  the  same  date  for  consumers  in  states  west  of  the  Mississippi  River  and  open  to  the  entire  country  on  July  8,  2003.  On  October  1,  2003,  the  FTC  and  the  States  will 
 begin  enforcing  the  national  do-  not-  call  provisions  of  the  amended  TSR.  41 
 11.  The  FTC  also  adopted  new  rules  on  the  use  of  predictive  dialers  and  the  transmission  of  caller  ID  information.  The  amended  TSR  prohibits  telemarketers  from 


 abandoning  any  outbound  telephone  call,  and  provides  in  a  safe  harbor  provision,  that  to  avoid  liability,  a  telemarketer  must,  among  several  other  requirements,  abandon  no  more  than  three 
 percent  of  all  calls  answered  by  a  person.  42  Telemarketers  will  also  be  required  to  transmit  the  telephone  number,  and,  when  made  available  by  the  telemarketers  carrier,  the  name  of  the 
 telemarketer,  to  any  caller  identification  service.  43 
 E.  State  Do-  Not-  Call  Lists 
 12.  A  growing  number  of  states  have  also  adopted  or  are  considering  legislation  to  establish  statewide  do-  not-  call  lists.  To  date,  36  states  have  passed  do-  not-  call  statutes,  44  and 


 numerous  others  have  considered  similar  bills.  45  Consumers  remain  enthusiastic  about  do-  not-call  lists,  as  they  continue  to  register  their  telephone  numbers  with  state  lists.  46  State  do-  not-  call 


 40  See  FTC  Order,  68  Fed.  Reg.  4580  at  4641. 
 41  See  FTC  press  materials  at  <http://  www.  ftc.  gov/  opa/  2003/  06/  dncaccelerated.  htm>  (accessed  June  3,  2003). 
 42  See  FTC  Order,  68  Fed.  Reg.  4580  at  4641-  45;  16  C.  F.  R.    310.4(  b)(  1)(  iv)  and  310.4(  b)(  4). 
 43  See  FTC  Order,  68  Fed.  Reg.  4580  at  4623-  28;  16  C.  F.  R.    310.4(  a)(  7). 
 44  Alabama,  Alaska,  Arizona,  Arkansas,  California,  Colorado,  Connecticut,  Florida,  Georgia,  Idaho,  Illinois, 
 Indiana,  Kansas,  Kentucky,  Louisiana,  Maine,  Massachusetts,  Michigan,  Minnesota,  Mississippi,  Missouri,  Montana,  New  Jersey,  New  Mexico,  New  York,  North  Dakota,  Oklahoma,  Oregon,  Pennsylvania,  South  Dakota, 


 Tennessee,  Texas,  Utah,  Vermont,  Wisconsin  and  Wyoming  have  no-  call  laws.  Of  these  states,  Connecticut,  Maine,  Michigan,  Pennsylvania,  Vermont,  and  Wyoming  require  telemarketers  to  use  the  DMAs  Telephone 
 Preference  Service  (TPS)  list.  See  infra  note  47.  Alaskas  statute  requires  telephone  companies  to  place  a  black  dot  in  the  telephone  directory  by  the  names  of  consumers  who  do  not  wish  to  receive  telemarketing  calls. 


 45  States  that  are  considering  laws  to  create  state-  run  do-  not-  call  lists  are  Delaware,  District  of  Columbia,  Hawaii, 
 Iowa,  Maryland,  Michigan,  Nebraska,  Nevada,  North  Carolina,  Ohio,  Rhode  Island,  South  Carolina,  Washington,  and  West  Virginia. 


 46  In  Indiana,  more  than  1,000,000  residential  telephone  numbers  have  been  submitted  to  the  States  do-  not-  call 
 list.  In  Missouri,  more  than  1,000,000  residential  telephone  numbers  are  now  enrolled  in  the  States  do-  not-  call  database,  placing  approximately  40%  of  the  States  households  on  that  States  do-  not-  call  list.  In  Tennessee, 


 762,000  telephone  numbers  have  been  registered,  representing  an  estimated  33%  of  all  households.  In  New  York,  the  number  of  residential  telephone  numbers  enrolled  on  that  States  do-  not-  call  list  is  nearly  2  million. 
 Connecticuts  do-  not-  call  list  contains  nearly  400,000  telephone  numbers,  and  Georgias  is  nearing  360,000.  Colorado  has  977,000  registered  phone  numbers,  almost  half  of  the  number  of  residential  phone  lines  in  the  state. 
 Texas  has  more  than  782,000  registered  phone  lines.  Kentucky  has  740,000  registered  phone  lines,  representing  46%  of  Kentucky  residents.  The  Kansas  list  contains  more  than  367,000  phone  lines.  Approximately  1,600,000 
 residents  enrolled  in  Pennsylvanias  registry  in  less  than  six  weeks.  See  NAAG  Comments  at  6,  n.  5. 
11

 Federal  Communications  Commission  FCC  03-  153 
 12 
 lists  vary  in  the  methods  used  for  collecting  data,  the  fees  charged,  and  the  types  of  entities  required  to  comply  with  their  restrictions.  Some  state  statutes  provide  for  state-  managed  do-  not-call 
 lists,  while  others  require  telemarketers  to  use  the  Direct  Marketing  Associations  Telephone  Preference  Service.  47  In  some  states,  residents  can  register  for  the  do-  not-  call  lists  at  no  charge.  48 
 In  others,  telephone  subscribers  must  pay  a  fee.  For  example,  Georgia  requires  its  residents  to  pay  $5  to  place  their  phone  numbers  on  the  do-  not-  call  list  for  a  period  of  two  years.  49  To 
 register  with  the  Texas  do-  not-  call  list,  residents  must  pay  $2.25  for  three  years.  50  In  most  states,  telemarketers  must  pay  to  access  the  state  do-  not-  call  list  if  they  wish  to  call  residents  in  that 
 state;  however,  such  access  fees  vary  from  state  to  state.  In  Oregon,  telemarketers  must  pay  $120  per  year  to  obtain  the  state  do-  not-  call  list;  51  in  Missouri,  the  fee  is  $600  per  year,  although 
 telemarketers  can  pay  less  if  they  want  only  numbers  from  certain  area  codes.  52  The  state  do-not-  call  statutes  provide  varying  exceptions  to  their  requirements. 


 13.  As  state  legislatures  continue  to  consider  their  own  do-  not-  call  laws,  others  have,  in  anticipation  of  the  national  do-  not-  call  registry,  begun  the  process  of  harmonizing  their  lists 
 with  the  national  list.  The  Illinois  legislature,  for  example,  passed  a  bill  to  reconcile  differences  between  the  state  and  federal  no-  call  laws.  The  measure  would  make  the  FTCs  national  no-  call 
 list  the  official  state  list  for  Illinois  and  would  direct  the  Illinois  Commerce  Commission  to  work  with  local  exchange  providers  on  how  to  inform  consumers  about  the  existence  of  the  list.  53 
 Californias  Attorney  Generals  office  is  allowing  residents  to  pre-  register  for  the  national  registry  on  the  internet,  and  says  it  will  deliver  the  pre-  registered  California  telephone  numbers 
 to  the  FTC  as  soon  as  it  is  ready  to  receive  them.  54  The  FTC  indicated  in  its  order  that  it  will  take  some  time  to  harmonize  the  various  state  do-  not-  call  registries  with  the  national  registry.  55 
 While  some  states  will  be  able  to  transfer  their  state  do-  not-  call  registration  information  by  the  time  telemarketers  first  gain  access  to  the  national  registry,  other  states  may  need  from  12  to  18 


 47  See,  e.  g.,  Wyoming  (Wyo.  Stat.  Ann.    40-  12-  301)  and  Maine  (Me.  Rev.  Stat.  Ann.  tit.  32,    14716  (2003). 
 Established  in  1985,  the  DMAs  Telephone  Preference  Service  (TPS)  is  a  list  of  residential  telephone  numbers  for  consumers  who  do  not  wish  to  receive  telemarketing  calls.  The  DMA  requires  its  members  to  adhere  to  the  list. 


 Telemarketers  who  are  not  members  of  DMA  are  not  required  to  use  the  list,  but  may  purchase  the  TPS  for  a  fee.  See  <http://  www.  dmaconsumers.  org/  offtelephonelist.  html>  (accessed  April  8,  2003). 


 48  See,  e.  g.,  Connecticut  (Conn.  Gen.  Stat.  Ann.    42-  288a);  Indiana  (H.  B.  1222,  to  be  codified  at  Ind.  Code  Ann. 
   24.4.7);  Missouri  (Mo.  Rev.  Stat.    407.1098);  and  Tennessee  (Tenn.  Code  Ann.    65-  4-  404  (2002));  see  also  rules  at  Tenn.  Comp.  R  &  Regs.  Chap.  1220-  4-  11). 


 49  See  Ga.  Code  Ann.    46-  5-  27  (2002);  see  also  rules  at  Ga.  Comp.  R  &  Regs.  R.  515-  14-  1. 
 50  See  H.  B.  472,  to  be  codified  at  Tex.  Bus.  &  Com.  Code  Ann.    43.001. 
 51  See  Or.  Rev.  Stat.    646.574. 
 52  See  Mo.  Rev.  Stat.    407.1098. 
 53  See  Illinois  H.  B.  3407. 
 54  See  <http://  nocall.  doj.  state.  ca.  us/>  (accessed  April  8,  2003). 
 55  See  FTC  Order,  68  Fed.  Reg.  4580  at  4641. 
12

 Federal  Communications  Commission  FCC  03-  153 
 13 
 months  to  achieve  those  results.  56 
 F.  Notice  of  Proposed  Rulemaking 
 14.  On  September  18,  2002,  the  Commission  released  a  Memorandum  Opinion  and  Order  and  Notice  of  Proposed  Rulemaking  seeking  comment  on  whether  the  Commissions  rules 


 need  to  be  revised  in  order  to  carry  out  more  effectively  Congresss  directives  in  the  TCPA.  57  Specifically,  we  sought  comment  on  whether  to  revise  or  clarify  our  rules  governing  unwanted 
 telephone  solicitations  58  and  the  use  of  automatic  telephone  dialing  systems,  59  prerecorded  or  artificial  voice  messages,  60  and  telephone  facsimile  machines.  61  We  also  sought  comment  on  the 
 effectiveness  of  company-  specific  do-  not-  call  lists.  62  In  addition,  we  sought  comment  on  whether  to  revisit  the  option  of  establishing  a  national  do-  not-  call  list  63  and,  if  so,  how  such 
 action  might  be  taken  in  conjunction  with  the  FTCs  proposal  to  adopt  a  national  do-  not-  call  list  and  with  various  state  do-  not-  call  lists.  64  Lastly,  we  sought  comment  on  the  effect  proposed 
 policies  and  rules  would  have  on  small  business  entities,  including  inter  alia  those  that  engage  in  telemarketing  activities  and  those  that  rely  on  telemarketing  as  a  method  to  solicit  new 
 business.  65  Following  the  FTCs  announcement  that  it  had  amended  its  TSR,  the  Commission  extended  the  reply  comment  period  in  this  proceeding  to  ensure  that  all  interested  parties  had 
 ample  opportunity  to  comment  on  possible  Commission  action  in  light  of  the  FTCs  new  rules.  66 
 G.  Do-  Not-  Call  Implementation  Act 
 15.  On  March  11,  2003,  the  Do-  Not-  Call  Act  was  signed  into  law,  authorizing  the 


 56  See  FTC  Order,  68  Fed.  Reg.  4580  at  4641. 
 57  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  Notice  of  Proposed 
 Rulemaking  (NPRM)  and  Memorandum  Opinion  and  Order  (MO&  O),  17  FCC  Rcd  17459,  CG  Docket  No.  02-  278  and  CC  Docket  No.  92-  90  (2002)  (2002  Notice).  In  the  MO&  O,  the  Commission  closed  and  terminated  CC 


 Docket  No.  92-  90  and  opened  a  new  docket  to  address  the  issues  raised  in  this  proceeding. 
 58  2002  Notice,  17  FCC  Rcd  at  17468-  71,  paras.  13-  17. 


 59  2002  Notice,  17  FCC  Rcd  at  17473-  76,  paras.  23-  27. 
 60  2002  Notice,  17  FCC  Rcd  at  17477-  81,  paras.  30-  35. 
 61  2002  Notice,  17  FCC  Rcd  at  17482-  84,  paras.  37-  40. 
 62  2002  Notice,  17  FCC  Rcd  at  17468-  71,  paras.  13-  17. 
 63  2002  Notice,  17  FCC  Rcd  at  17487-  96,  paras.  49-  66. 
 64  See  FTC  Notice,  67  Fed.  Reg.  4492  and  FTC  Order,  68  Fed.  Reg.  4580. 
 65  2002  Notice,  17  FCC  Rcd  at  17497-  501,  paras.  70-  80. 
 66  On  December  20,  2002,  the  Commission  extended  its  reply  comment  period  until  January  31,  2003.  See 
 Consumer  &  Governmental  Affairs  Bureau  Announces  An  Extension  of  Time  To  File  Reply  Comments  on  the  Telephone  Consumer  Protection  Act  (TCPA)  Rules,  Public  Notice,  DA  02-  3554  (rel.  Dec.  20,  2002). 
13

 Federal  Communications  Commission  FCC  03-  153 
 14 
 FTC  to  collect  fees  from  telemarketers  for  the  implementation  and  enforcement  of  a  do-  not-  call  registry.  The  Do-  Not-  Call  Act  also  requires  the  FCC  to  issue  a  final  rule  in  its  ongoing  TCPA 
 proceeding  within  180  days  of  enactment,  and  to  consult  and  coordinate  with  the  FTC  to  maximize  consistency  with  the  rule  promulgated  by  the  FTC.  Congress  recognized  that 
 because  the  FCC  is  bound  by  the  TCPA,  it  would  not  be  possible  for  the  FCC  to  adopt  rules  that  are  identical  to  those  of  the  FTC  in  every  instance.  67  In  those  instances  where  such 
 inconsistencies  exist,  Congress  stated  that  either  the  FTC  or  FCC  must  address  them  administratively  or  Congress  must  address  them  legislatively.  68  The  FTCs  recent  rule  changes 
 expand  that  agencys  regulation  of  telemarketing  activities  and  require  coordination  to  ensure  consistent  and  non-  redundant  federal  enforcement.  The  FCCs  jurisdiction  over  telemarketing 
 practices,  however,  is  significantly  broader  than  the  FTCs.  The  FCC  staff  intends  to  negotiate  a  Memorandum  of  Understanding  between  the  respective  agencies  to  achieve  an  efficient  and 
 effective  enforcement  strategy  that  will  promote  compliance  with  federal  regulations.  The  FCC  is  required  to  report  to  Congress  within  45  days  after  the  issuance  of  final  rules  in  this 
 proceeding,  and  annually  thereafter.  69  The  Commission  released  a  Further  Notice  of  Proposed  Rulemaking  on  March  25,  2003,  seeking  comment  on  the  Do-  Not-  Call  Acts  requirements.  70  By 
 this  Order,  we  are  complying  with  Congresss  directives  to  issue  final  rules  in  our  TPCA  proceeding  within  180  days  of  the  Do-  Not-  Call  Acts  enactment.  Furthermore,  we  have 
 consulted  and  coordinated  with  the  FTC  to  adopt  a  national  do-  not-  call  list  and  other  telemarketing  rules  that  maximize  consistency  with  the  FTCs  amended  Telemarketing  Sales 
 Rule.  71  Pursuant  to  the  requirements  of  the  Do-  Not-  Call  Act,  the  Commission  will  note  the  remaining  inconsistencies  between  the  FCC  and  FTC  rules  in  the  report  to  Congress.  The 
 Commission  will  also  continue  to  work,  within  the  framework  of  the  TCPA,  to  maximize  consistency  with  the  FTCs  rules. 


 III.  NATIONAL  DO-  NOT-  CALL  LIST 
 A.  Background 
 16.  Section  227.  The  TCPA  requires  the  Commission  to  protect  residential  telephone 


 67  See  H.  R.  REP.  No.  108-  8  at  4  (2003),  reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  671. 
 68  Id. 
 69  The  Do-  Not-  Call  Act  provides  that  the  FTC  and  FCC  shall  each  transmit  a  report  to  Congress  which  shall 
 include:  (  1)  an  analysis  of  the  telemarketing  rules  promulgated  by  both  the  Federal  Trade  Commission  and  the  Federal  Communications  Commission;  (2)  any  inconsistencies  between  the  rules  promulgated  by  each  such 


 Commission  and  the  effect  of  any  such  inconsistencies  on  consumers,  and  persons  paying  for  access  to  the  registry;  and  (3)  proposals  to  remedy  any  such  inconsistencies.  See  Do-  Not-  Call  Act,  Sec.  4(  a). 


 70  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  CG  Docket  No.  02-  278, 
 Further  Notice  of  Proposed  Rulemaking,  FCC  03-  62  (rel.  March  25,  2003)  (Further  Notice). 
 71  See  Comments  filed  by  the  FTC  in  response  to  the  Commissions  Further  Notice.  See  also  NARUC  Winter 
 Committee  Meetings,  February  23-  26,  2003,  at  which  FCC  and  FTC  staff  discussed  the  national  do-  not-  call  registry  and  ways  to  harmonize  federal  and  state  programs;  Letter  from  James  Bradford  Ramsay,  NARUC  General 


 Counsel,  to  FCC  filed  March  14,  2003  (NARUC  ex  parte). 
14

 Federal  Communications  Commission  FCC  03-  153 
 15 
 subscribers  privacy  rights  to  avoid  receiving  telephone  solicitations  to  which  they  object.  72  In  so  doing,  section  227(  c)(  1)  directs  the  Commission  to  compare  and  evaluate  alternative 
 methods  and  procedures  including  the  use  of  electronic  databases  and  other  alternatives  in  protecting  such  privacy  rights.  73  Pursuant  to  section  227(  c)(  3),  the  Commission  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.  74  If  the  Commission  determines  that  adoption  of  a  national  database  is  warranted,  section  227(  c)(  3)  enumerates  a  number  of  specific 
 statutory  requirements  that  must  be  satisfied.  75  Additionally,  section  227(  c)(  4)  requires  the  Commission  to  consider  the  different  needs  of  telemarketers  operating  on  a  local  or  regional 
 basis  and  small  businesses.  76  In  addition  to  our  general  authority  over  interstate  communications,  section  2(  b)  of  the  Communications  Act  specifically  provides  the  Commission 
 with  the  authority  to  apply  section  227  to  intrastate  communications.  77 
 17.  TCPA  Order  and  2002  Notice.  The  Commission  initially  considered  the  possibility  of  adopting  a  national  do-  not-  call  database  in  the  1992  TCPA  Order.  At  that  time,  the 


 Commission  declined  to  adopt  a  national  do-  not-  call  registry  citing  concerns  that  such  a  database  would  be  costly  and  difficult  to  establish  and  maintain  in  a  reasonably  accurate  form.  78  The 
 Commission  noted  that  frequent  updates  would  be  required,  regional  telemarketers  would  be  forced  to  purchase  a  national  database,  costs  might  be  passed  on  to  consumers,  and  the 
 information  compiled  could  present  problems  in  protecting  consumer  privacy.  The  Commission  opted  instead  to  implement  an  alternative  approach  requiring  commercial  telemarketers  to 
 maintain  their  own  company-  specific  lists  of  consumers  who  do  not  wish  to  be  called.  79 
 18.  In  the  2002  Notice,  the  Commission  sought  comment  on  whether  to  revisit  its  1992  determination  not  to  adopt  a  national  do-  not-  call  list.  80  As  evidenced  by  the  persistent 


 72  47  U.  S.  C.    227(  c)(  1). 
 73  47  U.  S.  C.    227(  c)(  1)(  A). 
 74  47  U.  S.  C.    227(  c)(  3). 
 75  See  47  U.  S.  C    227(  c)(  3)(  A)-(  L). 
 76  47  U.  S.  C.    227(  c)(  4). 
 77  47  U.  S.  C.    152(  b).  See  also  Texas  v.  American  Blast  Fax,  121  F.  Supp.  2d  1085  at  1087-  89  (W.  D.  Tex.  2000), 
 Minnesota  v.  Sunbelt  Communications  and  Marketing,  Civil  No.  02-  CV-  770  (D.  Minn.  Sept.  4,  2002). 
 78  1992  TCPA  Order,  7  FCC  Rcd  at  8760,  para.  14.  At  that  time  commenters  estimated  the  start-  up  and 
 operational  costs  for  a  national  database  in  the  first  year  could  be  as  high  as  $80  million.  Id.  at  8758,  para.  11. 
 79  See  infra  paras.  86-  96  for  a  discussion  of  the  company-  specific  do-  not-  call  requirements. 


 80  2002  Notice,  17  FCC  Rcd  at  17487-  96,  paras.  49-  66.  On  December  20,  2002,  the  Commission  extended  its 
 reply  comment  period  to  allow  parties  an  opportunity  to  comment  on  the  FTCs  order  establishing  a  national  do-not-  call  database  for  those  entities  over  which  it  has  jurisdiction.  See  Consumer  &  Governmental  Affairs  Bureau 


 Announces  An  Extension  of  Time  To  File  Reply  Comments  on  the  Telephone  Consumer  Protection  Act  (TCPA)  Rules,  Public  Notice,  DA  02-  3554  (rel.  Dec.  20,  2002). 
15

 Federal  Communications  Commission  FCC  03-  153 
 16 
 consumer  complaints  regarding  unwanted  telephone  solicitations,  the  Commission  concluded  that  the  time  was  ripe  to  revisit  this  issue  as  part  of  its  overall  review  of  the  TCPA  rules.  81  In  so 
 doing,  the  Commission  noted  that  the  increasing  number  of  telemarketing  calls  over  the  last  decade,  along  with  the  increased  use  of  various  technologies,  such  as  predictive  dialers,  to 
 contact  consumers,  has  heightened  public  concern  about  unwanted  telemarketing  calls  and  control  over  the  telephone  network.  82  The  Commission  also  noted  that  technological  innovations 
 may  make  the  creation  and  maintenance  of  a  national  do-  not-  call  database  more  viable  than  in  the  past.  Therefore,  the  Commission  sought  comment  on  whether  a  national  do-  not-  call  list 
 should  be  adopted  and,  if  so,  how  such  a  list  could  be  implemented  in  the  most  efficient  and  effective  manner  for  consumers,  businesses,  and  regulators.  The  Commission  noted  that  a 
 national  list  would  provide  consumers  with  a  one-  step  method  for  preventing  unwanted  telemarketing  calls.  This  option  could  be  less  burdensome  for  consumers  than  repeating  requests 
 on  a  case-  by-  case  basis,  particularly  in  light  of  the  number  of  entities  that  conduct  telemarketing  today.  In  particular,  the  Commission  sought  comment  on:  (1)  whether  the  cost,  accuracy,  and 
 privacy  concerns  noted  in  1992  remain  relevant  today;  (2)  the  effectiveness  of  the  company-specific  list  in  protecting  consumer  privacy  rights;  (3)  changes  in  the  technology  or  the 
 marketplace  that  might  influence  this  analysis;  (4)  the  constitutionality  of  a  national  database;  (5)  satisfying  the  statutory  requirements  of  section  227(  c);  and  (6)  the  potential  relationship  of  a 
 national  database  with  the  FTCs  proposed  rules  and  various  state-  adopted  do-  not-  call  registries.  83 


 19.  The  issues  relating  to  the  adoption  and  implementation  of  a  national  do-  not-  call  registry  generated  extensive  comment  from  consumers,  businesses,  and  state  governments. 
 Individual  consumers  and  consumer  interest  groups  overwhelmingly  support  the  adoption  of  a  national  do-  not-  call  list.  84  In  fact,  several  commenters  support  more  restrictive  alternatives  such 
 as  adopting  an  opt-  in  list  for  those  consumers  that  wish  to  receive  telephone  solicitations.  85  Commenters  supporting  a  national  do-  not-  call  list  cite  the  numerous  and  increasing  receipt  of 
 unwanted  telephone  solicitation  calls;  inadequacies  of  the  company-  specific  approach  due  to  the  failure  of  many  telemarketers  to  honor  do-  not-  call  requests  or,  the  impossibility  of  relaying  such 
 requests  in  the  case  of  dead  air  or  hang-  up  calls  initiated  by  predictive  dialers;  the  burdens  of  making  do-  not-  call  requests  for  every  such  call,  particularly  on  the  elderly  and  individuals  with 
 disabilities;  and  the  costs  imposed  on  consumers  in  acquiring  technologies  to  reduce  the  number 


 81  2002  Notice,  17  FCC  Rcd  at  17487-  88,  para.  49  (also  noting  that  the  FTC  had  received  over  40,000  comments 
 in  response  to  its  Notice  on  telemarketing). 
 82  2002  Notice,  17  FCC  Rcd  at  17464,  para.  7,  n.  34  (citing  estimate  that  as  many  as  104  million  outbound  calls  are 
 made  every  day). 
 83  See  2002  Notice,  17  FCC  Rcd  at  17487-  96,  paras.  49-  66. 


 84  See,  e.  g.,  Maureen  Matthews  Comments;  Gloria  Toso  Comments;  Shirley  A.  Weaver  Comments.  See  also 
 ACUTA  Comments  at  2;  NACAA  Comments  at  2;  Telecommunications  for  the  Deaf  Comments  at  4;  NJ  Ratepayer  Further  Comments  at  2. 


 85  See,  e.  g.,  EPIC  Comments  at  2-  5;  Private  Citizens,  Inc.  Comments  at  3;  Teresa  Wilkie  Comments;  Benjamin 
 Philip  Johnson  Comments. 
16

 Federal  Communications  Commission  FCC  03-  153 
 17 
 of  unwanted  calls.  86  Many  such  commenters  argue  that  unwanted  telephone  solicitations  have  reached  the  point  of  harassment  that  constitutes  an  invasion  of  privacy  within  their  homes.  87 
 Others  indicate  that  consumers  are  often  frightened  by  dead-  air  and  hang-  up  calls  generated  by  predictive  dialers  believing  they  are  being  stalked.  88  Several  consumers  indicate  that  they  no 
 longer  answer  their  telephones  or  they  disconnect  the  phone  during  the  day  to  avoid  telemarketing  calls.  These  commenters  support  the  adoption  of  a  one-  step  option  for  those 
 consumers  that  desire  to  reduce  the  number  of  unwanted  solicitation  calls  that  they  receive  each  day. 


 20.  Many  consumers  indicate  that  their  state  lists  have  reduced  the  number  of  unwanted  calls  that  they  receive  and  express  concern  that  any  federal  do-  not-  call  registry  not 
 undermine  the  protections  afforded  by  the  state  do-  not-  call  laws.  89  Assuming  that  a  national  do-not-  call  database  is  adopted,  commenters  encourage  the  Commission  to  work  closely  with  the 
 FTC  to  adopt  a  single  national  registry  that  operates  as  consistently  and  efficiently  as  possible  for  all  interested  parties.  90  State  regulators  generally  support  a  national  database  provided  that  it 
 does  not  preempt  state  do-  not-  call  rules  or  preclude  the  states  from  enforcing  these  laws.  91 
 21.  Industry  representatives  generally  oppose  the  adoption  of  a  national  do-  not-  call  database,  but  some  support  this  approach  provided  the  Commission  adopts  an  established 


 business  relationship  exemption  and  preempts  state  lists.  92  These  commenters  contend  that  the  concerns  noted  by  the  Commission  in  1992,  including  the  costs,  accuracy,  and  privacy  issues 
 involved  in  creating  and  maintaining  such  a  database  remain  valid  today.  93  In  addition,  industry 
 86  See,  e.  g.,  Terry  L.  Krodel  Comments  (disabled  individual  has  difficulty  answering  phone);  Brian  Lawless 
 (contends  that  consumers  should  not  be  forced  to  pay  additional  charges  to  stop  telemarketing  calls);  J.  Raymond  de  Varona  Comments  (telemarketers  hang  up  when  he  requests  to  be  added  to  do-  not  call  list);  Mandy  Burkart 


 Comments  (elderly  grandmother  targeted  by  telemarketers).  See  also  AARP  Comments  at  1  (noting  that  elderly  consumers  are  often  the  subject  of  telemarketing  fraud). 


 87  See,  e.  g.,  Emily  Malek  Comments;  Lester  D.  McCurrie  Comments;  Andrea  Sattler  Comments;  Sandra  S.  West 
 Comments  (receives  as  many  as  20  telemarketing  calls  per  day). 
 88  Edwin  Bailey  Hathaway  Comments;  Cynthia  Stichnoth  Comments. 


 89  See,  e.  g.,  Brenda  J.  Donat  Comments  (cancer  patient  appreciates  reduction  in  calls  due  to  Indiana  Telephone 
 Privacy  Act);  Alice  and  Bill  Frazee  Comments;  Tammy  Puckett  Comments  (Indiana  law  provides  quiet  for  terminally  ill  family  member). 


 90  See,  e.  g.,  Verizon  Comments  at  2;  Bank  of  America  Further  Comments  at  2. 
 91  See,  e.  g.,  NAAG  Comments  at  8-  13;  New  York  State  Consumer  Protection  Board  Comments  at  7;  Ohio  PUC 
 Comments  at  3-  7;  Texas  PUC  Comments  at  10. 
 92  See,  e.  g.,  Bank  of  America  Comments  at  2-  4  (endorse  national  list  provided  it  establishes  a  uniform  national 
 standard  and  retains  established  business  relationship);  Cox  Enterprises  Comments  at  4-  9  (would  not  oppose  national  list  if  established  business  relationship  exemption  is  retained);  Sprint  Comments  at  11-  12  (state  lists 


 should  be  preempted);  Verizon  Wireless  Comments  at  4-  6  (support  national  list  if  state  lists  preempted  and  established  business  relationship  retained).  See  also  DMA  Further  Comments  at  3  (should  preempt  states); 
 DirectTV  Further  Comments  at  3  (preempt);  Nextel  Further  Comments  at  8. 
 93  See,  e.  g.,  MBA  Comments  at  2;  NAII  Comments  at  2;  SBC  Comments  at  6;  WorldCom  Comments  at  17. 
17

 Federal  Communications  Commission  FCC  03-  153 
 18 
 commenters  argue  that  a  national  do-  not-  call  database  is  not  necessary  because  the  current  rules  are  sufficient  to  protect  consumer  privacy  rights.  94  Several  note  the  economic  importance  of 
 telemarketing  and  indicate  that  a  national  registry  would  have  severe  economic  consequences  for  their  industry.  95  Several  industry  representatives  request  specific  exemptions  from  the  national 
 do-  not-  call  requirements  for  newspapers,  magazines,  insurance  companies  and  small  businesses.  96  These  commenters  contend  that  they  provide  valuable  goods  or  services  to  the 
 public  and  that  telemarketing  is  the  most  cost-  effective  means  to  promote  those  services.  97  Representatives  of  various  non-  profit  organizations  oppose  any  extension  of  the  national  do-  not-call 
 rules  to  their  organizations.  98  Several  commenters  argue  that  a  national  registry  would  impose  an  unconstitutional  restriction  on  commercial  speech.  99  They  urge  more  stringent 
 enforcement  of  the  Commissions  current  rules. 
 22.  FTC  Order.  On  December  18,  2002,  the  FTC  released  an  order  establishing  a  national  do-  not  call  registry.  100  The  FTC  cited  an  extensive  record  that  revealed  that  the  current 


 rules  on  telemarketing  were  not  sufficient  to  protect  consumer  privacy.  The  FTCs  do-  not-  call  rules  provide  several  options  for  consumers  to  manage  telemarketing  calls    one  of  which  is  to 
 allow  consumers  who  do  not  want  to  receive  telephone  solicitation  calls  to  register  their  telephone  number  with  a  national  do-  not-  call  database.  101  The  FTC  indicates  that  consumers 
 may  do  so  at  no  cost  by  two  methods:  either  through  a  toll-  free  call  from  the  phone  number  that  they  wish  to  register  or  over  the  Internet.  102  Consumer  registrations  will  remain  valid  for  a 
 period  of  five  years,  with  the  registry  purged  on  a  monthly  basis  of  numbers  that  have  been  disconnected  or  reassigned.  Each  seller  engaged  in  telemarketing  or  on  whose  behalf 
 telemarketing  is  conducted  will  be  required  to  pay  an  annual  fee  for  access  to  the  database  based 


 94  See,  e.  g.,  ABA  Comments  at  7;  BellSouth  Reply  Comments  at  5. 
 95  See,  e.  g.,  Dial  America  Comments  at  15-  18;  Technion  Comments  at  3-  4;  Vector  Comments  at  14-  15. 
 96  See,  e.  g.,  MPA  Comments  at  13-  14;  NAA  Comments  at  12-  14;  Seattle  Times  Comments  at  2;  Vector 
 Comments  at  14-  15. 
 97  See,  e.  g.,  MPA  Comments  at  4,  13-  14;  NAA  Comments  at  13;  PLP  Comments  at  1. 


 98  See,  e.  g.,  March  of  Dimes  Comments  at  2;  Leukemia  and  Lymphoma  Society  Comments;  Special  Olympics 
 Hawaii  Comments  at  2. 
 99  See,  e.  g.,  ATA  Comments  at  58-  91;  SBC  Comments  at  6,  16-  17;  WorldCom  Comments  at  19-  30. 


 100  See  FTC  Order,  68  Fed.  Reg.  at  4628-  33. 
 101  The  FTC  has  awarded  a  contract  to  AT&  T  Government  Solutions  for  $3.  5  million  to  create  the  national 
 registry  of  consumers  who  do  not  want  to  be  contacted  by  telemarketers. 
 102  The  FTC  indicates  that  calls  will  be  answered  by  an  Interactive  Voice  Response  (IVR)  system.  Consumers 
 will  be  directed  to  enter  their  telephone  numbers.  That  number  will  then  be  checked  against  an  automatic  number  information  (ANI)  that  is  transmitted  with  the  call.  Consumers  will  also  be  able  to  verify  or  cancel  their 


 registration  in  the  same  way.  See  FTC  Order,  68  Fed.  Reg.  at  4638-  39. 
18

 Federal  Communications  Commission  FCC  03-  153 
 19 
 on  the  number  of  area  codes  of  data  that  the  company  wishes  to  access.  103  The  only  consumer  information  that  telemarketers  will  receive  from  the  national  registry  is  the  registrants  telephone 
 numbers.  The  FTCs  rules  prohibit  the  sale,  purchase,  rental,  lease,  or  use  of  the  national  registry  for  any  purpose  other  than  compliance  with  the  do-  not-  call  provision.  104 


 23.  The  FTCs  national  do-  not-  call  rules  will  not  apply  to  those  entities  over  which  it  has  no  jurisdiction,  including  common  carriers,  banks,  insurance  companies,  and  airlines.  The 
 FTC  rules  also  will  not  apply  to  intrastate  telemarketing  calls.  In  addition,  the  FTC  exempts  certain  types  of  calls  from  the  national  do-  not-  call  provisions.  Specifically,  the  FTC  has 
 established  exemptions  for  calls  made  by  or  on  behalf  of  charitable  organizations,  105  calls  to  consumers  with  whom  the  seller  has  an  established  business  relationship  106  (as  long  as  the 
 consumer  has  not  asked  to  be  placed  on  the  sellers  company-  specific  do-  not-  call  list),  and  calls  to  businesses.  The  FTC  also  decided  to  retain  the  provision  of  its  rules  that  allows  sellers  to 
 obtain  the  express  agreement  of  consumers  who  wish  to  receive  calls  from  that  seller.  The  FTC  requires  that  such  express  agreement  be  evidenced  by  a  signed,  written  agreement.  As  a  result, 
 consumers  registered  on  the  national  do-  not-  call  list  may  continue  to  receive  calls  from  those  sellers  that  have  acquired  their  express  agreement.  The  FTC  also  adopted  a  safe  harbor  from 
 liability  under  its  do-  not-  call  provisions  concluding  that  sellers  or  telemarketers  that  have  made  a  good  faith  effort  to  provide  consumers  with  an  opportunity  to  exercise  their  do-  not-  call  rights 
 should  not  be  liable  for  violations  that  result  from  an  error.  107  The  FTC  clarified  that  because  wireless  subscribers  are  often  charged  for  the  calls  they  receive,  they  will  be  allowed  to  register 
 their  wireless  telephone  numbers  on  the  national  do-  not-  call  database. 
 24.  The  FTC  concluded  that  it  does  not  intend  its  rules  establishing  a  national  do-  not-call  registry  to  preempt  state  do-  not-  call  laws.  The  FTC  indicated  its  desire  to  work  with  those 


 states  that  have  enacted  such  laws,  as  well  as  this  Commission,  to  articulate  requirements  and 
 103  As  discussed  herein,  the  terms  seller  and  telemarketer  may  refer  to  the  same  entity  or  separate  entities. 
 The  telemarketer  is  the  entity  that  actually  initiates  the  telephone  call.  The  seller  is  the  entity  on  whose  behalf  the  telephone  call  is  being  made.  See  amended  47  C.  F.  R.    64.1200(  f)(  5)  and  (6).  Sellers  may  often  hire 


 telemarketing  entities  to  contact  consumers  on  their  behalf.  See  amended  47  C.  F.  R.    64.1200(  f)(  7)  for  the  definition  of  telemarketing.  Pursuant  to  the  FTCs  do-  not-  call  program,  each  seller  must  pay  for  access  to  the 
 do-  not-  call  database.  Thus,  telemarketing  entities  cannot  share  do-  not-  call  data  among  various  client  sellers. 
 104  See  16  C.  F.  R.    310.4(  b)(  2). 


 105  The  FTC  has  concluded,  however,  that  calls  on  behalf  of  charitable  organizations  will  be  subject  to  the 
 company  specific  do-  not-  call  provisions.  See  FTC  Order,  68  Fed.  Reg.  at  4629. 
 106  The  FTC  defines  an  established  business  relationship  as  a  relationship  between  a  seller  and  consumer  based 
 on:  (1)  the  consumers  purchase,  rental,  or  lease  of  the  sellers  goods  or  services  or  a  financial  transaction  between  the  consumer  and  seller,  within  the  eighteen  months  immediately  preceding  the  date  of  a  telemarketing 


 call;  or  (2)  the  consumers  inquiry  or  application  regarding  a  product  or  service  offered  by  the  seller,  within  the  three  months  immediately  preceding  the  date  of  a  telemarketing  call.  16  C.  F.  R.    310.2(  n).  Regarding  the 
 interplay  between  the  established  business  relationship  and  do-  not-  call  rules,  the  FTC  concluded  that  if  the  consumer  continues  to  do  business  with  the  seller  after  asking  not  to  be  called,  the  consumer  cannot  be  deemed  to 
 have  waived  their  company-  specific  do-  not-  call  request.  FTC  Order,  68  Fed.  Reg.  at  4634. 
 107  See  16  C.  F.  R.    310.4(  b)(  3). 
19

 Federal  Communications  Commission  FCC  03-  153 
 20 
 procedures  during  what  it  anticipates  will  be  a  relatively  short  transition  period  leading  to  one  harmonized  registry  system.  The  FTC  has  articulated  a  goal  whereby  consumers,  in  a  single 
 transaction,  can  register  their  requests  not  to  receive  calls  to  solicit  sales  of  goods  or  services,  and  sellers  and  telemarketers  can  obtain  a  single  list  to  ensure  that  they  do  not  contravene 
 consumer  requests  not  to  be  called.  108 
 B.  Discussion 
 25.  As  discussed  in  greater  detail  below,  we  conclude  that  the  record  compiled  in  this  proceeding  supports  the  establishment  of  a  single  national  database  of  telephone  numbers  of 


 residential  subscribers  who  object  to  receiving  telephone  solicitations.  Consistent  with  the  mandate  of  Congress  in  the  Do-  Not-  Call  Act,  the  national  do-  not-  call  rules  that  we  establish  in 
 this  order  maximize  consistency  with  those  of  the  FTC.  109  The  record  clearly  demonstrates  widespread  consumer  dissatisfaction  with  the  effectiveness  of  the  current  rules  and  network 
 technologies  available  to  protect  consumers  from  unwanted  telephone  solicitations.  110  Indeed,  many  consumers  believe  that  with  the  advent  of  such  technologies  as  predictive  dialers  that  the 
 vices  of  telemarketing  have  become  inherent,  while  its  virtues  remain  accidental.  We  have  compared  and  evaluated  alternative  methods  to  a  national  do-  not-  call  list  for  protecting 
 consumer  privacy  rights  and  conclude  that  these  alternatives  are  costly  and/  or  ineffective  for  both  telemarketers  and  consumers.  111 


 26.  A  national  do-  not-  call  registry  that  is  supplemented  by  the  amendments  made  to  our  existing  rules  will  provide  consumers  with  a  variety  of  options  for  managing  telemarketing 
 calls.  Consumers  may  now:  (1)  place  their  number  on  the  national  do-  not-  call  list;  (2)  continue  to  make  do-  not-  call  requests  of  individual  companies  on  a  case-  by-  case  basis;  and/  or  (3)  register 
 on  the  national  list,  but  provide  specific  companies  with  express  permission  to  call  them.  Telemarketers  may  continue  to  call  individuals  who  do  not  place  their  numbers  on  a  do-  not-  call 
 list  and  consumers  with  whom  they  have  an  established  business  relationship.  We  believe  this  result  is  consistent  with  Congress  directive  in  the  TCPA  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.  112 


 27.  We  agree  with  Congress  that  consistency  in  the  underlying  regulations  and 
 108  FTC  Order,  68  Fed.  Reg.  at  4638-  41. 
 109  See  also  H.  R.  REP.  NO.  108-  8  at  3  (2003),  reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  670  ([  i]  t  is  the  strongly  held 
 view  of  the  Committee  that  a  national  do-  not-  call  list  is  in  the  best  interest  of  consumers,  businesses  and  consumer  protection  authorities.  This  legislation  is  an  important  step  toward  a  one-  stop  solution  to  reducing  telemarketing 


 abuses.). 
 110  See,  e.  g.,  Joseph  A.  Durle  Comments  (forced  to  turn  phone  off  due  to  constant  telemarketing  calls  and  missed 
 call  that  family  member  had  a  stroke);  John  D.  Milhous  Comments;  Gregory  Reichenbach  Comments;  Christopher  C.  Parks  Comments  (receives  numerous  calls  every  day). 


 111  See  47  U.  S.  C.    227(  c)(  1)(  A). 
 112  See  TCPA,  Section  2(  9),  reprinted  in  7  FCC  Rcd  at  2744. 
20

 Federal  Communications  Commission  FCC  03-  153 
 21 
 administration  of  the  national  do-  not-  call  registry  is  essential  to  avoid  consumer  confusion  and  regulatory  uncertainty  in  the  telemarketing  industry.  In  so  doing,  we  emphasize  that  there  will 
 be  one  centralized  national  do-  not-  call  database  of  telephone  numbers.  The  FTC  has  set  up  and  will  maintain  the  national  database,  while  both  agencies  will  coordinate  enforcement  efforts 
 pursuant  to  a  forthcoming  Memorandum  of  Understanding.  113  The  states  will  also  play  an  important  role  in  the  enforcement  of  the  do-  not-  call  rules.  The  FTC  has  received  funding 
 approval  from  Congress  to  begin  implementation  of  the  national  do-  not-  call  registry.  Because  the  FTC  lacks  jurisdiction  over  certain  entities,  including  common  carriers,  banks,  insurance 
 companies,  and  airlines,  those  entities  would  be  allowed  to  continue  calling  individuals  on  the  FTCs  list  absent  FCC  action  exercising  our  broad  authority  given  by  Congress  over 
 telemarketers.  In  addition,  the  FTCs  jurisdiction  does  not  extend  to  intrastate  activities.  Action  by  this  Commission  to  adopt  a  national  do-  not-  call  list,  as  permitted  by  the  TCPA,  requires  all 
 commercial  telemarketers  to  comply  with  the  national  do-  not-  call  requirements,  thereby  providing  more  comprehensive  protections  to  consumers  and  consistent  treatment  of 
 telemarketers. 
 1.  National  Do-  Not-  Call  Registry 
 28.  Pursuant  to  our  authority  under  section  227(  c),  we  adopt  a  national  do-  not-  call  registry  that  will  provide  residential  consumers  with  a  one-  step  option  to  prohibit  unwanted 


 telephone  solicitations.  This  registry  will  be  maintained  by  the  FTC.  Consistent  with  the  FTCs  determination,  the  national  registry  will  become  effective  on  October  1,  2003.  114  Subject  to  the 
 exemptions  discussed  below,  telemarketers  will  be  prohibited  from  contacting  those  consumers  that  register  their  telephone  numbers  on  the  national  list.  In  reaching  this  conclusion,  we  agree 
 with  the  vast  majority  of  consumers  in  this  proceeding  and  the  FTC  that  a  national  do-  not-  call  registry  is  necessary  to  enhance  the  privacy  interests  of  those  consumers  that  do  not  wish  to 
 receive  telephone  solicitations.  In  response  to  the  widespread  consumer  dissatisfaction  with  telemarketing  practices,  Congress  has  recently  affirmed  its  support  of  a  national  do-  not-  call 
 registry  in  approving  funding  for  the  FTCs  national  database.  115  In  so  doing,  Congress  has  indicated  that  this  Commission  should  adopt  rules  that  maximize  consistency  with  those  of  the 
 FTC.  116  The  record  in  this  proceeding  is  replete  with  examples  of  consumers  that  receive 


 113  In  the  FTC  Order,  the  FTC  outlines  in  detail  how  the  national  registry  will  be  administered,  including  how 
 consumers  may  register  and  how  sellers  may  purchase  the  list.  See  also  infra,  Enforcement  Priorities  section,  paras.  211-  214. 


 114  We  decline  to  extend  the  effective  date  for  the  national  do-  not-  call  rules  beyond  October  1,  2003.  See  Ex 
 Parte  Presentations  from  WorldCom  to  FCC,  filed  May  23,  2003  and  June  16,  2003  (advocating  a  9.5-  month  implementation  period  for  the  national  do-  not-  call  list  requirements). 


 115  See  H.  R.  J.  Res.  2,  108  th  Congress  at  96  (2003)  (Consolidated  Appropriations  Resolution).  See  also  H.  R.  REP. 
 NO.  108-  8  at  3  (2003),  reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  670  ([  i]  t  is  the  strongly  held  view  of  the  Committee  that  a  national  do-  not-  call  list  is  in  the  best  interest  of  consumers,  businesses  and  consumer  protection  authorities. 


 This  legislation  is  an  important  step  toward  a  one-  stop  solution  to  reducing  telemarketing  abuses.). 
 116  See  Do-  Not-  Call  Act,  Sec.  3. 
21

 Federal  Communications  Commission  FCC  03-  153 
 22 
 numerous  unwanted  calls  on  a  daily  basis.  117  The  increase  in  the  number  of  telemarketing  calls  over  the  last  decade  combined  with  the  widespread  use  of  such  technologies  as  predictive  dialers 
 has  encroached  significantly  on  the  privacy  rights  of  consumers.  118  For  example,  the  effectiveness  of  the  protections  afforded  by  the  company-  specific  do-  not-  call  rules  have  been 
 reduced  significantly  by  dead  air  and  hang-  up  calls  that  result  from  predictive  dialers.  In  these  situations,  consumers  have  no  opportunity  to  invoke  their  do-  not-  call  rights  and  the  Commission 
 cannot  pursue  enforcement  actions.  As  detailed  previously,  such  intrusions  have  led  many  consumers  to  disconnect  their  phones  during  portions  of  the  day  or  avoid  answering  their 
 telephones  altogether.  The  adoption  of  a  national  do-  call-  list  will  be  an  important  tool  for  consumers  that  wish  to  exercise  control  over  the  increasing  number  of  unwanted  telephone 
 solicitation  calls. 
 29.  Although  some  industry  commenters  attempt  to  characterize  unwanted  solicitation  calls  as  petty  annoyances  and  suggest  that  consumers  purchase  certain  technologies 


 to  block  unwanted  calls,  the  evidence  in  this  record  leads  us  to  believe  the  cumulative  effect  of  these  disruptions  in  the  lives  of  millions  of  Americans  each  day  is  significant.  As  a  result,  we 
 conclude  that  adoption  of  a  national  do-  not-  call  list  is  now  warranted.  We  believe  that  consumers  should,  at  a  minimum,  be  given  the  opportunity  to  determine  for  themselves  whether 
 or  not  they  wish  to  receive  telephone  solicitation  calls  in  their  homes.  The  national  do-  not-  call  list  will  serve  as  an  option  for  those  consumers  who  have  found  the  company-  specific  list  and 
 other  network  technologies  ineffective.  The  telephone  network  is  the  primary  means  for  many  consumers  to  remain  in  contact  with  public  safety  organizations  and  family  members  during 
 times  of  illness  or  emergency.  Consumer  frustration  with  telemarketing  practices  has  reached  a  point  in  which  many  consumers  no  longer  answer  their  telephones  while  others  disconnect  their 
 phones  during  some  hours  of  the  day  to  maintain  their  privacy.  We  agree  with  consumers  that  incessant  telephone  solicitations  are  especially  burdensome  for  the  elderly,  disabled,  and  those 
 that  work  non-  traditional  hours.  119  Persons  with  disabilities  are  often  unable  to  register  do-  not-call  requests  on  many  company-  specific  lists  because  many  telemarketers  lack  the  equipment 
 necessary  to  receive  that  request.  120  Given  the  record  evidence,  along  with  Congresss  recent  affirmative  support  for  a  national  do-  not-  call  registry,  we  adopt  a  national  do-  not-  call  registry.  121 


 117  See,  e.  g.,  Sean  Herriott  Comments  (receives  numerous  telemarketing  calls  each  day);  Lester  D.  McCurrie 
 (receives  between  8-  12  call  per  day);  David  K.  McClain  Comments;  Greg  Rademacher  Comments  (receives  so  many  calls  that  he  now  refuses  to  answer  the  phone);  John  Rinderle  Comments;  Steven  D.  Thorton  Comments; 


 Sandra  West  Comments  (receives  20  calls  per  day). 
 118  See  supra  para.  8. 


 119  See,  e.  g.,  Karen  M.  Meyer  Comments  (86  year-  old  receives  as  many  as  10  solicitation  calls  per  day);  Vivian 
 Sinclair  Comments  (85  year  old  with  cane  receives  numerous  telephone  solicitations);  Mr.  and  Mrs.  Joseph  Stephanik  Comments  (works  at  night  and  telemarketing  calls  interfere  with  sleep);  Mavis  Selway  Comments 


 (husband  who  works  at  night  must  answer  telemarketing  calls  during  day). 
 120  See  Telecommunications  for  the  Deaf  Comments  at  2-  3  (noting  that  telemarketers  often  lack  TTY  or 
 telecommunications  relay  service). 
 121  See  H.  R.  REP.  NO.  108-  8  at  3  (2003),  reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  670  ([  i]  t  is  the  strongly  held  view 
 of  the  Committee  that  a  national  do-  not-  call  list  is  in  the  best  interest  of  consumers,  businesses  and  consumer  protection  authorities.). 
22

 Federal  Communications  Commission  FCC  03-  153 
 23 
 As  discussed  more  fully  below,  however,  we  are  mindful  of  the  need  to  balance  the  privacy  concerns  of  consumers  with  the  interests  of  legitimate  telemarketing  practices.  Therefore,  we 
 have  provided  for  certain  exemptions  to  the  national  do-  not-  call  registry. 
 30.  While  we  agree  that  concerns  regarding  the  cost,  accuracy,  and  privacy  of  a  national  do-  not-  call  database  remain  relevant,  we  believe  that  circumstances  have  changed 


 significantly  since  the  Commission  first  reviewed  this  issue  over  a  decade  ago  such  that  they  no  longer  impose  a  substantial  obstacle  to  the  implementation  of  a  national  registry.  As  several 
 commenters  in  this  proceeding  note,  advances  in  computer  technology  and  software  now  make  the  compilation  and  maintenance  of  a  national  database  a  more  reasonable  proposition.  122  In 
 addition,  considerable  experience  has  been  gained  through  the  implementation  of  many  state  do-not-  call  lists.  In  1992,  it  was  estimated  by  some  commenters  that  the  cost  of  establishing  such  a 
 list  in  the  first  year  could  be  as  high  as  $80  million.  As  noted  above,  Congress  has  recently  reviewed  and  approved  the  FTCs  request  for  $18.1  million  to  fund  the  national  do-  not-  call 
 list.  123  We  believe  that  the  advent  of  more  efficient  technologies  and  the  experience  acquired  in  dealing  with  similar  databases  at  the  state  level  is  responsible  for  this  substantial  reduction  in 
 cost. 
 31.  Similarly,  we  believe  that  technology  has  become  more  proficient  in  ensuring  the  accuracy  of  a  national  database.  The  FTC  indicates  that  to  guard  against  the  possibility  of 


 including  disconnected  or  reassigned  telephone  numbers,  technology  will  be  employed  on  a  monthly  basis  to  check  all  registered  telephone  numbers  against  national  databases,  and  remove 
 those  numbers  that  have  been  disconnected  or  reassigned.  124  The  length  of  time  that  registrations  remain  valid  also  directly  affects  the  accuracy  of  the  registry  as  telephone  numbers  change  hands 
 over  time.  As  discussed  more  fully  below,  we  conclude  that  the  retention  period  for  both  the  national  and  company-  specific  do-  not-  call  requests  will  be  five  years.  125  This  is  consistent  with 
 the  FTCs  determination  and  our  own  record  that  reveals  that  the  current  ten-  year  retention  period  for  company-  specific  requests  is  too  long  given  changes  in  telephone  numbers. 
 Consumers  must  also  register  their  do-  not-  call  requests  from  either  the  telephone  number  of  the  phone  that  they  wish  to  register  or  via  the  Internet.  The  FTC  will  confirm  the  accuracy  of  such 
 registrations  through  the  use  of  automatic  number  identification  (ANI)  126  and  other  technologies.  We  believe  that  a  five-  year  registration  period  coupled  with  a  monthly  purging  of  disconnected 


 122  See,  e.  g.,  LSSi  Comments  at  5-  6;  NCS  Comments  at  2-  4. 
 123  As  noted  above,  the  FTC  has  awarded  a  contract  to  AT&  T  Government  Solutions  for  $3.5  million  to  create  the 
 national  registry.  The  Congressional  Budget  Office  estimates  that  the  FTC  will  collect  and  spend  a  total  of  about  $73  million  in  fees  over  2003-  2008  to  implement  the  national  database.  See  H.  R.  REP.  NO.  108-  8  at  6  (2003), 


 reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  673. 
 124  FTC  Order,  68  Fed.  Reg.  at  4640. 


 125  See  FTC  Order,  68  Fed.  Reg.  at  4640.  Our  rules  previously  required  a  company-  specific  do-  not-  call  request  to 
 be  honored  for  ten  years.  See  47  C.  F.  R.    64.1200(  e)(  2)(  vi). 
 126  The  term  ANI  refers  to  the  delivery  of  the  calling  partys  billing  number  by  a  local  exchange  carrier  to  any 
 interconnecting  carrier  for  billing  or  routing  purposes,  and  to  the  subsequent  delivery  of  such  number  to  end  users.  47  C.  F.  R.    64.1600(  b). 
23

 Federal  Communications  Commission  FCC  03-  153 
 24 
 telephone  numbers  adequately  balances  the  need  to  maintain  accuracy  in  the  national  registry  with  any  burden  imposed  on  consumers  to  re-  register  periodically  their  telephone  numbers. 
 32.  We  conclude  that  appropriate  action  has  been  taken  to  ensure  the  privacy  of  those  registering  on  the  national  list.  Specifically,  the  only  consumer  information  telemarketers  and 
 sellers  will  receive  from  the  national  registry  is  the  registrants  telephone  number.  127  This  is  the  minimum  amount  of  information  that  can  be  provided  to  implement  the  national  registry.  We 
 note  that  the  majority  of  telephone  numbers  are  publicly  available  through  telephone  directories.  To  the  extent  that  consumers  have  an  unlisted  number,  the  consumer  will  have  to  make  a  choice 
 as  to  whether  they  prefer  to  register  on  a  national  do-  not-  call  list  or  maintain  complete  anonymity.  We  reiterate,  however,  that  the  only  information  that  will  be  provided  to  the 
 telemarketer  is  the  telephone  number  of  the  consumer.  128  No  corresponding  name  or  address  information  will  be  provided.  We  believe  that  this  approach  reduces  the  privacy  concerns  of 
 such  consumers  to  the  greatest  extent  possible.  As  an  additional  safeguard,  we  find  that  restrictions  should  be  imposed  on  the  use  of  the  national  list.  Consistent  with  the  FTCs 
 determination  and  section  227(  c)(  3)(  K),  we  conclude  that  no  person  or  entity  may  sell,  rent,  lease,  purchase,  or  use  the  national  do-  not-  call  database  for  any  purpose  except  compliance  with 
 section  227  and  any  such  state  or  federal  law  to  prevent  telephone  solicitations  to  telephone  numbers  on  such  list.  129  We  conclude  that  these  safeguards  adequately  protect  the  privacy  rights 
 of  those  consumers  who  choose  to  register  on  the  national  do-  not-  call  list. 
 33.  We  conclude  that  the  national  database  should  allow  for  the  registration  of  wireless  telephone  numbers,  and  that  such  action  will  better  further  the  objectives  of  the  TCPA 


 and  the  Do-  Not-  Call  Act.  In  so  doing,  we  agree  with  the  FTC  and  several  commenters  that  wireless  subscribers  should  not  be  excluded  from  the  protections  of  the  TCPA,  particularly  the 
 option  to  register  on  a  national-  do-  not-  call  list.  130  Congress  has  indicated  its  intent  to  provide  significant  protections  under  the  TCPA  to  wireless  users.  131  Allowing  wireless  subscribers  to 
 register  on  a  national  do-  not-  call  list  furthers  the  objectives  of  the  TCPA,  including  protection  for  wireless  subscribers  from  unwanted  telephone  solicitations  for  which  they  are  charged. 


 34.  Nextel  argues,  however,  that,  because  the  TCPA  only  authorizes  the  Commission  to  regulate  solicitations  to  residential  telephone  subscribers,    wireless  subscribers 


 127  FTC  Order,  68  Fed.  Reg.  at  4640. 
 128  As  noted  above,  the  seller  and  telemarketer  may  be  the  same  entity  or  separate  entities.  Each  entity  on 
 whose  behalf  the  telephone  call  is  being  made  must  purchase  access  to  the  do-  not-  call  database. 
 129  See  47  U.  S.  C.    227(  c)(  3)(  K).  See  also  16  C.  F.  R.    310.4(  b)(  2).  We  also  note  that  telemarketers  will  be 
 prohibited  from  selling  the  list  to  others  or  dividing  the  costs  of  accessing  the  list  among  various  client  sellers.  Such  action  would  threaten  the  financial  support  for  maintaining  the  database. 


 130  See,  e.  g.,  AT&  T  Wireless  Reply  Comments  at  22;  Charles  Ferguson  Comments;  City  of  New  Orleans 
 Comments  at  12;  Texas  Office  of  Public  Utility  Counsel  Comments  at  7.  See  also  NAAG  Comments  at  35-  36  contending  that  public  safety  implications  may  arise  if  wireless  consumers  receive  unsolicited  marketing  calls 


 while  operating  automobiles. 
 131  47  U.  S.  C.    227(  b)(  1)(  iii). 
24

 Federal  Communications  Commission  FCC  03-  153 
 25 
 may  not  participate  in  the  do-  not-  call  list.  132  Nextel  states  we  should  define  residential  subscribers  to  mean  telephone  service  used  primarily  for  communications  in  the  subscribers 
 residence.  133  However,  Nextels  application  would  result  in  [  a]  t  most,  the  Commission  [having  the]  authority  to  regulate  solicitations  to  wireless  subscribers  in  those  circumstances  where 
 wireless  service  actually  has  displaced  a  residential  land  line,  and  functions  as  a  consumers  primary  residential  telephone  service.  134 


 35.  Nextels  definition  of  residential  subscribers  is  far  too  restrictive  and  inconsistent  with  the  intent  of  section  227.  Specifically,  there  is  nothing  in  section  227  to 
 suggest  that  only  a  customers  primary  residential  telephone  service  was  all  that  Congress  sought  to  protect  through  the  TCPA.  In  addition,  had  Congress  intended  to  exclude  wireless 
 subscribers  from  the  benefits  of  the  TCPA,  it  knew  how  to  address  wireless  services  or  consumers  explicitly.  For  example,  in  section  227(  b)(  1),  Congress  specifically  prohibited  calls 
 using  automatic  telephone  dialing  systems  or  artificial  or  prerecorded  voice  to  telephone  numbers  assigned  to  paging  service  [or]  cellular  telephone  service  .  .  .  .  Moreover,  under 
 Nextels  definition,  even  consumers  who  use  their  wireless  telephone  service  in  their  homes  to  supplement  their  residential  wireline  service,  such  as  by  using  their  wireless  telephone  service  to 
 make  long  distance  phone  calls  to  avoid  wireline  toll  charges,  would  be  excluded  from  the  protections  of  the  TCPA.  Such  an  interpretation  is  at  odds  even  with  Nextels  own  reasoning  for 
 its  definition    that  the  TCPAs  goal  is  to  curb  the  pervasive  use  of  telemarketing  to  market  goods  and  services  to  the  home.  135  As  described,  it  is  well-  established  that  wireless  subscribers 
 often  use  their  wireless  phones  in  the  same  manner  in  which  they  use  their  residential  wireline  phones.  136  Indeed,  as  even  Nextel  recognizes,  there  is  a  growing  number  of  consumers  who  no 
 longer  maintain  wireline  phone  service,  and  rely  only  on  their  wireless  telephone  service.  Thus,  we  are  not  persuaded  by  Nextels  arguments. 


 36.  Moreover,  we  believe  it  is  more  consistent  with  the  overall  intent  of  the  TCPA  to 
 132  Nextel  Comments  at  19.  We  note  that  section  227(  c  )(  1)  uses  the  phrase  residential  telephone  subscribers 
 and  that  section  227(  c)(  3),  which  more  specifically  discusses  the  do-  not-  call  database,  uses  the  phrase  residential  subscribers.  Neither  of  these  terms  is  defined  in  the  TCPA.  Thus,  we  see  no  basis  in  the  legislative  language  or 


 history  for  considering  them  to  be  materially  different.  Nor  do  we  see  a  basis  for  distinction  in  common  usage.  Therefore,  we  will  interpret  them  to  be  synonymous  and  will  refer  to  both  by  using  the  term  residential 
 subscribers. 
 133  Nextel  Comments  at  19. 


 134  Nextel  Comments  at  21. 
 135  Nextel  Comments  at  20. 
 136  For  example,  the  Commission  recently  relied  on  wireless  broadband  PCS  substitution  to  support  Track  A 
 findings  in  two  section  271  proceedings  where  residential  customers  in  New  Mexico  and  Nevada  had  replaced  their  landline  service  with  wireless  service.  See  Application  by  SBC  Communications  Inc.,  Nevada  Bell 


 Telephone  Company,  and  Southwestern  Bell  Communications  Services,  Inc.,  for  Authorization  to  Provide  In-Region,  InterLATA  Services  in  Nevada,  WC  Docket  No.  03-  10,  Memorandum  Opinion  and  Order,  FCC  03-  80  at 
 paras.  16  -  26  (rel.  April  14,  2003);  see  also  Federal  Communications  Commission,  Seventh  Annual  Report  and  Analysis  of  Competitive  Market  Conditions  With  Respect  to  Commercial  Mobile  Services  at  32-  36  (Seventh 
 Annual  CMRS  Competition  Report). 
25

 Federal  Communications  Commission  FCC  03-  153 
 26 
 allow  wireless  subscribers  to  benefit  from  the  full  range  of  TCPA  protections.  As  indicated  above,  Congress  afforded  wireless  subscribers  particular  protections  in  the  context  of  autodialers 
 and  prerecorded  calls.  137  In  addition,  although  Congress  expressed  concern  with  residential  privacy,  it  also  was  concerned  with  the  nuisance,  expense  and  burden  that  telephone  solicitations 
 place  on  consumers.  138  Therefore,  we  conclude  that  wireless  subscribers  may  participate  in  the  national  do-  not-  call  list.  As  a  practical  matter,  since  determining  whether  any  particular  wireless 
 subscriber  is  a  residential  subscriber  may  be  more  fact-  intensive  than  making  the  same  determination  for  a  wireline  subscriber,  we  will  presume  wireless  subscribers  who  ask  to  be  put 
 on  the  national  do-  not-  call  list  to  be  residential  subscribers.  139  Such  a  presumption,  however,  may  require  a  complaining  wireless  subscriber  to  provide  further  proof  of  the  validity  of  that 
 presumption  should  we  need  to  take  enforcement  action. 
 37.  We  emphasize  that  it  is  not  our  intent  in  adopting  a  national  do-  not-  call  list  to  prohibit  legitimate  telemarketing  practices.  We  believe  that  industry  commenters  present  a  false 


 choice  between  the  continued  viability  of  the  telemarketing  industry  and  the  adoption  of  a  national  do-  not-  call  list.  We  are  not  persuaded  that  the  adoption  of  a  national  do-  not-  call  list  will 
 unduly  interfere  with  the  ability  of  telemarketers  to  contact  consumers.  Many  consumers  will  undoubtedly  take  advantage  of  the  opportunity  to  register  on  the  national  list.  Several  industry 
 commenters  suggest,  however,  that  consumers  derive  substantial  benefits  from  telephone  solicitations.  If  so,  many  such  consumers  will  choose  not  to  register  on  the  national  do-  not-  call 
 list  and  will  opt  instead  to  make  do-  not-  call  requests  on  a  case-  by-  case  basis  or  give  express  permission  to  be  contacted  by  specific  companies.  140  In  addition,  as  discussed  further  below,  we 
 have  provided  for  certain  exemptions  to  the  do-  not-  call  registry  in  recognition  of  legitimate  telemarketing  business  practices.  For  example,  sellers  of  goods  or  services  via  telemarketing 
 may  continue  to  contact  consumers  on  the  national  list  with  whom  they  have  an  established  business  relationship.  We  also  note  that  calls  that  do  not  fall  within  the  definition  of  telephone 
 solicitation  as  defined  in  section  227(  a)(  3)  will  not  be  precluded  by  the  national  do-  not-  call  list.  These  may  include  surveys,  market  research,  political  or  religious  speech  calls.  141  The  national 
 do-  not-  call  rules  will  also  not  prohibit  calls  to  businesses  and  persons  with  whom  the  marketer  has  a  personal  relationship.  Telemarketers  may  continue  to  contact  all  of  these  consumers 


 137  47  U.  S.  C.    227(  b)(  1)(  A)(  iii). 
 138  S.  REP.  NO.  102-  178  at  1  (noting  that  telephone  solicitations  are  both  a  nuisance  and  an  invasion  of  privacy). 
 139  This  presumption  is  only  for  the  purposes  of  section  227  and  is  not  in  any  way  indicative  of  any  attempt  to 
 classify  or  regulate  wireless  carriers  for  purposes  of  other  parts  of  Title  II. 
 140  We  also  note  that  numerous  alternative  marketing  outlets  remain  available  to  sellers,  such  as  newspapers, 
 television,  radio,  and  direct  mail. 
 141  Such  calls  may  be  prohibited  if  they  serve  as  a  pretext  to  an  otherwise  prohibited  advertisement  or  a  means  of 
 establishing  a  business  relationship.  Moreover,  responding  to  such  a  survey  does  not  constitute  express  permission  or  establish  a  business  relationship  exemption  for  purposes  of  a  subsequent  telephone  solicitation.  See 


 H.  R.  REP.  NO.  102-  317  at  13  ([  T]  he  Committee  does  not  intend  the  term  telephone  solicitation  to  include  public  opinion  polling,  consumer  or  market  surveys,  or  other  survey  research  conducted  by  telephone.  A  call 
 encouraging  a  purchase,  rental,  or  investment  would  fall  within  the  definition,  however,  even  though  the  caller  purports  to  be  taking  a  poll  or  conducting  a  survey.). 
26

 Federal  Communications  Commission  FCC  03-  153 
 27 
 despite  the  adoption  of  a  national  do-  not-  call  list.  Furthermore,  we  decline  to  adopt  more  restrictive  do-  not-  call  requirements  on  telemarketers  as  suggested  by  several  commenters.  For 
 example,  we  decline  to  adopt  an  opt-  in  approach  that  would  ban  telemarketing  to  any  consumer  who  has  not  expressly  agreed  to  receive  telephone  solicitations.  We  believe  that 
 establishing  such  an  approach  would  be  overly  restrictive  on  the  telemarketing  industry.  As  discussed  more  fully  below,  we  also  decline  to  extend  the  national  do-  not-  call  requirements  to 
 tax-  exempt  nonprofit  organizations  or  entities  that  telemarket  on  behalf  of  nonprofit  organizations. 


 38.  We  agree  with  the  FTC  that  a  safe  harbor  should  be  established  for  telemarketers  that  have  made  a  good  faith  effort  to  comply  with  the  national  do-  not  call  rules.  142  A  seller  or 
 telemarketer  acting  on  behalf  of  the  seller  that  has  made  a  good  faith  effort  to  provide  consumers  with  an  opportunity  to  exercise  their  do-  not-  call  rights  should  not  be  liable  for  violations  that 
 result  from  an  error.  Consistent  with  the  FTC,  we  conclude  that  a  seller  or  the  entity  telemarketing  on  behalf  of  the  seller  will  not  be  liable  for  violating  the  national  do-  not-  call  rules 
 if  it  can  demonstrate  that,  as  part  of  the  sellers  or  telemarketers  routine  business  practice:  (i)  it  has  established  and  implemented  written  procedures  to  comply  with  the  do-  not-  call  rules;  (ii)  it 
 has  trained  its  personnel,  and  any  entity  assisting  in  its  compliance,  in  the  procedures  established  pursuant  to  the  do-  not-  call  rules;  (iii)  the  seller,  or  telemarketer  acting  on  behalf  of  the  seller,  has 
 maintained  and  recorded  a  list  of  telephone  numbers  the  seller  may  not  contact;  (iv)  the  seller  or  telemarketer  uses  a  process  to  prevent  telemarketing  to  any  telephone  number  on  any  list 
 established  pursuant  to  the  do-  not-  call  rules  employing  a  version  of  the  do-  not-  call  registry  obtained  from  the  administrator  of  the  registry  no  more  than  three  months  prior  to  the  date  any 
 call  is  made,  and  maintains  records  documenting  this  process;  and  (v)  any  subsequent  call  otherwise  violating  the  do-  not-  call  rules  is  the  result  of  error.  143  We  acknowledge  that  the  three-month 
 safe  harbor  period  for  telemarketers  may  prove  to  be  too  long  to  benefit  some  consumers.  The  national  do-  not-  call  list  has  the  capability  to  process  new  registrants  virtually 
 instantaneously  and  telemarketers  will  have  the  capability  to  download  the  list  at  any  time  at  no  extra  cost.  The  Commission  intends  to  carefully  monitor  the  impact  of  this  requirement  pursuant 
 to  its  annual  report  to  Congress  and  may  consider  a  shorter  time  frame  in  the  future. 
 39.  As  required  by  section  227(  c)(  1)(  A),  we  have  compared  and  evaluated  the  advantages  and  disadvantages  of  certain  alternative  methods  to  protect  consumer  privacy 


 including  the  use  of  network  technologies,  special  directory  markings,  and  company-  specific  lists  in  adopting  a  national  do-  not-  call  database.  144  As  noted  below,  the  effectiveness  of  the 
 company-  specific  approach  has  significantly  eroded  as  a  result  of  hang-  up  and  dead  air  calls  from  predictive  dialers.  Consumers  in  these  circumstances  have  no  opportunity  to  assert  their 
 do-  not-  call  rights.  As  discussed  more  fully  below,  we  believe  that,  as  a  stand-  alone  option,  the  company-  specific  approach  no  longer  provides  consumers  with  sufficient  privacy  protections. 
 We  also  conclude  that  the  availability  of  certain  network  technologies  to  reduce  telephone 


 142  See  FTC  Order,  68  Fed.  Reg.  at  4645-  46. 
 143  See  16  C.  F.  R.    310.4(  b)(  3). 
 144  See  47  U.  S.  C.    227(  c)(  1)(  A). 
27

 Federal  Communications  Commission  FCC  03-  153 
 28 
 solicitations  is  often  ineffective  and  costly  for  consumers.  Although  technology  has  improved  to  assist  consumers  in  blocking  unwanted  calls,  it  has  also  evolved  in  such  a  way  as  to  assist 
 telemarketers  in  making  greater  numbers  of  calls  and  even  circumventing  such  blocking  technologies.  145  Millions  of  consumers  continue  to  register  on  state  do-  not-  call  lists  despite  the 
 availability  of  such  technologies.  Several  commenters  note  that  they  continue  to  receive  unwanted  calls  despite  paying  for  technologies  to  reduce  telephone  solicitations.  146  Several 
 commenters  also  note  that  telemarketers  routinely  block  transmission  of  caller  ID.  In  particular,  we  are  concerned  that  the  cost  of  technologies  such  as  caller  ID,  call  blocking,  and  other  such 
 tools  in  an  effort  to  reduce  telemarketing  calls  fall  entirely  on  the  consumer.  We  believe  that  reliance  on  a  solution  that  places  the  cost  of  reducing  the  number  of  unwanted  solicitation  calls 
 entirely  on  the  consumer  is  inconsistent  with  Congress  intent  in  the  TCPA.  147  For  the  reasons  outlined  in  the  1992  TCPA  Order,  we  also  decline  to  adopt  special  area  codes  or  prefixes  for 
 telemarketers.  148  We  believe  this  option  is  costly  for  telemarketers  that  would  be  required  to  change  their  telephone  numbers  and  administratively  burdensome  to  implement.  We  also 
 decline  to  adopt  special  directory  markings  of  area  white  page  directories  because  it  would  require  telemarketers  to  purchase  and  review  thousands  of  local  telephone  directories,  at  great 
 cost  to  the  telemarketers.  149  We  also  note  that  telemarketers  often  compile  solicitation  lists  from  many  sources  other  than  local  telephone  directories.  In  addition,  such  directories  do  not  include 
 unlisted  or  unregistered  telephone  numbers  and  are  often  updated  infrequently.  We  also  note  that  the  record  in  this  proceeding  provides  little  support  for  this  option. 


 40.  We  now  review  the  other  requirements  of  section  227(  c)(  1).  As  required  by  section  227(  c)(  1)(  B),  we  have  evaluated  AT&  T  Government  Solutions,  the  entity  selected  by  the 
 FTC  to  administer  the  national  database,  and  conclude  that  it  has  the  capacity  to  establish  and  administer  the  national  database.  150  Congress  has  reviewed  and  approved  funding  for  the 
 implementation  of  that  database.  We  believe  that  it  is  unnecessary  to  evaluate  any  other  such  entities  at  this  time.  As  discussed  in  greater  detail  below,  we  have  considered  whether  different 
 methods  and  procedures  should  apply  for  local  telephone  solicitations  and  small  businesses  as  required  by  section  227(  c)(  1)(  C).  151  For  the  reasons  outlined  below,  we  conclude  that  the 


 145  See  New  telemarketer  tool  trumps  TeleZapper,  CNN.  com  (February  26,  2003) 
 <http://  edition.  cnn.  com/  2003/  TECH/  ptech/  02/  26/  telemarket.  tool.  ap/>  (noting  development  of  software  that  allows  telemarketers  to  circumvent  the  telezapper  and  other  blocking  devices). 


 146  See,  e.  g.,  Leslie  Price  Comments  (telezapper  ineffective);  Josephine  Presley  Comments  (call  blocking 
 ineffective). 
 147  For  example,  section  227(  c)  prohibits  consumers  from  being  charged  to  place  their  number  on  a  national  do-not- 
 call  list.  See  47  U.  S.  C.    227(  c)(  3)(  E). 
 148  See  1992  TCPA  Order,  7  FCC  Rcd  at  8761-  62,  paras.  16-  17. 


 149  See  47  U.  S.  C.    227(  c)(  4)(  C)  (requiring  the  Commission  to  consider  whether  the  needs  of  telemarketers 
 operating  on  a  local  basis  could  be  met  through  special  markings  of  area  white  page  directories).  This  conclusion  is  consistent  with  the  Commissions  conclusion  in  1992. 


 150  See  Letter  from  Michael  Del  Casino,  AT&  T,  to  Marlene  Dortch,  FCC,  dated  March  18,  2003. 
 151  See  infra  para.  54. 
28

 Federal  Communications  Commission  FCC  03-  153 
 29 
 national  do-  not-  call  database  takes  into  consideration  the  costs  of  those  conducting  telemarketing  on  a  local  or  regional  basis,  including  many  small  businesses.  In  particular,  we  note  that  the 
 national  do-  not-  call  database  will  permit  access  to  five  or  fewer  area  codes  at  no  cost  to  the  seller.  Pursuant  to  section  227(  c)(  1)(  D),  we  have  considered  whether  there  is  a  need  for 
 additional  authority  to  further  restrict  telephone  solicitations.  We  conclude  that  no  such  authority  is  required  at  this  time.  152  Pursuant  to  the  Do-  Not-  Call  Act,  the  Commission  must 
 report  to  Congress  on  an  annual  basis  the  effectiveness  of  the  do-  not-  call  registry.  Should  the  Commission  determine  that  additional  authority  is  required  over  telephone  solicitations  as  part  of 
 that  analysis;  the  Commission  will  propose  specific  restrictions  pursuant  to  that  report.  As  required  by  section  227(  c)(  1)(  E),  we  have  developed  regulations  to  implement  the  national  do-not- 
 call  database  in  the  most  effective  and  efficient  manner  to  protect  consumer  privacy  needs  while  balancing  legitimate  telemarketing  interests. 


 41.  As  noted  above,  the  FTCs  decision  to  adopt  a  national  do-  not-  call  list  is  currently  under  review  in  federal  district  court.  153  Because  Congress  has  approved  funding  for  the 
 administration  of  the  national  list  only  for  the  FTC,  this  Commission  would  be  forced  to  stay  implementation  of  any  national  list  should  the  plaintiffs  prevail  in  one  of  those  proceedings. 


 2.  Exemptions 
 42.  Established  Business  Relationship.  We  agree  with  the  majority  of  industry  commenters  that  an  exemption  to  the  national  do-  not-  call  list  should  be  created  for  calls  to 


 consumers  with  whom  the  seller  has  an  established  business  relationship.  154  We  note  that  section  227(  a)(  3)  excludes  from  the  definition  of  telephone  solicitation  calls  made  to  any  person  with 
 whom  the  caller  has  an  established  business  relationship.  155  We  believe  the  ability  of  sellers  to  contact  existing  customers  is  an  important  aspect  of  their  business  plan  and  often  provides 
 consumers  with  valuable  information  regarding  products  or  services  that  they  may  have  purchased  from  the  company.  For  example,  magazines  and  newspapers  may  want  to  contact 
 customers  whose  subscriptions  have  or  soon  will  expire  and  offer  new  subscriptions.  This  conclusion  is  consistent  with  that  of  the  FTC  and  the  majority  of  states  that  have  adopted  do-  not-call 
 requirements  and  considered  this  issue.  As  discussed  in  further  detail  below,  we  revise  the  definition  of  an  established  business  relationship  so  that  it  is  limited  in  duration  to  eighteen  (18) 
 months  from  any  purchase  or  transaction  and  3  months  from  any  inquiry  or  application.  156 


 152  This  finding  is  dependent,  in  large  part,  on  conclusions  that  we  have  reached  elsewhere  in  this  order.  For 
 example,  our  conclusion  that  the  McCarran-  Ferguson  Act  does  not  necessarily  prohibit  the  application  of  the  national  registry  to  insurance  companies;  rather,  the  implications  of  the  McCarran-  Ferguson  Act  will  need  to  be 


 evaluated  on  a  case-  by-  case  basis.  The  Commission  may  seek  further  clarification  or  authority  from  Congress  as  necessary  to  support  these  conclusions. 


 153  See  supra  note  39. 
 154  See,  e.  g.,  NCTA  Comments  at  6;  NAA  Comments  at  14;  MBA  Further  Comments  at  4. 
 155  47  U.  S.  C.    227(  a)(  3). 
 156  See  amended  47  C.  F.  R.    64.1200(  f)(  3). 
29

 Federal  Communications  Commission  FCC  03-  153 
 30 
 43.  To  the  extent  that  some  consumers  oppose  this  exemption,  we  find  that  once  a  consumer  has  asked  to  be  placed  on  the  sellers  company-  specific  do-  not-  call  list,  the  seller  may 
 not  call  the  consumer  again  regardless  of  whether  the  consumer  continues  to  do  business  with  the  seller.  We  believe  this  determination  constitutes  a  reasonable  balance  between  the  interests 
 of  consumers  that  may  object  to  such  calls  with  the  interests  of  sellers  in  contacting  their  customers.  This  conclusion  is  also  consistent  with  that  of  the  FTC. 


 44.  Prior  Express  Permission.  In  addition  to  the  established  business  relationship  exemption,  we  conclude  that  sellers  may  contact  consumers  registered  on  a  national  do-  not-  call 
 list  if  they  have  obtained  the  prior  express  permission  of  those  consumers.  We  note  that  section  227(  a)(  3)  excludes  from  the  definition  of  telephone  solicitation  calls  to  any  person  with  that 
 persons  prior  express  invitation  or  permission.  157  Consistent  with  the  FTCs  determination,  we  conclude  that  for  purposes  of  the  national  do-  not-  call  list  such  express  permission  must  be 
 evidenced  only  by  a  signed,  written  agreement  between  the  consumer  and  the  seller  which  states  that  the  consumer  agrees  to  be  contacted  by  this  seller,  including  the  telephone  number  to  which 
 the  calls  may  be  placed.  158  Consumers  registered  on  the  national  list  may  wish  to  have  the  option  to  be  contacted  by  particular  entities.  Therefore,  we  conclude  that  sellers  may  obtain  the  express 
 written  agreement  to  call  such  consumers.  The  express  agreement  between  the  parties  shall  remain  in  effect  as  long  as  the  consumer  has  not  asked  to  be  placed  on  the  sellers  company-specific 
 do-  not-  call  list.  If  the  consumer  subsequently  requests  not  to  be  called,  the  seller  must  cease  calling  the  consumer  regardless  of  whether  the  consumer  continues  to  do  business  with  the 
 seller.  We  also  note  that  telemarketers  may  not  call  consumers  on  the  national  do-  not-  call  list  to  request  their  written  permission  to  be  called  unless  they  fall  within  some  other  exemption.  We 
 believe  that  to  allow  such  calls  would  circumvent  the  purpose  of  this  exemption.  Prior  express  permission  must  be  obtained  by  some  other  means  such  as  direct  mailing. 


 45.  Tax-  Exempt  Nonprofit  Organizations.  We  agree  with  those  commenters  that  contend  that  the  national  do-  not-  call  requirements  should  not  be  extended  to  tax-  exempt 
 nonprofit  organizations  or  calls  made  by  independent  telemarketers  on  behalf  of  tax-  exempt  nonprofit  organizations.  159  We  note  that  section  227(  a)(  3)  specifically  excludes  calls  made  by 
 tax-  exempt  nonprofit  organizations  from  the  definition  of  telephone  solicitation.  160  In  so  doing,  we  believe  Congress  clearly  intended  to  exclude  tax-  exempt  nonprofit  organizations  from 
 prohibitions  on  telephone  solicitations  under  the  TCPA.  The  legislative  history  indicates  that 


 157  47  U.  S.  C.    227(  a)(  3).  See  also  H.  R.  REP.  NO.  102-  317  at  13  (1991)  (suggesting  that  Congress  did  not  believe 
 such  prior  express  permission  need  be  in  writing)  We  believe  that  in  discussing  the  form  in  which  prior  express  permission  must  be  given,  Congress  was  addressing  an  exemption  to  the  definition  of  telephone  solicitation. 


 Here,  we  are  addressing  the  type  of  prior  express  permission  that  would  allow  calls  to  consumers  who  already  have  indicated  that  they  do  not  wish  to  receive  telemarketing  calls  (by  registering  on  the  do-  not-  call  list). 


 158  For  purposes  of  this  exemption,  the  term  signed  shall  include  an  electronic  or  digital  form  of  signature,  to  the 
 extent  that  such  form  of  signature  is  recognized  as  a  valid  signature  under  applicable  federal  or  state  contract  law. 
 159  See,  e.  g.,  Association  of  Fundraising  Professionals  Comments  at  3-  4;  Fund  for  Public  Interest  Comments  at  2; 
 March  of  Dimes  Comments  at  2;  Special  Olympics  of  Hawaii  Comments. 
 160  47  U.  S.  C.    227(  a)(  3). 
30

 Federal  Communications  Commission  FCC  03-  153 
 31 
 commercial  calls  constitute  the  bulk  of  all  telemarketing  calls.  161  A  number  of  commenters  and  the  FTC  agree  with  Congress  conclusion  as  it  relates  to  a  national  do-  not-  call  list.  162  For  this 
 reason,  we  decline  to  extend  the  national  do-  not-  call  requirements  to  tax-  exempt  nonprofit  organizations.  A  few  commenters  seek  clarification  that  requests  for  blood  donations  will  be 
 exempt  from  the  national  do-  not-  call  list.  163  When  such  requests  are  made  by  tax-  exempt  nonprofit  organizations,  they  will  fall  within  the  exemption  for  tax-  exempt  nonprofit 
 organizations. 
 46.  Others.  We  decline  to  create  specific  exemptions  to  the  national  do-  not-  call  requirements  for  entities  such  as  newspapers,  magazines,  regional  telemarketers,  or  small 


 businesses.  164  For  the  reasons  discussed  above,  we  find  unpersuasive  arguments  that  application  of  the  national  do-  not-  call  database  adopted  herein  will  result  in  severe  economic  consequences 
 for  these  entities.  In  particular,  we  note  the  exemptions  adopted  for  calls  made  to  consumers  with  whom  the  seller  has  an  established  business  relationship  and  those  that  have  provided 
 express  agreement  to  be  called.  As  noted,  many  consumers  may  also  determine  not  to  register  on  the  national  database.  Telemarketers  may  continue  to  contact  all  of  these  consumers.  We 
 believe  these  exemptions  provide  telemarketers  with  a  reasonable  opportunity  to  conduct  their  business  while  balancing  consumer  privacy  interests.  Although  we  agree  that  newspapers  and 
 other  entities  may  often  provide  useful  information  and  services  to  the  public,  given  our  conclusion  that  adoption  of  the  national  do-  not-  call  list  will  not  unduly  interfere  with  the  ability 
 of  telemarketers  to  reach  consumers,  we  do  not  find  this  to  be  a  compelling  basis  to  exempt  these  entities. 


 47.  We  find  that  the  national  do-  not-  call  rules  adopted  today  do  not  apply  to  calls  made  to  persons  with  whom  the  marketer  has  a  personal  relationship.  As  discussed  herein,  a 
 personal  relationship  refers  to  an  individual  personally  known  to  the  telemarketer  making  the  call.  In  such  cases,  we  believe  that  calls  to  family  members,  friends  and  acquaintances  of  the 
 caller  will  be  both  expected  by  the  recipient  and  limited  in  number.  165  Therefore,  the  two  most 


 161  See  H.  R.  REP.  NO.  102-  317  at  16  (1991). 
 162  See,  e.  g.,  Fund  for  Public  Interest  Comments  at  2;  March  of  Dimes  Comments  at  2;  Non-  for-  Profit  Coalition 
 Comments  at  11-  13;  Special  Olympics  Hawaii  Comments.  But  see  Wayne  G.  Strang  Comments  at  7-  8;  Michael  C.  Worsham  Comments  at  10.  Commenters  also  argue  that  restrictions  imposed  on  tax-  exempt  nonprofit 


 organizations  or  organizations  acting  on  their  behalf  are  subject  to  more  stringent  scrutiny  under  the  First  Amendment  as  noncommercial  speech.  See  NPCC  Comments  at  15-  18. 


 163  See,  e.  g.,  American  Red  Cross  Comments  at  2;  Americas  Blood  Centers  Comments  at  1. 
 164  See,  e.  g.,  Newspaper  Association  of  America  Comments  at  12-  14  (noting  that  newspapers  are  holders  of 
 second-  class  mail  permits);  Personal  Legal  Plans  Comments  at  5  (contending  that  small  businesses  should  be  exempt);  Seattle  Times  Comments  at  2  (proposing  exemption  for  newspapers);  Vector  Comments  at  7  (proposing 


 exemption  for  entities  that  make  a  de  minimis  number  of  calls);  Ameriquest  Further  Comments  at  2  (  face-  to-  face  exemption). 


 165  In  determining  whether  a  telemarketer  is  considered  a  'friend'  or  'acquaintance'  of  a  consumer,  we  will  look  at, 
 among  other  things,  whether  a  reasonable  consumer  would  expect  calls  from  such  a  person  because  they  have  a  close  or,  at  least,  firsthand  relationship.  If  a  complaining  consumer  were  to  indicate  that  a  relationship  is  not 


 sufficiently  personal  for  the  consumer  to  have  expected  a  call  from  the  marketer,  we  would  be  much  less  likely  to  (continued.) 
31

 Federal  Communications  Commission  FCC  03-  153 
 32 
 common  sources  of  consumer  frustration  associated  with  telephone  solicitations    high  volume  and  unexpected  solicitations    are  not  likely  present  when  such  calls  are  limited  to  persons  with 
 whom  the  marketer  has  a  personal  relationship.  166  Accordingly,  we  find  that  these  calls  do  not  represent  the  type  of  telephone  solicitations  to  which  [telephone  subscribers]  object  discussed 
 in  section  227(  c)(  1).  Moreover,  we  conclude  that  the  Commission  also  has  authority  to  recognize  this  limited  carve-  out  pursuant  to  section  227(  c)(  1)(  E).  This  subsection  provides  the 
 Commission  with  discretion  in  implementing  rules  to  protect  consumer  privacy  to  develop  proposed  regulations  to  implement  the  methods  and  procedures  that  the  Commission  determines 
 are  the  most  effective  and  efficient  to  accomplish  the  purpose  of  this  section.  167  To  the  extent  that  any  consumer  objects  to  such  calls,  the  consumer  may  request  to  be  placed  on  the 
 telemarketers  companys  company-  specific  do-  not-  call  list.  We  intend  to  monitor  the  rules  we  adopt  today  and  caution  that  any  individual  or  entity  relying  on  personal  relationships  abusing 
 this  exemption  may  be  subject  to  enforcement  action. 
 48.  In  addition,  we  decline  to  extend  this  approach  beyond  persons  that  have  a  personal  relationship  with  the  marketer.  For  example,  Vector  urges  the  Commission  to  adopt  an 


 exemption  that  covers  face-  to-  face  appointment  calls  to  anyone  known  personally  to  the  referring  source.  168  We  note  that  such  relationships  become  increasingly  tenuous  as  they 
 extend  to  individuals  not  personally  known  to  the  marketer  and  thus  such  calls  are  more  likely  to  be  unexpected  to  the  recipient  and  more  voluminous.  Accordingly,  referrals  to  persons  that  do 
 not  have  a  personal  relationship  with  the  marketer  will  not  fall  within  the  category  of  calls  discussed  above. 


 49.  We  also  decline  to  establish  an  exemption  for  calls  made  to  set  face-  to-  face  appointments  per  se.  169  We  conclude  that  such  calls  are  made  for  the  purpose  of  encouraging  the 
 purchase  of  goods  and  services  and  therefore  fall  within  the  statutory  definition  of  telephone  solicitation.  We  find  no  reason  to  conclude  that  such  calls  are  somehow  less  intrusive  to 
 consumers  than  other  commercial  telephone  solicitations.  The  FTC  has  reviewed  this  issue  and  reached  the  same  conclusion.  170  In  addition,  we  decline  to  exempt  entities  that  make  a  de 


 (Continued  from  previous  page)  find  that  the  personal  relationship  exemption  is  applicable.  While  we  do  not  adopt  a  specific  cap  on  the  number  of 
 calls  that  a  marketer  may  make  under  this  exemption,  we  underscore  that  the  limited  nature  of  the  exemption  creates  a  strong  presumption  against  those  marketers  who  make  more  than  a  limited  number  of  calls  per  day. 


 166  We  note  that  this  conclusion  is  consistent  with  Congress  rationale  in  exempting  tax-  exempt  nonprofit 
 organizations  and  established  business  relationships  from  the  definition  of  telephone  solicitation.  See  H.  R.  Rep.  No.  102-  317  at  14  and  16  (1991). 


 167  47  U.  S.  C    227(  c)(  1)(  E). 
 168  See  Vector  Further  Comments  at  Att.  2.  Vector  makes  approximately  4  million  calls  per  year.  Vector 
 Comments  at  6. 
 169  See,  e.  g.,  Ameriquest  Comments  at  14;  Vector  Comments  at  6-  7.  Such  calls  may,  however,  be  permissible 
 when  they  fall  within  exemptions  for  personal  or  established  business  relationships  as  discussed  herein. 
 170  FTC  Order,  68  Fed.  Reg.  4655-  56. 
32

 Federal  Communications  Commission  FCC  03-  153 
 33 
 minimis  number  of  commercial  telemarketing  calls.  171  In  contrast  to  Congress  rationale  for  exempting  nonprofit  organizations,  we  believe  that  such  commercial  calls  continue  to  be 
 unexpected  to  consumers  even  if  made  in  low  numbers.  As  defined  by  one  commenter,  a  de  minimis  number  of  calls  would  not  be  based  on  the  total  number  of  calls  originating  from  one 
 organization,  but  would  be  based  on  the  number  of  calls  placed  by  individual  employees  of  the  company.  172  Thus,  the  telemarketing  entity  could  circumvent  the  do-  not-  call  regulations  by 
 hiring  any  number  of  individual  marketers,  so  long  as  they  each  did  not  make  more  than  20  calls  per  day.  We  believe  that  such  an  exemption,  extrapolated  to  the  entire  direct  marketing  industry, 
 would  result  in  a  significant  number  of  unwanted  telephone  solicitations.  This  would  undoubtedly  result  in  consumer  confusion  and  frustration  regarding  the  application  of  the 
 national  do-  not-  call  rules.  In  addition,  we  believe  that  it  would  be  difficult,  if  not  impossible,  to  monitor  and  enforce  such  a  requirement.  For  the  reasons  discussed  below,  we  do  not  believe  the 
 costs  to  access  the  national  database  is  unreasonable  for  any  small  business  or  entity  making  a  de  minimis  number  of  calls. 


 50.  In  response  to  the  Further  Notice,  a  few  commenters  contend  that  any  new  rules  the  Commission  adopts  would  not  apply  to  entities  engaged  in  the  business  of  insurance,  because 
 such  rules  would  conflict  with  the  McCarran-  Ferguson  Act.  173  The  McCarran-  Ferguson  Act  provides  that  [  t]  he  business  of  insurance  ...  shall  be  subject  to  the  laws  of  the  ...  States  which 
 relate  to  the  regulation  ...  of  such  business.  174  The  McCarran-  Ferguson  Act  further  provides  that  [  n]  o  Act  of  Congress  shall  be  construed  to  invalidate,  impair,  or  supersede  any  law  enacted  by 
 any  State  for  the  purpose  of  regulating  the  business  of  insurance  ...  unless  such  Act  specifically  relates  to  the  business  of  insurance.  175  American  Council  of  Life  Insurers  (ACLI)  explains  that 
 insurers  marketing  activities  are  extensively  regulated  at  the  state  level.  The  Commissions  proposal,  ACLI  argues,  intrudes  upon  the  insurance  regulatory  framework  established  by  the 
 states  and,  therefore,  should  not  be  applicable  to  insurers  under  McCarran-  Ferguson.  176 
 51.  The  McCarran-  Ferguson  Act  does  not  operate  to  exempt  insurance  companies  wholesale  from  liability  under  the  TCPA.  It  applies  only  when  their  activities  constitute  the 


 business  of  insurance,  the  state  has  enacted  laws  for  the  purpose  of  regulating  the  business  of  insurance,  and  the  TCPA  would  impair,  invalidate,  or  supersede  such  state  laws.  177  In  the 


 171  For  example,  Vector  suggests  that  the  Commission  exempt  individual  direct  sellers  who  make  no  more  than  20 
 calls  per  day.  Vector  Comments  at  8-  10. 
 172  Vector  Further  Comments  at  4.  Vector  makes  approximately  4  million  calls  per  year.  Vector  Comments  at  6. 


 173  See  ACLI  Further  Comments  at  1-  3;  Stonebridge  Further  Comments  at  5-  7;  Cendant  Further  Comments  at  3-  4; 
 NAII  Further  Comments  at  3.  We  note  that  many  other  commenters  representing  insurance  interests  did  not  raise  this  issue  before  or  during  the  Further  Notice  comment  period. 


 174  15  U.  S.  C.    1012(  a). 
 175  15  U.  S.  C.    1012(  b). 
 176  See  ACLI  Further  Comments  at  1-  2. 
 177  See  15  U.  S.  C.    1012(  b);  see  also  The  Chair  King,  Inc.  v.  Houston  Cellular  Corp.,  1995  WL  1760037  (S.  D. 
 Tex.  1995),  vacated  for  lack  of  subject  matter  jurisdiction  131  F.  3d  507  (5th  Cir.  1997). 
33

 Federal  Communications  Commission  FCC  03-  153 
 34 
 one  case  cited  by  commenters  as  addressing  the  interplay  between  McCarran-  Ferguson  and  the  TCPA,  a  federal  district  court  dismissed  a  claim  brought  against  two  insurance  companies  under 
 the  TCPA  for  sending  unsolicited  facsimile  advertisements.  178  The  Chair  King  court  found  that  the  TCPA  conflicted  with  a  Texas  law  that  prohibited  untrue,  deceptive,  or  misleading 
 advertising  by  insurers  and  their  agents.  In  its  analysis,  the  court  determined  that  insurance  advertising  was  part  of  the  business  of  insurance,  179  and  that  the  Texas  law  in  question  was 
 enacted  for  the  purpose  of  regulating  the  business  of  insurance.  180  The  court  then  concluded  that  because  the  TCPA  prohibits  unsolicited  insurance  advertising  by  facsimile  while  the  Texas 
 [laws]  permit  [such]  advertising  .  .  .  so  long  as  the  advertisements  are  truthful  and  not  misleading,  the  TCPA  conflicts  with  the  Texas  law  and  is  preempted  under  McCarran-Ferguson. 
 181 


 52.  To  the  extent  that  any  state  law  regulates  the  business  of  insurance  182  and  the  TCPA  is  found  to  invalidate,  impair,  or  supersede  such  state  law,  it  is  possible  that  a  particular 
 activity  involving  the  business  of  insurance  would  not  fall  within  the  reach  of  the  TCPA.  Any  determination  about  the  applicability  of  McCarran-  Ferguson,  however,  requires  an  analysis  of 
 the  particular  activity  and  State  law  regulating  it.  In  addition,  McCarran-  Ferguson  applies  only  to  federal  statutes  that  invalidate,  impair,  or  supersede  state  insurance  regulation.  Courts  have 
 held  that  duplication  of  state  law  prohibitions  by  a  federal  statute  do  not  invalidate,  impair,  or  supersede  state  laws  regulating  the  business  of  insurance.  183  Nor  is  the  mere  presence  of  a 
 regulatory  scheme  enough  to  show  that  a  state  statute  is  invalidated,  impaired  or  superseded.  184 
 53.  We  believe  that  the  TCPA,  which  was  enacted  to  protect  consumer  privacy  interests,  is  compatible  with  states  regulatory  interests.  185  In  fact,  the  TCPA  permits  States  to 


 178  The  Chair  King,  Inc.  v.  Houston  Cellular  Corp.,  1995  WL  1760037  (S.  D.  Tex.  1995). 
 179  See  Chair  King,  1995  WL  1760037  at  3  (citing  SEC  v.  National  Securities  Inc.,  393  U.  S.  453,  460  (1960)  and 
 FTC  v.  National  Casualty  Co.,  357  U.  S.  560  (1958)). 
 180  See  Chair  King,  1995  WL  1760037  at  4. 


 181  We  note  that  the  TCPAs  prohibition  does  not  specifically  reference  insurance  advertising.  The  TCPA  also 
 permits  facsimile  advertising  to  persons  who  have  given  their  prior  express  invitation  or  permission.  See  47  U.  S.  C.    227(  b)(  1)(  C)  and  (a)(  4). 


 182  NAII  explains  that  [  s]  tate  insurance  codes  prohibit  a  variety  of  unfair  trade  practices,  such  as  rebating, 
 deceptive  advertising,  inequitable  claim  settlement  and  unfair  discrimination.  See  NAII  Further  Comments  at  2. 
 183  See,  e.  g.,  Merchant  Home  Delivery  Serv.  Inc.  v.  Frank  B.  Hall  &  Co.  Inc.,  50  F.  3d  1486,  1492  (9th  Cir.  1995) 
 (holding  federal  statute  prohibiting  acts  also  prohibited  under  state  law  not  to  invalidate,  impair,  or  supersede  state  law  under  McCarran-  Ferguson);  United  Farm  Bureau  Mut.  Ins.  Co.  v.  Metropolitan  Human  Relations 


 Commn,  24  F.  3d  1008,  1016  (7th  Cir.  1994)  (holding  duplicate  prohibition  of  redlining  under  Indiana  law  not  to  preempt  Fair  Housing  Act  under  McCarran-  Ferguson  Act). 


 184  See,  e.  g.,  Mackey  v.  Nationwide  Ins.  Companies,  724  F.  2d  419,  421  (4th  Cir.  1984). 
 185  See  U.  S.  v.  Calvin,  39  F.  3d  1299,  1305  (5th  Cir.  1994)  (noting  that  government  charges  of  fraud  not  barred  by 
 McCarran-  Ferguson  Act  where  interest  in  fraud  protection  is  completely  compatible  with  state's  regulatory  interests). 
34

 Federal  Communications  Commission  FCC  03-  153 
 35 
 enforce  the  provisions  of  the  TCPA  on  behalf  of  residents  of  their  State.  186  In  addition,  we  believe  that  uniform  application  of  the  national  do-  not-  call  registry  to  all  entities  that  use  the 
 telephone  to  advertise  best  serves  the  goals  of  the  TCPA.  To  exempt  the  insurance  industry  from  liability  under  the  TCPA  would  likely  confuse  consumers  and  interfere  with  the  protections 
 provided  by  Congress  through  the  TCPA.  Therefore,  to  the  extent  that  the  operation  of  McCarran-  Ferguson  on  the  TCPA  is  unclear,  we  will  raise  this  issue  in  our  Report  to  Congress 
 as  required  by  the  Do-  Not-  Call  Act. 
 54.  We  conclude  that  the  national  do-  not-  call  mechanism  established  by  the  FTC  and  this  Commission  adequately  takes  into  consideration  the  needs  of  small  businesses  and  entities 


 that  telemarket  on  a  local  or  regional  basis  in  gaining  access  to  the  national  database.  As  required  by  section  227(  c)(  1)(  C),  we  have  considered  whether  different  procedures  should  apply 
 for  local  solicitations  and  small  businesses.  We  decline,  however,  to  exempt  such  entities  from  the  national  do-  not-  call  requirements.  Given  the  large  number  of  entities  that  solicit  by 
 telephone,  and  the  technological  tools  that  allow  even  small  entities  to  make  a  significant  number  of  solicitation  calls,  we  believe  that  to  do  so  would  undermine  the  effectiveness  of  the 
 national  do-  not-  rules  in  protecting  consumer  privacy  and  create  consumer  confusion  and  frustration.  In  so  doing,  we  conclude  that  the  approach  adopted  herein  satisfies  section 
 227(  c)(  4)  s  requirement  that  the  Commission,  in  developing  procedures  for  gaining  access  to  the  database,  consider  the  different  needs  of  telemarketers  conducting  business  on  a  national, 
 regional,  State,  or  local  level  and  develop  a  fee  schedule  for  recouping  the  cost  of  such  database  that  recognizes  such  differences.  187  The  national  database  will  be  available  for  purchase  by 
 sellers  on  an  area-  code-  by-  area-  code  basis.  The  cost  to  access  the  database  will  vary  depending  on  the  number  of  area  codes  requested.  Sellers  need  only  purchase  those  area  codes  in  which  the 
 seller  intends  to  telemarket.  In  fact,  sellers  that  request  access  to  five  or  fewer  area  codes  will  be  granted  access  to  those  area  codes  at  no  cost.  We  note  that  thirty-  three  states  currently  have  five 
 or  fewer  area  codes.  Thus,  telemarketers  or  sellers  operating  on  a  local  or  regional  basis  within  one  of  these  thirty-  three  states  will  have  access  to  all  of  that  states  national  do-  not-  call 
 registrants  at  no  cost.  In  addition,  the  national  database  will  provide  a  single  number  lookup  feature  whereby  a  small  number  of  telephone  numbers  can  be  entered  on  a  web  page  to 
 determine  whether  any  of  those  numbers  are  included  on  the  national  registry.  We  believe  this  fee  structure  adequately  reflects  the  needs  of  regional  telemarketers,  small  business  and  those 
 marketing  on  a  de  minimis  level.  For  these  reasons,  we  conclude  that  this  approach  will  not  place  any  unreasonable  costs  on  small  businesses.  188 


 3.  Section  227(  c)(  3)  Requirements 
 55.  We  conclude  that  the  national  do-  not-  call  database  adopted  jointly  by  this  Commission  and  the  FTC  satisfies  each  of  the  statutory  requirements  outlined  in  section 


 227(  c)(  3)(  A)-(  L).  We  now  discuss  each  such  requirement.  Section  227(  c)(  3)(  A)  requires  the 


 186  See  47  U.  S.  C.    227(  f)(  1). 
 187  47  U.  S.  C.    227(  c)(  4)(  A)-(  B)  (emphasis  added). 
 188  See  47  U.  S.  C.    227(  c)(  4)(  B)(  iii). 
35

 Federal  Communications  Commission  FCC  03-  153 
 36 
 Commission  to  specify  the  method  by  which  an  entity  to  administer  the  national  database  will  be  selected.  On  August  2,  2002,  the  FTC  issued  a  Request  for  Quotes  (RFQ)  to  selected  vendors  on 
 GSA  schedules  seeking  proposals  to  develop,  implement,  and  operate  the  national  registry.  After  evaluating  those  proposals,  the  FTC  selected  a  competitive  range  of  vendors  and  issued  an 
 amended  RFQ  to  those  vendors  on  November  25,  2002.  After  further  evaluation,  the  FTC  selected  AT&  T  Government  Solutions  as  the  successful  vendor  for  the  national  do-  not-  call 
 database  on  March  1,  2003.  189  As  noted  above,  Congress  has  approved  the  necessary  funding  for  implementation  of  the  national  database. 


 56.  Pursuant  to  sections  227(  c)(  3)(  B)-(  C),  we  require  each  common  carrier  providing  telephone  exchange  service  to  inform  subscribers  for  telephone  exchange  service  of  the 
 opportunity  to  provide  notification  that  such  subscriber  objects  to  receiving  telephone  solicitations.  Each  telephone  subscriber  shall  be  informed,  by  the  common  carrier  that  provides 
 local  exchange  service  to  that  subscriber,  of  (i)  the  subscribers  right  to  give  or  revoke  a  notification  of  an  objection  to  receiving  telephone  solicitations  pursuant  to  the  national  database 
 and  (ii)  the  methods  by  which  such  rights  may  be  exercised  by  the  subscriber.  Pursuant  to  section  227(  c)(  3)(  C),  we  conclude  that,  beginning  on  January  1,  2004,  such  common  carriers 
 shall  provide  an  annual  notice,  via  an  insert  in  the  customers  bill,  to  inform  their  subscribers  of  the  opportunity  to  register  or  revoke  registrations  on  the  national  do-  not-  call  database.  Although 
 we  do  not  specify  the  exact  description  or  form  that  such  notification  should  take,  such  notification  must  be  clear  and  conspicuous.  At  a  minimum,  it  must  include  the  toll-  free 
 telephone  number  and  internet  address  established  by  the  FTC  to  register  or  revoke  registrations  on  the  national  do-  not-  call  database. 


 57.  Section  227(  c)(  3)(  D)  requires  the  Commission  to  specify  the  methods  by  which  registrations  shall  be  collected  and  added  to  the  database.  As  discussed  above,  consumers  will 
 be  able  to  add  their  telephone  numbers  to  the  national  do-  not-  call  registry  either  through  a  toll-free  telephone  call  or  over  the  Internet.  190  Consumers  who  choose  to  register  by  phone  will  have 
 to  call  the  registration  number  from  the  telephone  line  that  they  wish  to  register.  Their  calls  will  be  answered  by  an  Interactive  Voice  Response  (IVR)  system.  The  consumers  will  be  asked  to 
 enter  on  their  telephone  keypad  the  telephone  number  from  which  the  consumer  is  calling.  This  number  will  be  checked  against  the  ANI  that  is  transmitted  with  the  call.  If  the  number  entered 
 matches  the  ANI,  then  the  consumer  will  be  informed  that  the  number  has  been  registered.  Consumers  who  choose  to  register  over  the  Internet  will  go  to  a  website  dedicated  to  the 
 registration  process  where  they  will  be  asked  to  enter  the  telephone  number  they  wish  to  register.  191  We  encourage  the  FTC  to  notify  consumers  in  the  IVR  message  that  the  national 
 registry  will  prevent  most,  but  not  all,  telemarketing  calls.  Specifically,  we  believe  consumers  should  be  informed  that  the  do-  not-  call  registry  does  not  apply  to  tax-  exempt  nonprofit 
 organizations  and  companies  with  whom  consumers  have  an  established  business  relationship.  The  effectiveness  and  value  of  the  national  registry  depends  largely  on  an  informed  public. 
 Therefore,  we  also  intend  to  emphasize  in  our  educational  materials  and  on  our  website  the 
 189  See  also  Letter  from  Michael  Del  Casino,  AT&  T,  to  Marlene  Dortch,  FCC,  dated  March  18,  2003. 
 190  FTC  Order,  68  Fed.  Reg.  at  4638-  39. 
 191  FTC  Order,  68  Fed.  Reg.  at  4639. 
36

 Federal  Communications  Commission  FCC  03-  153 
 37 
 purpose  and  scope  of  the  new  rules. 
 58.  Section  227(  c)(  3)(  E)  prohibits  any  residential  subscriber  from  being  charged  for  giving  or  revoking  notification  to  be  included  on  the  national  do-  not-  call  database.  As  discussed 


 above,  consumers  may  register  or  revoke  do-  not-  call  requests  either  by  a  toll-  free  telephone  call  or  over  the  Internet.  No  charge  will  be  imposed  on  the  consumer.  Section  227(  c)(  3)(  F)  prohibits 
 any  person  from  making  or  transmitting  a  telephone  solicitation  to  the  telephone  number  of  any  subscriber  included  on  the  national  database.  Subject  to  the  exemptions  discussed  above,  we 
 adopt  rules  herein  that  will  prohibit  telephone  solicitations  to  those  consumers  that  have  registered  on  the  national  database.  192 


 59.  Section  227(  c)(  3)(  G)  requires  the  Commission  to  specify  (i)  the  methods  by  which  any  person  deciding  to  make  telephone  solicitations  will  obtain  access  to  the  database,  by 
 area  code  or  local  exchange  prefix,  and  (ii)  the  costs  to  be  recovered  from  such  persons.  Section  227(  c)(  3)(  H)  requires  the  Commission  to  specify  the  methods  for  recovering,  from  the  persons 
 accessing  the  database,  the  costs  involved  in  the  operations  of  the  database.  To  comply  with  the  national  do-  not-  call  rules,  telemarketers  must  gain  access  to  the  telephone  numbers  in  the 
 national  database.  Telemarketers  will  have  access  to  the  national  database  by  means  of  a  fully-automated,  secure  website  dedicated  to  providing  information  to  these  entities.  193  The  first  time 
 a  telemarketer  accesses  the  system,  the  company  will  be  asked  to  provide  certain  limited  identifying  information,  such  as  name  and  address,  contact  person,  and  contact  persons 
 telephone  number  and  address.  If  a  telemarketer  is  accessing  the  registry  on  behalf  of  a  client  seller,  the  telemarketer  will  also  need  to  identify  that  client.  194  When  a  telemarketer  first  submits 
 an  application  to  access  registry  information,  the  company  will  be  asked  to  specify  the  area  codes  they  want  to  access.  An  annual  fee  will  be  assessed  based  upon  the  number  of  area  codes 
 requested.  195  Each  entity  on  whose  behalf  the  telephone  solicitation  is  being  made  must  pay  this  fee  via  credit  card  or  electronic  funds  transfer.  After  payment  is  processed,  the  telemarketer  will 
 be  given  an  account  number  and  permitted  to  access  the  appropriate  portions  of  the  registry.  196  Telemarketers  will  be  permitted  to  access  the  registry  as  often  as  they  wish  for  no  additional 
 cost,  once  the  annual  fee  is  paid. 
 60.  Section  227(  c)(  3)(  I)  requires  the  Commission  to  specify  the  frequency  with  which  the  national  database  will  be  updated  and  specify  the  method  by  which  such  updates  will  take 


 effect  for  purposes  of  compliance  with  the  do-  not-  call  regulations.  Because  the  registration  process  will  be  completely  automated,  updates  will  occur  continuously.  Consumer  registrations 


 192  See  also  16  C.  F.  R.    310.4(  b)(  1)(  iii)(  B). 
 193  FTC  Order,  68  Fed.  Reg.  at  4640. 
 194  FTC  Order,  68  Fed.  Reg.  at  4640. 
 195  Telemarketing  Sales  Rule  Fees,  68  Fed.  Reg.  16238  (April  3,  2003)  (FTC  Fees  Notice).  The  FTC  has 
 proposed  that  sellers  be  charged  $29  per  area  code  with  a  maximum  annual  fee  of  $7,250  for  access  to  the  entire  national  database.  Sellers  may  request  access  to  five  or  less  areas  codes  for  free. 


 196  FTC  Order,  68  Fed.  Reg.  at  4640. 
37

 Federal  Communications  Commission  FCC  03-  153 
 38 
 will  be  added  to  the  registry  at  the  same  time  they  register  -  or  at  least  within  a  few  hours  after  they  register.  As  discussed  above,  the  safe  harbor  provision  requires  telemarketers  to  employ  a 
 version  of  the  registry  obtained  not  more  than  three  months  before  any  call  is  made.  Thus,  telemarketers  will  be  required  to  update  their  lists  at  least  quarterly.  Instead  of  making  the  list 
 available  on  specific  dates,  the  registry  will  be  available  for  downloading  on  a  constant  basis  so  that  telemarketers  can  access  the  registry  at  any  time.  197  As  a  result,  each  telemarketers  three-month 
 period  may  begin  on  different  dates.  198  In  addition,  the  administrator  will  check  all  telephone  numbers  in  the  do-  not-  call  registry  each  month  against  national  databases,  and  those 
 numbers  that  have  been  disconnected  or  reassigned  will  be  removed  from  the  registry.  199  We  encourage  parties  that  may  have  specific  recommendations  on  ways  to  improve  the  overall 
 accuracy  of  the  database  in  removing  disconnected  and  reassigned  telephone  numbers  to  submit  such  proposals  to  our  attention  and  to  the  FTC  directly. 


 61.  Section  227(  c)(  3)(  J)  requires  that  the  Commissions  regulations  be  designed  to  enable  states  to  use  the  database  for  purposes  of  administering  or  enforcing  state  law.  200  Section 
 227(  c)(  3)(  K)  prohibits  the  use  of  the  database  for  any  purpose  other  than  compliance  with  the  do-  not-  call  rules  and  any  such  state  law  and  requires  the  Commission  to  specify  methods  for 
 protection  of  the  privacy  rights  of  persons  whose  numbers  are  included  in  such  database.  Consistent  with  the  determination  of  the  FTC,  we  conclude  that  any  law  enforcement  agency  that 
 has  responsibility  to  enforce  federal  or  state  do-  not-  call  rules  or  regulations  will  be  permitted  to  access  the  appropriate  information  in  the  national  registry.  201  This  information  will  be  obtained 
 through  a  secure  Internet  website.  Such  law  enforcement  access  to  data  in  the  national  registry  is  critical  to  enable  state  Attorneys  General,  public  utility  commissions  or  an  official  or  agency 
 designated  by  a  state,  and  other  appropriate  law  enforcement  officials  to  gather  evidence  to  support  enforcement  of  the  do-  not-  call  rules  under  the  state  and  federal  law.  In  addition,  as 
 discussed  above,  we  have  imposed  restrictions  on  the  use  of  the  national  list.  202  Consistent  with  the  FTCs  determination,  we  have  concluded  that  no  person  or  entity  may  sell,  rent,  lease, 
 purchase,  or  use  the  national  do-  not-  call  database  for  any  purpose  except  compliance  with  section  227  and  any  such  state  or  federal  law  to  prevent  telephone  solicitations  to  telephone 
 numbers  on  such  list.  We  specifically  prohibit  any  entity  from  purchasing  this  list  from  any  entity  other  than  the  national  do-  not-  call  administrator  or  dispensing  the  list  to  any  entity  that  has 
 not  paid  the  required  fee  to  the  administrator.  The  only  information  that  will  be  made  available  to  telemarketers  is  the  telephone  number  of  consumers  registered  on  the  list.  Given  the 
 restrictions  imposed  on  the  use  of  the  national  database  and  the  limited  amount  of  information 
 197  FTC  Order,  68  Fed.  Reg.  at  4647. 
 198  Appropriate  state  and  federal  regulators  will  be  capable  of  verifying  when  the  telemarketer  last  accessed  the 
 list.  FTC  Order,  68  Fed.  Reg.  at  4641. 
 199  FTC  Order,  68  Fed.  Reg.  at  4640. 


 200  In  fact,  section  227(  e)(  2)  prohibits  states  from  using  any  database  that  does  not  include  the  part  of  the  national 
 database  that  relates  to  such  state.  See  47  U.  S.  C.    227(  e)(  2). 
 201  See  FTC  Order,  68  Fed.  Reg.  at  4641. 


 202  See  supra  para.  32. 
38

 Federal  Communications  Commission  FCC  03-  153 
 39 
 provided,  we  believe  that  adequate  privacy  protections  have  been  established  for  consumers. 
 62.  Section  227(  c)(  3)(  L)  requires  each  common  carrier  providing  services  to  any  person  for  the  purpose  of  making  telephone  solicitations  to  notify  such  person  of  the 


 requirements  of  the  national  do-  not-  call  rules  and  the  regulations  thereunder.  We  therefore  require  common  carriers,  beginning  January  1,  2004,  to  make  a  one-  time  notification  to  any 
 person  or  entity  making  telephone  solicitations  that  is  served  by  that  carrier  of  the  national  do-not-  call  requirements.  We  do  not  specify  the  exact  description  or  form  that  such  notification 
 should  take.  At  a  minimum,  it  must  include  a  citation  to  the  relevant  federal  do-  not-  call  rules  as  set  forth  in  47  C.  F.  R.    64.1200  and  16  C.  F.  R.  Part  310,  respectively.  Although  we  recognize 
 that  carriers  may  not  be  capable  of  identifying  every  person  or  entity  engaged  in  telephone  solicitations  served  by  that  carrier,  we  require  carriers  to  make  reasonable  efforts  to  comply  with 
 this  requirement.  We  note  that  failure  to  give  such  notice  by  the  common  carrier  to  a  telemarketer  served  by  that  carrier  will  not  excuse  the  telemarketer  from  violations  of  the 
 Commissions  rules. 
 4.  Constitutionality 
 63.  We  conclude  that  a  national  do-  not-  call  registry  is  consistent  with  the  First  Amendment.  As  discussed  in  more  detail  below,  we  believe,  like  the  FTC,  that  our  regulations 


 satisfy  the  criteria  set  forth  in  Central  Hudson  Gas  &  Elec.  v.  Pub.  Serv.  Comm.  of  N.  Y.,  in  which  the  Supreme  Court  established  the  applicable  analytical  framework  for  determining  the 
 constitutionality  of  a  regulation  of  commercial  speech.  203  Our  conclusion  is  also  consistent  with  every  Court  of  Appeals  decision  that  has  considered  First  Amendment  challenges  to  the 
 TCPA.  204 
 64.  Under  the  framework  established  in  Central  Hudson,  a  regulation  of  commercial  speech  will  be  found  compatible  with  the  First  Amendment  if  (1)  there  is  a  substantial 


 government  interest;  (2)  the  regulation  directly  advances  the  substantial  government  interest;  and  (3)  the  proposed  regulations  are  not  more  extensive  than  necessary  to  serve  that  interest.  205 


 203  Central  Hudson  Gas  &  Elec.  v.  Pub.  Serv.  Comm.  of  N.  Y.,  447  U.  S.  557  (1980).  NAAG  argues  that  Central 
 Hudson  may  not  even  be  the  appropriate  analytical  framework  to  determine  the  constitutionality  of  regulations  implementing  the  national  do-  not-  call  registry,  since  [  f]  ar  from  being  an  impermissible  regulation  of  speech,  the 


 registry  merely  works  to  prevent  a  form  of  trespass.    NAAG  Comments  at  34.  We  would  note,  however,  that  the  Supreme  Court  has  analyzed  other  measures  that  protected  residential  privacy  as  restrictions  on  commercial 
 speech.  See  Florida  Bar  v.  Went  For  It,  Inc.,  515  U.  S.  618  (1995)  (applied  Central  Hudson  analysis  to  Florida  Bar  rules  that  prohibited  lawyers  from  using  direct  mail  to  solicit  personal  injury  or  wrongful  death  clients  within 
 30  days  of  accident.)  See  also  State  of  Missouri  v.  American  Blast  Fax,  323  F.  3d  649  (8th  Cir.  2003)  (American  Blast  Fax),  pet.  for  rehearing  pending  and  Destination  Ventures  v.  Federal  Communications  Commission,  46  F.  3d 
 54  (9th  Cir.  1995)  (Destination  Ventures),  where  both  the  Eighth  and  Ninth  Circuits  applied  the  Central  Hudson  analysis  to  the  TCPA  provisions  banning  unsolicited  fax  advertising. 


 204  See  Kathryn  Moser  v.  Federal  Communications  Commission,  46  F.  3d  970  (9th  Cir.  1995)  (Moser)  cert.  denied, 
 515  U.  S.  1161  (1995)  (upholding  ban  on  prerecorded  telephone  calls);  American  Blast  Fax  (upholding  ban  on  unsolicited  fax  advertising)  and  Destination  Ventures  (upholding  ban  on  unsolicited  fax  advertising). 


 205  Central  Hudson,  447  U.  S.  at  566.  Specifically,  the  Court  found  that  [  f]  or  commercial  speech  to  come  within 
 the  First  Amendment,  it  at  least  must  concern  lawful  activity  and  not  be  misleading.  Next,  it  must  be  determined  (continued.) 
39

 Federal  Communications  Commission  FCC  03-  153 
 40 
 Under  the  first  prong,  we  find  that  there  is  a  substantial  governmental  interest  in  protecting  residential  privacy.  The  Supreme  Court  has  repeatedly  held  that  individuals  are  not  required  to 
 welcome  unwanted  speech  into  their  homes  and  that  the  government  may  protect  this  freedom.  206 


 65.  In  particular,  the  government  has  an  interest  in  upholding  the  right  of  residents  to  bar  unwanted  speech  from  their  homes.  In  Rowan  v.  United  States  Post  Office,  the  Supreme 
 Court  upheld  a  statute  that  permitted  a  person  to  require  that  a  mailer  remove  his  name  from  its  mailing  lists  and  stop  all  future  mailings  to  the  resident: 


 The  Court  has  traditionally  respected  the  right  of  a  householder  to  bar,  by  order  or  notice,  solicitors,  hawkers,  and  peddlers  from  his 
 property.  In  this  case  the  mailers  right  to  communicate  is  circumscribed  only  by  an  affirmative  act  of  the  addressee  giving 
 notice  that  he  wishes  no  further  mailings  from  that  mailer.  .  .  .  In  effect,  Congress  has  erected  a  wall    or  more  accurately  permits  a 
 citizen  to  erect  a  wall    that  no  advertiser  may  penetrate  without  his  acquiescence.  207 


 66.  Here,  the  record  supports  that  the  government  has  a  substantial  interest  in  regulating  telemarketing  calls.  In  1991,  Congress  held  numerous  hearings  on  telemarketing, 
 finding,  among  other  things,  that  [  m]  ore  than  300,000  solicitors  call  more  than  18,000,000  Americans  every  day  and  [  u]  nrestricted  telemarketing  can  be  an  intrusive  invasion  of  privacy 
 and,  when  an  emergency  or  medical  assistance  telephone  line  is  seized,  a  risk  to  public  safety.  208  Our  record,  like  the  FTCs,  demonstrates  that  telemarketing  calls  are  even  more  of  an  invasion 
 of  privacy  than  they  were  in  1991.  The  number  of  daily  calls  has  increased  five  fold  (to  an  estimated  104  million),  due  in  part  to  the  use  of  new  technologies,  such  as  predictive  dialers.  209 
 An  overwhelming  number  of  consumers  in  the  approximately  6,500  commenters  in  this  proceeding  support  the  adoption  and  implementation  of  a  national  do-  not-  call  registry.  In 
 addition  to  citing  concerns  about  the  numerous  and  ever-  increasing  number  of  calls,  they  (Continued  from  previous  page) 
 whether  the  asserted  governmental  interest  to  be  served  by  the  restriction  on  commercial  speech  is  substantial.  If  both  inquiries  yield  positive  answers,  it  must  then  be  decided  whether  the  regulation  directly  advances  the 
 governmental  interest  asserted,  and  whether  it  is  not  more  extensive  than  is  necessary  to  serve  that  interest.  Id.  at  557. 


 206  Frisby  v.  Schultz,  487  U.  S.  474,  485.  See  also  Federal  Communications  Commission  v.  Pacifica  Foundation, 
 438  U.  S.  726,  748  (1978)  ([  I]  n  the  privacy  of  the  home,    the  individuals  right  to  be  left  alone  plainly  outweighs  the  First  Amendment  rights  of  an  intruder.). 


 207  Rowan  v.  United  States  Post  Office,  397  U.  S.  728  at  737-  738  (1970);  see  also  Martin  v.  City  of  Struthers,  319 
 U.  S.  141  (1943),  in  which  the  Court  struck  down  a  ban  on  door-  to-  door  solicitation  because  it  substituted  the  judgment  of  the  community  for  the  judgment  of  the  individual  householder,  id.  at  144,  but  noted  in  dicta  that  a 


 regulation  which  would  make  it  an  offense  for  any  person  to  ring  a  bell  of  a  householder  who  has  appropriately  indicated  that  he  is  unwilling  to  be  disturbed  would  be  constitutional.  Id.  at  148. 


 208  H.  R.  REP.  NO.  102-  317  at  2  (1991). 
 209  See  supra  para.  8. 
40

 Federal  Communications  Commission  FCC  03-  153 
 41 
 complain  about  the  inadequacies  of  the  company-  specific  approach,  the  burdens  of  such  calls  on  the  elderly  and  people  with  disabilities,  and  the  costs  of  acquiring  technologies  to  reduce  the 
 number  of  unwanted  calls.  210  Accordingly,  we  believe  that  the  record  demonstrates  that  telemarketing  calls  are  a  substantial  invasion  of  residential  privacy,  and  regulations  that  address 
 this  problem  serve  a  substantial  government  interest. 
 67.  Under  Central  Hudsons  second  prong,  we  find  that  the  Commissions  regulations  directly  advance  the  substantial  government  interest.  Under  this  prong,  the  government  must 


 demonstrate  that  the  harms  it  recites  are  real  and  that  its  restriction  will  in  fact  alleviate  them  to  a  material  degree.  211  It  may  justify  the  restrictions  on  speech  based  solely  on  history, 
 consensus,  and  simple  common  sense.    212  Creating  and  implementing  a  national  do-  not-  call  registry  will  directly  advance  the  governments  interest  in  protecting  residential  privacy  from 
 unwanted  telephone  solicitations.  Congress,  consumers,  state  governments  and  the  FTC  have  reached  the  same  conclusion.  The  history  of  state  administered  do-  not-  call  lists  demonstrates 
 that  such  do-  not-  call  programs  have  a  positive  impact  on  the  ability  of  many  consumers  to  protect  their  privacy  by  reducing  the  number  of  unwanted  telephone  solicitations  that  they 
 receive  each  day.  213  As  noted  above,  Congress  has  reviewed  the  FTCs  decision  to  establish  a  national  do-  not-  call  list  and  concluded  that  the  do-  not-  call  initiative  will  provide  significant 
 benefits  to  consumers  throughout  the  United  States.  214  We  reject  the  arguments  that  because  our  do-  not-  call  registry  provisions  do  not  apply  to  tax-  exempt  nonprofit  organizations,  our 
 regulations  do  not  directly  and  materially  advance  the  government  interest  of  protecting  residential  privacy.  215  Government  [need  not]  make  progress  on  every  front  before  it  can  make 
 progress  on  any  front.  216 
 68.  We  believe  that  the  facts  here  are  easily  distinguishable  from  those  in  Rubin  v.  Coors  Brewing  Company,  514  U.  S.  476  (1995)  and  City  of  Cincinnati  v.  Discovery  Network,  507 


 U.  S.  410  (1993).  In  Coors,  the  Court  struck  down  a  prohibition  against  disclosure  of  alcoholic  content  on  labels  or  in  advertising  that  applied  to  beer  but  not  to  wine  or  distilled  spirits,  finding 
 that  the  irrationality  of  this  unique  and  puzzling  regulatory  framework  ensures  that  the  labeling  ban  will  fail  to  achieve  [the  Governments  interest  in  combating  strength  wars.]  In  Discovery 


 210  See  supra  para.  19. 
 211  Florida  Bar  v.  Went  For  It,  Inc.,  515  U.  S.  618,  626  (1995)  (citations  omitted). 
 212  Id.  at  628  (citation  omitted). 
 213  See,  e.  g.,  Brenda  J.  Donat  Comments;  Alice  and  Bill  Frazee  Comments;  Tammy  Packett  Comments. 
 214  See  e.  g.,  H.  R.  REP.  NO.  108-  8  at  3  (2003),  reprinted  in  2003  U.  S.  C.  C.  A.  N.  688,  670  ([  i]  t  is  the  strongly  held 
 view  of  the  Committee  that  a  national  do-  not-  call  list  is  in  the  best  interest  of  consumers,  businesses  and  consumer  protection  authorities.  This  legislation  is  an  important  step  toward  a  one-  stop  solution  to  reducing  telemarketing 


 abuses.). 
 215  See,  e.  g.,  ATA  Comments  at  85-  88  and  WorldCom  Comments  at  27-  33. 


 216  United  States  v.  Edge  Broadcasting  Company,  509  U.  S.  418,  434  (1993).  See  also  Moser  v.  FCC,  46  F.  3d  at 
 975  (  Congress  may  reduce  the  volume  of  telemarketing  calls  without  completely  eliminating  the  calls.). 
41

 Federal  Communications  Commission  FCC  03-  153 
 42 
 Network,  the  Court  struck  down  an  ordinance  which  banned  62  newsracks  containing  commercial  publications  but  did  not  ban  1,500-  2,000  newsracks  containing  newspapers,  finding 
 that  the  distinction  bears  no  relationship  whatsoever  to  the  particular  [aesthetic]  interests  that  the  city  has  asserted.  Here,  Congress  decision  to  exclude  tax-  exempt  nonprofit  organizations 
 from  the  definition  of  telemarketing  in  the  TCPA  was  both  rational  and  related  to  its  interest  in  protecting  residential  privacy.  The  House  Report  finds  that  the  record  suggests  that  most 
 unwanted  telephone  solicitations  are  commercial  in  nature.  .  .  .[  T]  he  Committee  also  reached  the  conclusion,  based  on  the  evidence,  that    calls  [from  tax-  exempt  nonprofit  organizations]  are 
 less  intrusive  to  consumers  because  they  are  more  expected.  Consequently,  the  two  main  sources  of  consumer  problems    high  volume  of  solicitations  and  unexpected  solicitations    are 
 not  present  in  solicitations  by  nonprofit  organizations.  217 
 69.  Commenters  in  our  record  also  express  the  concern  that  subjecting  tax-  exempt  nonprofit  organizations  to  the  national  do-  not-  call  requirements  may  sweep  too  broadly  because 


 it  would  prompt  some  consumers  to  accept  blocking  of  non-  commercial,  charitable  calls  to  which  they  might  not  otherwise  object  as  an  undesired  effect  of  registering  on  the  national 
 database  to  stop  unwanted  commercial  solicitation  calls.  Both  the  Eighth  and  the  Ninth  Circuits  found  that  the  provisions  of  the  TCPA,  which  bans  unsolicited  commercial  faxes  but  not  non-commercial 
 faxes,  directly  advance  a  substantial  government  interest,  218  and  we  believe  that  the  same  distinction  may  be  applied  to  the  national  do-  not-  call  registry.  219 


 70.  We  find  under  the  third  prong  of  the  Central  Hudson  test  that  our  proposed  regulations  are  not  more  extensive  than  necessary  to  protect  residential  privacy.  The  Supreme 
 Court  has  made  clear  that  with  respect  to  this  prong,  the  differences  between  commercial  speech  and  noncommercial  speech  are  manifest.  220  The  Court  held  that: 


 [T]  he  least  restrictive  means  test  has  no  role  in  the  commercial  speech  context.  What  our  decisions  require,  instead,  is  a  fit 
 between  the  legislatures  ends  and  the  means  chosen  to  accomplish  those  ends,  a  fit  that  is  not  necessarily  perfect,  but  reasonable;  that 


 217  H.  R.  REP.  NO.  102-  317  at  16  (1991). 
 218  See  American  Blast  Fax  and  Destination  Ventures. 
 219  We  reject  Vectors  argument  that  because  its  direct  sellers  and  others  make  a  de  minimis  number  of  calls 
 relative  to  the  high-  volume  of  calls  that  telemarketers  make,  that  the  national  do-  not-  call  registry,  as  applied  to  companies  like  Vectors,  would  not  directly  or  materially  advance  the  governments  interest.  Vector  Comments 


 at  12-  13.  The  Supreme  Court  has  held,  in  applying  Central  Hudsons  second  prong,  that  the  state  does  not  have  to  demonstrate  that  the  governments  interest  is  advanced  as  applied  to  every  case.  See  Ward  v.  Rock  Against 
 Racism,  491  U.  S.  781,  801  (1989)  ([  T]  he  validity  of  the  regulation  depends  on  the  relation  it  bears  to  the  overall  problem  the  government  seeks  to  correct,  not  on  the  extent  to  which  it  furthers  the  governments  interest  in  an 
 individual  case.);  Edge  Broadcasting,  509  U.  S.  418,  discussing  Ohralik  v.  Ohio  State  Bar  Assn.,  436  U.  S.  447  (1978)  ([  T]  he  State  was  entitled  to  protect  its  interest  by  applying  a  prophylactic  rule  to  those  circumstances 
 generally;  we  declined  to  go  further  and  to  prove  that  the  state  interests  supporting  the  rule  actually  were  advanced  by  applying  the  rule  in    [the]  particular  case.). 


 220  Florida  Bar,  515  U.  S.  618,  632. 
42

 Federal  Communications  Commission  FCC  03-  153 
 43 
 represents  not  necessarily  the  single  best  disposition  but  one  whose  scope  is  in  proportion  to  the  interest  served  .  [T]  he  existence  of 
 numerous  and  obvious  less-  burdensome  alternatives  to  the  restriction  on  commercial  speech  is  certainly  a  relevant 
 consideration  in  determining  whether  the  fit  between  the  ends  and  means  is  reasonable.  221 


 In  Florida  Bar,  the  Supreme  Court  found  that  a  prohibition  against  lawyers  using  direct  mail  to  solicit  personal  injury  or  wrongful  death  clients  within  30  days  of  an  accident  was  not  more 
 extensive  than  necessary  to  protect  the  privacy  and  tranquility  of  personal  injury  victims  and  their  loved  ones  against  intrusive,  unsolicited  contact  by  lawyers.  222  Similarly,  the  Ninth 
 Circuit  has  found  that  the  TCPAs  ban  on  prerecorded  telemarketing  calls  constitutes  a  reasonable  fit  with  the  governments  legitimate  interest  in  protecting  residential  privacy.  223 


 71.  Here,  we  find  that  our  regulations  meet  the  requirements  of  Central  Hudsons  third  prong.  Pursuant  to  our  regulations,  we  adopt  a  single,  national  do-  not-  call  database  that  we 
 will  enforce  jointly  with  the  FTC.  Our  rules  mandate  that  common  carriers  providing  telephone  exchange  service  shall  inform  their  subscribers  of  their  right  to  register  on  the  database  either 
 through  a  toll-  free  telephone  call  or  over  the  Internet.  Furthermore,  telemarketers  and  sellers  must  gain  access  to  telephone  numbers  in  the  national  database  and  will  be  able  to  do  so  by 
 means  of  a  fully  automated,  secure  website  dedicated  to  providing  information  to  these  entities.  In  addition,  sellers  will  be  assessed  an  annual  fee  based  upon  the  number  of  area  codes  they  want 
 to  assess,  with  the  maximum  annual  fee  capped  at  $7,250.  Our  rules  also  provide  that  the  national  database  will  be  updated  continuously,  and  telemarketers  must  update  their  lists 
 quarterly.  We  find  that  our  regulations  are  a  reasonable  fit  between  the  ends  and  means  and  are  not  as  restrictive  as  the  bans  upheld  in  the  cases  cited  above.  In  Florida  Bar,  the  Supreme  Court 
 upheld  an  absolute  ban  against  lawyers  using  direct  mail  to  solicit  personal  injury  or  wrongful  death  clients  within  30  days  of  an  accident.  Similarly,  the  Ninth  Circuit  has  upheld  the  TCPAs 
 absolute  ban  on  prerecorded  telemarketing  calls,  and  both  the  Eighth  and  Ninth  Circuit  have  upheld  the  TCPAs  absolute  ban  on  unsolicited  faxes.  Here,  our  regulations  do  not  absolutely 
 ban  telemarketing  calls.  Rather,  they  provide  a  mechanism  by  which  individual  consumers  may  choose  not  to  receive  telemarketing  calls.  We  also  note  that  there  are  many  other  ways  available 
 to  market  products  to  consumers,  such  as  newspapers,  television,  radio  advertising  and  direct  mail.  224  In  addition,  there  simply  are  not  numerous  and  obvious  less-  burdensome  alternatives 
 to  the  national  do-  not-  call  registry.  The  record  clearly  demonstrates  widespread  consumer 


 221  Id. 
 222  Id.  at  624. 
 223  Moser,  46  F.  3d  at  975;  see  also  American  Blast  Fax,  323  F.  3d  at  658-  60  (TCPAs  ban  on  unsolicited  faxes  was 
 not  more  extensive  than  necessary  to  prevent    unwanted  fax  advertising  from  shifting  advertising  costs  to  unwilling  consumers  and  interfering  with  their  fax  machines.);  Destination  Ventures  (FCC  sustained  its  burden 


 of  demonstrating  reasonable  fit  between  interest  in  preventing  shift  of  advertising  costs  to  consumers  and  banning  unsolicited  commercial  faxes.). 


 224  See  Florida  Bar,  515  U.  S.  at  633-  34. 
43

 Federal  Communications  Commission  FCC  03-  153 
 44 
 dissatisfaction  both  with  the  effectiveness  of  the  current  company-  specific  rules  that  are  currently  in  place  225  and  the  effectiveness  and  expense  of  certain  technological  alternatives  to 
 reduce  telephone  solicitations.  226  We  also  note  that  many  of  the  burdens  of  the  national  do-not-  call  registry    issues  concerning  its  costs,  accuracy,  and  privacy    have  been  addressed  by 
 advances  in  computer  technology  and  software  over  the  last  ten  years.  227  Thus,  we  find  that  our  regulations  implementing  the  national  do-  not-  call  registry  are  consistent  with  the  First 
 Amendment  and  the  framework  established  in  Central  Hudson. 
 72.  Furthermore,  we  reject  the  arguments  that  the  Central  Hudson  framework  is  not  appropriate  and  that  strict  scrutiny  is  required  because  the  regulations  implementing  the  national 


 do-  not-  call  list  are  content-  based,  due  to  the  TCPAs  exemptions  for  non-  profit  organizations  and  established  business  relationships.  228  For  support,  commenters  cite  to  Discovery  Network, 
 507  U.  S.  410,  in  which  the  Court  struck  down  Cincinnatis  ordinance  which  banned  newsracks  containing  commercial  publications  but  did  not  ban  newsracks  containing  newspapers.  The 
 Court  found  that  the  regulation  could  neither  be  justified  as  a  restriction  on  commercial  speech  under  Central  Hudson,  nor  could  it  be  upheld  as  a  valid  time,  place,  or  manner  restriction  on 
 protected  speech.  229  The  Court  explained  that  the  government  may  impose  reasonable  restrictions  on  the  time,  place  or  manner  of  engaging  in  protected  speech  provided  that  they  are 
 adequately  justified  without  reference  to  the  content  of  the  regulated  speech.  230  In  this  case,  the  Court  held  that  the  Citys  ban  which  covered  commercial  publications  but  not  newspapers 
 was  content-  based.  231  It  is  the  absence  of  a  neutral  justification  for  its  selective  ban  on  newsracks  that  prevents  the  city  from  defending  its  newsrack  policy  as  content  neutral.  232 


 225  See  supra  para.  19. 
 226  See  supra  para.  39. 
 227  See  supra  paras.  30-  32.  We  also  reject  Vectors  argument  that  the  failure  in  our  rules  to  provide  an  exemption 
 for  direct  sellers  and  others  who  make  a  de  minimis  number  of  calls  means  that  our  regulations  do  not  meet  the  requirement  of  Central  Hudsons  third  prong  of  being  narrowly  tailored  to  ensure  that    [they  are]  no  more 


 extensive  than  necessary  to  serve  the  governmental  interest.  Vector  Comments  at  10,  quoting  Central  Hudson,  447  U.  S.  at  565-  66.  As  stated  above,  the  Supreme  Court  requires  a  not  necessarily  perfect  but,  reasonable  fit, 
 Florida  Bar,  515  U.  S.  at  632.  In  upholding  a  ban  which  prohibited  lawyers  from  using  direct  mail  to  solicit  personal  injury  or  wrongful  death  clients  within  30  days  of  an  accident,  even  in  cases  where  the  injuries  or  grief 
 was  relatively  minor,  the  Court  held  that,  We  find  little  deficiency  in  the  bans  failure  to  distinguish  among  injured  Floridians  by  the  severity  of  their  pain  or  the  intensity  of  their  grief.  The  Bars  rule  is  reasonably  well 
 tailored  to  its  stated  objective.  Id.  at  633.  Similarly,  we  find  our  regulations  implementing  the  national  do-  not-call  registry  do  not  need  to  provide  for  an  exemption  for  direct  sellers  and  others  who  make  a  de  minimis  number 
 of  calls  in  order  to  be  a  reasonable  fit  between  the  governmental  ends  and  means. 
 228  See  ATA  Comments  at  64-  79  and  WorldCom  Comments  at  36-  38. 


 229  City  of  Cincinnati  v.  Discovery  Network  Inc.  et  al,  507  U.  S.  410  at  430  (1993). 
 230  Id.  at  428  (citation  omitted). 
 231  Id.  at  429. 
 232  Id.  at  429-  30. 
44

 Federal  Communications  Commission  FCC  03-  153 
 45 
 73.  Here,  however,  there  was  a  neutral  justification  for  Congress  decision  to  exclude  non-  profit  organizations.  As  we  noted  supra,  Congress  found  that  the  two  sources  of  consumer 
 problems    high  volume  of  solicitations  and  unexpected  solicitations    are  not  present  in  solicitations  by  nonprofit  organizations.  233  Congress  also  made  a  similar  finding  with  respect  to 
 solicitations  based  on  established  business  relationships.  234  Consumers  are  more  likely  to  anticipate  contacts  from  companies  with  whom  they  have  an  existing  relationship  and  the 
 volume  of  such  calls  will  most  likely  be  lower.  Furthermore,  as  the  Eighth  Circuit  noted  when  it  distinguished  the  Discovery  Network  case  in  upholding  the  TCPAs  ban  on  unsolicited  faxes  that 
 applies  to  commercial  speech  but  not  to  noncommercial  speech,  the  government  may  regulate  one  aspect  of  a  problem  without  regulating  all  others.  235  Thus,  we  believe  it  is  clear  that  our  do-not- 
 call  registry  regulations  may  apply  to  commercial  solicitations  without  applying  to  tax-exempt  nonprofit  solicitations,  and  that  such  regulations  are  not  subject  to  a  higher  level  of 
 scrutiny.  Indeed,  we  agree  with  the  FTC  that  regulation  of  non-  profit  solicitations  are  subject  to  a  higher  level  of  scrutiny  than  solicitations  of  commercial  speech,  236  and  greater  care  must  be 


 233  H.  R.  REP.  NO.  102-  317,  at  16  (1991).  ATA  asserts  that  we  cannot  give  weight  to  Congress  findings  to 
 support  our  decision  to  exclude  non-  profit  organizations  from  our  regulations  implementing  the  do-  not-  call  registry.  ATA  Comments  at  60-  61.  ATA  argues  that  we  may  only  consider  the  record  compiled  in  this 


 proceeding  and  that  its  market  survey  of  consumer  attitudes  regarding  telemarketing  commissioned  in  November  2002  calls  into  question  the  validity  of  the  Congressional  findings  distinguishing  between  non-  profit  and 
 commercial  calls.  ATA  Comments  at  73-  74.  We  disagree.  As  a  preliminary  matter,  it  is  not  clear  to  us  that  ATAs  data  support  its  assertion  that  consumers  make  no  distinction  between  commercial  and  charitable  calls. 
 For  example,  while  ATA  does  not  provide  exact  data,  it  appears  from  the  bar  graph  illustrating  the  data  that  approximately  twice  as  many  consumers  find  charitable  calls  more  acceptable  than  other  types  of  unsolicited 
 calls  than  find  commercial  calls  more  acceptable  than  other  types  of  unsolicited  calls  (approximately  18%  v.  9%).  The  Congressional  findings  were  supported  by  a  poll  undertaken  by  the  National  Association  of  Consumer 
 Agency  Administrators  of  its  state  level  members  for  statistical  data  describing  the  extent  to  which  consumer  complaints  about  unsolicited  telemarketing  calls  involved  commercial,  charitable,  or  political  calls.  The  evidence 
 showed  that  the  overwhelming  majority  of  consumer  complaints  were  about  commercial  calls.  H.  R.  REP.  NO.  102-  137  at  16.  Both  the  Eighth  and  Ninth  Circuits  have  credited  Congress  findings  relating  to  the  TCPA.  See 
 American  Blast  Fax,  323  F.  3d  at  655-  656  (citing  Congress  evidence  in  upholding  the  distinction  between  commercial  and  non-  commercial  faxes  in  the  TCPA)  and  Moser  v.  FCC,  46  F.  3d  at  974  (finding  that  [  t]  here  was 
 significant  evidence  before  Congress  of  consumer  concerns  about  telephone  solicitation  before  the  passage  of  the  TCPA).  When  Congress  makes  findings  on  essentially  factual  issues    those  findings  are  entitled  to  a  great  deal 
 of  deference,  inasmuch  as  Congress  as  an  institution  is  better  equipped  to  amass  and  evaluate  the  vast  amounts  of  data.  Walters  v.  National  Assn  of  Radiation  Survivors,  473  U.  S.  305,  331  n.  12  (1985).  We  also  note  that  in  its 
 1992  TCPA  Order,  the  Commission  stated  that  no  evidence  had  been  presented  to  show  that  non-  commercial  calls  represented  as  serious  a  concern  for  telephone  subscribers  as  unsolicited  commercial  calls  and  unsolicited 
 commercial  calls  and  concluded,  based  on  the  comments  and  the  legislative  history  of  the  TCPA,  that  it  would  not  seek  additional  authority  to  curb  calls  by  tax-  exempt  organizations.  TCPA  Order,  7  FCC  Rcd  at  8773-  8774,  para. 
 40.  Congress  recently  reaffirmed  this  judgment  by  requiring  us  to  maximize  consistency  with  the  rule  promulgated  by  the  Federal  Trade  Commission,  which  contains  an  exemption  for  non-  profit  organizations. 


 234  Id.  at  14. 
 235  Missouri  ex  rel.  v.  American  Blast  Fax,  323  F.  3d  at  656  n.  4  (citing  United  States  v.  Edge  Broad.  Co.,  509  U.  S. 
 418  at  434). 
 236  FTC  Order,  68  Fed.  Reg.  at  4636,  n.  675,  quoting  from  Metromedia  v.  San  Diego,  453  U.  S.  490,  513  (1981) 
 ([  I]  nsofar  as  it  regulates  commercial  speech,  the  San  Diego  ordinance  meets  the  constitutional  requirements  of  Central  Hudson  .  It  does  not  follow,  however,  that  San  Diegos  ban  on  signs  carrying  noncommercial 


 (continued.) 
45

 Federal  Communications  Commission  FCC  03-  153 
 46 
 given  [both]  to  ensuring  that  the  governmental  interest  is  actually  advanced  by  the  regulatory  remedy,  and  [to]  tailoring  the  regulation  narrowly  so  as  to  minimize  its  impact  on  First 
 Amendment  rights.  237 
 5.  Consistency  with  State  and  FTC  Do-  Not-  Call  Rules 
 74.  We  conclude  that  harmonization  of  the  various  state  and  federal  do-  not-  call  programs  to  the  greatest  extent  possible  will  reduce  the  potential  for  consumer  confusion  and 


 regulatory  burdens  on  the  telemarketing  industry.  238  An  underlying  concern  expressed  by  many  commenters  in  this  proceeding  is  the  potential  for  duplication  of  effort  and/  or  inconsistency  in 
 the  rules  relating  to  the  state  and  federal  do-  not-  call  programs.  Congress  has  indicated  a  similar  concern  in  requiring  the  Commission  to  maximize  consistency  with  the  FTCs  rules.  239  As 
 discussed  below,  we  find  that  the  use  of  a  single  national  database  of  do-  not-  call  registrants  will  ultimately  prove  the  most  efficient  and  economical  means  for  consumer  registrations  and  access 
 for  compliance  purposes  by  telemarketing  entities  and  regulators. 
 75.  The  states  have  a  long  history  of  regulating  telemarketing  practices,  and  we  believe  that  it  is  critical  to  combine  the  resources  and  expertise  of  the  state  and  federal 


 governments  to  ensure  compliance  with  the  national  do-  not-  call  rules.  In  fact,  the  TCPA  specifically  outlines  a  role  for  the  states  in  this  process.  240  In  an  effort  to  reconcile  the  state  and 
 federal  roles,  we  have  conducted  several  meetings  with  the  states  and  FTC.  241  We  expect  such  coordination  to  be  ongoing  in  an  effort  to  promote  the  continued  effectiveness  of  the  national  do-not- 
 call  program.  We  clarify  below  the  respective  governmental  roles  in  this  process  under  the  TCPA.  As  noted  above,  we  intend  to  develop  a  Memorandum  of  Understanding  with  the  FTC  in 
 the  near  future  outlining  the  respective  federal  responsibilities  under  the  national  do-  not-  call  rules.  We  note  that  a  few  commenters  have  expressed  concern  that  the  FTC  and  this 
 Commission  may  adopt  separate  national  do-  not-  call  lists.  242  We  reiterate  here  that  there  will  be  only  one  national  database. 


 (Continued  from  previous  page)  advertising  is  also  valid    Commercial  speech  cases  have  consistently  accorded  noncommercial  speech  a 
 greater  a  greater  degree  of  protection  than  commercial  speech.)  and  citing  Watchtower  Bible  and  Tract  Socy  v.  Village  of  Stratton,  122  S.  Ct.  2080  (summarized  by  the  FTC  Order  as  the  Court  invalidated  an  ordinance  that 
 required  anyone  who  wanted  to  engage  in  door-  to-  door  canvassing  or  soliciting  to  obtain  a  permit  before  doing  so,  the  Court  went  out  of  its  way  to  suggest  that  the  ordinance  may  have  been  constitutional  if  it  were  limited  to 
 commercial  speech.). 
 237  FTC  Order,  68  Fed.  Reg.  at  4636. 


 238  Thirty-  six  states  have  adopted  no-  call  laws. 
 239  See  Do-  Not-  Call  Act,  Sec.  3. 
 240  See  47  U.  S.  C.    227(  e)  and  (f). 
 241  See  Letter  from  James  Bradford  Ramsay,  NARUC  General  Counsel,  to  FCC  filed  March  14,  2003  (NARUC  ex 
 parte);  NARUC  Winter  Committee  Meetings,  February  23-  26,  2003,  at  which  FCC  and  FTC  staff  discussed  the  national  do-  not-  call  registry  and  ways  to  harmonize  federal  and  state  programs.  See  also  FTC  Further  Comments. 


 242  See,  e.  g.,  AARP  Comments  at  3;  Visa  Comments  at  1-  3. 
46

 Federal  Communications  Commission  FCC  03-  153 
 47 
 76.  Use  of  a  Single  Database.  We  conclude  that  the  use  of  a  single  national  do-  not-call  database,  administered  by  the  vendor  selected  by  the  FTC,  will  ultimately  prove  the  most 
 efficient  and  economical  means  for  consumer  registrations  and  access  by  telemarketers  and  regulators.  The  establishment  of  a  single  database  of  registrants  will  allow  consumers  to  register 
 their  requests  not  to  be  called  in  a  single  transaction  with  one  governmental  agency.  In  addition,  telemarketers  may  access  consumer  registrations  for  purposes  of  compliance  with  the  do-  not-  call 
 rules  through  one  visit  to  a  national  database.  This  will  substantially  alleviate  the  potential  for  consumer  confusion  and  administrative  burden  on  telemarketers  that  would  exist  if  required  to 
 access  multiple  databases.  In  addition,  we  note  that  section  227(  e)(  2)  prohibits  states,  in  regulating  telephone  solicitations,  from  using  any  database,  list,  or  list  system  that  does  not 
 include  the  part  of  such  single  national  database  that  relates  to  that  state.  243  Thus,  pursuant  to  this  requirement,  any  individual  state  do-  not-  call  database  must  include  all  of  the  registrants  on 
 the  national  database  for  that  state.  We  determine  that  the  administrator  of  the  national  database  shall  make  the  numbers  in  the  database  available  to  the  states  as  required  by  the  TCPA.  244 


 77.  We  believe  the  most  efficient  way  to  create  a  single  national  database  will  be  to  download  the  existing  state  registrations  into  the  national  database.  The  FTC  has  indicated  that 
 the  national  database  is  designed  to  allow  the  states  to  download  into  the  national  registry    at  no  cost    the  telephone  numbers  of  consumers  that  have  registered  with  their  state  do-  not-  call 
 lists.  245  As  noted  above,  we  believe  that  consumers,  telemarketers,  and  regulators  will  benefit  from  the  efficiencies  derived  from  the  creation  of  a  single  do-  not-  call  database.  We  encourage 
 states  to  work  diligently  toward  this  goal.  We  recognize  that  a  reasonable  transition  period  may  be  required  to  incorporate  the  state  registrations  in  a  few  states  into  the  national  database.  246  We 
 therefore  adopt  an  18-  month  transition  period  for  states  to  download  their  state  lists  into  the  national  database.  Having  an  18-  month  transition  period  will  allow  states  that  do  not  have  full-time 
 legislatures  to  complete  a  legislative  cycle  and  create  laws  that  would  authorize  the  use  of  a  national  list.  In  addition,  this  transition  period  is  consistent  with  the  amount  of  time  that  the  FTC 
 anticipates  it  would  take  to  incorporate  the  states  lists  into  the  national  database.  Although  we  do  not  preempt  or  require  states  to  discontinue  the  use  of  their  own  databases  at  this  time,  once 
 the  national  do-  not-  call  registry  goes  into  effect,  states  may  not,  in  their  regulation  of  telephone  solicitations,  require  the  use  of  any  database,  list,  or  listing  system  that  does  not  include  the  part 
 of  [the  national  do-  not-  call  registry]  that  relates  to  [each]  State.  247  As  noted  above,  we  believe  that  there  are  significant  advantages  and  efficiencies  to  be  derived  from  the  creation  and  use  of  a 
 single  database  for  all  parties,  including  states,  and  we  strongly  encourage  states  to  assist  in  this  effort.  The  Commission  intends  to  work  diligently  with  the  states  and  FTC  in  an  effort  to 


 243  See  47  U.  S.  C.    227(  e)(  2). 
 244  See  new  rule  at  47  C.  F.  R.    64.1200(  h). 
 245  FTC  Order,  68  Fed.  Reg.  at  4641.  Approximately  19.2  million  consumers  have  registered  on  state  do-  not-  call 
 lists. 
 246  The  FTC  estimates  that  many  states  will  be  able  to  transfer  their  do-  not-  call  registrations  to  the  national 
 database  prior  to  its  implementation  on  October  1,  2003.  For  other  states  it  may  take  from  12  to  18  months  to  achieve  this  result.  FTC  Order,  68  Feg.  Reg.  at  4641. 


 247  See  47  U.  S.  C.    227(  e)(  2). 
47

 Federal  Communications  Commission  FCC  03-  153 
 48 
 establish  a  single  do-  not-  call  database. 
 78.  Interplay  of  State  and  Federal  Do-  Not-  Call  Regulations.  In  the  2002  Notice,  we  generally  raised  the  issue  of  the  interplay  of  state  and  federal  do-  not-  call  statutes  and 


 regulations.  248  In  response,  several  parties  argued  that  state  regulations  must  or  should  be  preempted  in  whole,  249  or  at  least  in  part,  250  and  several  other  parties  argued  that  the  Commission 
 cannot  or  should  not  preempt.  251  For  example,  several  industry  commenters  contend  that  the  TCPA  provides  the  Commission  with  the  authority  to  preempt  state  do-  not-  call  regulations.  252 
 These  commenters  contend  that  Congress  intended  the  TCPA  to  occupy  the  field  or,  at  the  very  least,  intended  to  preempt  state  regulation  of  interstate  telemarketing.  Many  state  and  consumer 
 commenters  note,  however,  that  the  TCPA  contemplates  a  role  for  the  states  in  regulating  telemarketing  and  specifically  prohibits  preemption  of  state  law  in  certain  instances.  253  States 
 and  consumers  note  that  state  do-  not-  call  regulations  have  been  a  successful  initiative  in  protecting  consumer  privacy  rights.  In  addition,  several  commenters  note  the  importance  of 
 federal  and  state  cooperation  in  enforcing  the  national  do-  not-  call  regulations.  254  The  record  also  indicates  that  states  have  historically  enforced  their  own  state  statutes  within,  as  well  as  across 
 state  lines.  255  The  statute  also  contains  a  savings  clause  for  state  proceedings  to  enforce  civil  or 


 248  See  2002  Notice,  17  FCC  Rcd  at  17493-  96,  paras.  60-  66. 
 249  See,  e.  g.,  DMA  Reply  Comments  at  5.  See  also  Nextel  Comments  at  4-  6;  Visa  Comments  at  3-  4;  Wells  Fargo 
 Comments  at  1-  2;  Xpedite  Comments  at  14-  16  (arguing  that  the  Commission  should  preempt  to  create  more  uniform  rules).  We  note  that,  although  Bank  One  raises  its  preemption  arguments,  in  part,  by  referencing  the 


 Commerce  Clause,  its  analysis  clearly  focuses  on  the  Commissions  authority  under  the  Communications  Act  to  preempt.  (  Congress  general  power  to  regulate  interstate  commerce  and  its  delegation  of  that  authority  to  the 
 FCC  in  the  Communications  Act  of  1934.  Bank  One  Further  Comments  at  5.)  Moreover,  to  the  extent  Bank  One  suggests  that,  in  the  absence  of  federal  statutory  preemption,  the  Commerce  Clause  operates  to  preempt  states 
 from  unduly  burdening  interstate  commerce,  such  a  finding  would  require  a  more  particularized  showing  with  regard  to  the  specific  statute  at  issue  and  the  burden  on  interstate  commerce.  See  e.  g.,  Exxon  Corp.  v.  Governor  of 
 Md.,  437  U.  S.  117  (1978)  (considering  whether  state  statute  that  prohibited  oil  producers  and  refiners  from  operating  retail  gas  stations  impermissibly  burdened  interstate  commerce.). 


 250  See,  e.  g.,  WorldCom  Reply  Comments  at  27-  30  (arguing  that  state  do-  not-  call  lists  are  preempted  by  operation 
 of  law  to  the  extent  they  purport  to  regulate  interstate  calls). 
 251  See,  e.  g.,  NAAG  Comments  at  12;  Attorney  General  of  Indiana  Further  Reply  Comments. 


 252  See,  e.  g.,  American  Express  Comments  at  2-  3;  Nextel  Comments  at  4-  5;  Visa  Reply  Comments  8-  9. 
 253  See,  e.  g.,  NAAG  Comments  at  12;  NARUC  Comments  at  3-  4;  North  Dakota  PSC  Comments  at  2;  Attorney 
 General  of  Indiana  Further  Reply  Comments. 
 254  See,  e.  g.  NARUC  Comments  at  3-  4;  North  Dakota  PSC  Comments  at  2;  OPCDC  Comments  at  3;  Texas  PUC 
 Comments.  In  addition,  a  large  number  of  consumers  filed  comments  in  this  proceeding  indicating  that  state  do-not-  call  regulations  have  improved  their  privacy  rights.  See,  e.  g.,  Brenda  J.  Donat  Comments  (cancer  patient 


 appreciates  reduction  in  calls  due  to  Indiana  Telephone  Privacy  Act);  Alice  and  Bill  Frazee  Comments;  Tammy  Puckett  Comments  (Indiana  law  provides  for  quiet  for  terminally  ill  family  member). 


 255  See  NAAG  Comments  at  2.  NAAG  estimates  that  approximately  150  state  enforcement  actions  have  been 
 taken  against  telemarketing  companies  call  across  state  lines. 
48

 Federal  Communications  Commission  FCC  03-  153 
 49 
 criminal  statutes,  256  and  at  least  one  federal  court  has  found  that  the  TCPA  does  not  preempt  state  regulation  of  autodialers  that  are  not  in  actual  conflict  with  the  TCPA.  257 
 79.  The  main  area  of  difference  between  the  state  and  federal  do-  not-  call  programs  relates  to  the  exemptions  created  from  the  respective  do-  not-  call  regulations.  Some  state 
 regulations  are  less  restrictive  by  adopting  exemptions  that  are  not  recognized  under  federal  law.  For  example,  some  states  have  adopted  exemptions  for  insurance  agents,  newspapers,  or  small 
 businesses.  258  In  addition,  a  few  states  have  enacted  laws  that  are  more  restrictive  than  the  federal  regulations  by  not  recognizing  federal  exemptions  such  as  the  established  business 
 relationship.  259  Most  states,  however,  exempt  nonprofit  organizations  and  companies  with  whom  the  consumer  has  an  established  business  relationship  in  some  manner  consistent  with  federal 
 regulations.  260 
 80.  At  the  outset,  we  note  that  many  states  have  not  adopted  any  do-  not-  call  rules.  The  national  do-  not-  call  rules  will  govern  exclusively  in  these  states  for  both  intrastate  and 


 interstate  telephone  solicitations.  261  Pursuant  to  section  227(  f)(  1),  all  states  have  the  ability  to  enforce  violations  of  the  TCPA,  including  do-  not-  call  violations,  in  federal  district  court.  262 
 Thus,  we  conclude  that  there  is  no  basis  for  conflict  regarding  the  application  of  do-  not-  call  rules  in  those  states  that  have  not  adopted  do-  not-  call  regulations. 


 81.  For  those  states  that  have  adopted  do-  not-  call  regulations,  we  make  the  following  determinations.  First,  we  conclude  that,  by  operation  of  general  conflict  preemption  law,  the 
 federal  rules  constitute  a  floor,  and  therefore  would  supersede  all  less  restrictive  state  do-  not-  call  rules.  263  We  believe  that  any  such  rules  would  frustrate  Congress  purposes  and  objectives  in 
 promulgating  the  TCPA.  Specifically,  application  of  less  restrictive  state  exemptions  directly  conflicts  with  the  federal  objectives  in  protecting  consumer  privacy  rights  under  the  TCPA. 
 Thus,  telemarketers  must  comply  with  the  federal  do-  not-  call  rules  even  if  the  state  in  which  they 


 256  47  U.  S.  C.    227(  f)(  6)(  Nothing  contained  in  this  subsection  shall  be  construed  to  prohibit  an  authorized  State 
 official  from  proceeding  in  State  court  on  the  basis  of  an  alleged  violation  of  any  general  civil  or  criminal  statute  of  such  State.). 


 257  Van  Bergen  v.  Minnesota,  59  F.  3d  1541,  1547-  48  (8th  Cir.  1995). 
 258  Ala.  Code  1975    8-  19A-  4;  Ark.  Code  Ann.    4-  99-  103;  Fla.  Stat.  Ann.    501.604. 
 259  Ind.  Code    24-  4.7-  1-  1  (no  EBR  exception);  Idaho  Code    48-  1003A  (nonprofit  exception  for  minors  only). 
 260  Alaska  Stat.    45.50.475;  Vt.  Stat.  Ann.  tit.  9    2464a;  Kan.  Stat.  Ann.    50-  670  and    50-  671. 
 261  Section  2(  b)  provides  the  Commission  with  the  authority  to  apply  the  TCPA  to  intrastate  communications.  See 
 47  U.  S.  C.    152(  b). 
 262  47  U.  S.  C.    227(  f)(  1). 


 263  See,  e.  g.,  Geier  v.  American  Honda  Motor  Co.,  529  U.  S.  861,  873  (2000)  (where  state  law  frustrates  the 
 purposes  and  objectives  of  Congress,  conflicting  state  law  is  nullified  by  the  Supremacy  Clause);  City  of  New  York  v.  FCC,  486  U.  S.  57,  64  (1988)  (  The  statutorily  authorized  regulations  of  an  agency  will  preempt  any  state 


 or  local  law  that  conflicts  with  such  regulations  or  frustrates  the  purposes  thereof.). 
49

 Federal  Communications  Commission  FCC  03-  153 
 50 
 are  telemarketing  has  adopted  an  otherwise  applicable  exemption.  Because  the  TCPA  applies  to  both  intrastate  and  interstate  communications,  the  minimum  requirements  for  compliance  are 
 therefore  uniform  throughout  the  nation.  We  believe  this  resolves  any  potential  confusion  for  industry  and  consumers  regarding  the  application  of  less  restrictive  state  do-  not-  call  rules. 


 82.  Second,  pursuant  to  section  227(  e)(  1),  we  recognize  that  states  may  adopt  more  restrictive  do-  not-  call  laws  governing  intrastate  telemarketing.  264  With  limited  exceptions,  the 
 TCPA  specifically  prohibits  the  preemption  of  any  state  law  that  imposes  more  restrictive  intrastate  requirements  or  regulations.  Section  227(  e)(  1)  further  limits  the  Commissions  ability 
 to  preempt  any  state  law  that  prohibits  certain  telemarketing  activities,  including  the  making  of  telephone  solicitations.  This  provision  is  ambiguous,  however,  as  to  whether  this  prohibition 
 applies  both  to  intrastate  and  interstate  calls,  265  and  is  silent  on  the  issue  of  whether  state  law  that  imposes  more  restrictive  regulations  on  interstate  telemarketing  calls  may  be  preempted.  As  set 
 forth  below,  however,  we  caution  that  more  restrictive  state  efforts  to  regulate  interstate  calling  would  almost  certainly  conflict  with  our  rules. 


 83.  We  recognize  that  states  traditionally  have  had  jurisdiction  over  only  intrastate  calls,  while  the  Commission  has  had  jurisdiction  over  interstate  calls.  266  Here,  Congress  enacted 
 section  227  and  amended  section  2(  b)  to  give  the  Commission  jurisdiction  over  both  interstate  and  intrastate  telemarketing  calls.  Congress  did  so  based  upon  the  concern  that  states  lack 
 jurisdiction  over  interstate  calls.  267  Although  section  227(  e)  gives  states  authority  to  impose  more  restrictive  intrastate  regulations,  we  believe  that  it  was  the  clear  intent  of  Congress 
 generally  to  promote  a  uniform  regulatory  scheme  under  which  telemarketers  would  not  be 


 264  47  U.  S.  C.    227(  e)(  1). 
 265  Section  227(  e)(  1)  provides  that: 


 (e)  Effect  on  State  Law.   
 (1)  State  Law  Not  Preempted.    Except  for  the  standards  prescribed  under  subsection  (d)  and  subject  to  paragraph  (2)  of  this  subsection,  nothing  in  this  section  or 


 in  the  regulations  prescribed  under  this  section  shall  preempt  any  State  law  that  imposes  more  restrictive  intrastate  requirements  or  regulations  on,  or  which  prohibits 


 (A)  the  use  of  telephone  facsimile  machines  or  other  electronic  devices  to  send  unsolicited  advertisements; 
 (B)  the  use  of  automatic  telephone  dialing  systems;  (C)  the  use  of  artificial  or  prerecorded  voice  messages;  or 
 (D)  the  making  of  telephone  solicitations. 
 266  See  Louisiana  Pub.  Serv.  Commn  v.  FCC,  476  U.  S.  355  (1986);  Smith  v.  Illinois  Bell  Telephone  Co.,  282  U.  S. 
 133  (1930). 
 267  S.  REP.  NO.  102-  178,  at  3;  see  also  id.  at  5  (  Federal  action  is  necessary  because  States  do  not  have  jurisdiction 
 to  protect  their  citizens  against  those  who  .  .  .  place  interstate  telephone  calls.);  Cong.  Rec.  S16205  (Nov.  7,  1991)  (remarks  of  Sen.  Hollings)  (  State  law  does  not,  and  cannot,  regulate  interstate  calls.);  TCPA    2(  7) 


 (finding  that  [  o]  ver  half  the  States  now  have  statutes  restricting  various  uses  of  the  telephone  for  marketing,  but  telemarketers  can  evade  their  prohibitions  through  interstate  operation.). 
50

 Federal  Communications  Commission  FCC  03-  153 
 51 
 subject  to  multiple,  conflicting  regulations.  268  We  conclude  that  inconsistent  interstate  rules  frustrate  the  federal  objective  of  creating  uniform  national  rules,  to  avoid  burdensome 
 compliance  costs  for  telemarketers  and  potential  consumer  confusion.  The  record  in  this  proceeding  supports  the  finding  that  application  of  inconsistent  rules  for  those  that  telemarket  on 
 a  nationwide  or  multi-  state  basis  creates  a  substantial  compliance  burden  for  those  entities.  269 
 84.  We  therefore  believe  that  any  state  regulation  of  interstate  telemarketing  calls  that  differs  from  our  rules  almost  certainly  would  conflict  with  and  frustrate  the  federal  scheme  and 


 almost  certainly  would  be  preempted.  We  will  consider  any  alleged  conflicts  between  state  and  federal  requirements  and  the  need  for  preemption  on  a  case-  by-  case  basis.  Accordingly,  any 
 party  that  believes  a  state  law  is  inconsistent  with  section  227  or  our  rules  may  seek  a  declaratory  ruling  from  the  Commission.  We  reiterate  the  interest  in  uniformity    as  recognized  by 
 Congress    and  encourage  states  to  avoid  subjecting  telemarketers  to  inconsistent  rules. 
 85.  NAAG  contends  that  states  have  historically  enforced  telemarketing  laws,  including  do-  not-  call  rules,  within,  as  well  as  across,  state  lines  pursuant  to  long-  arm 


 statutes.  270  According  to  NAAG,  these  state  actions  have  been  met  with  no  successful  challenges  from  telemarketers.  We  note  that  such  long-  arm  statutes  may  be  protected  under  section 
 227(  f)(  6)  which  provides  that  nothing  contained  in  this  subsection  shall  be  construed  to  prohibit  an  authorized  State  official  from  proceeding  in  State  court  on  the  basis  of  an  alleged  violation  of 
 any  general  civil  or  criminal  statute  of  such  state.  271  Nothing  that  we  do  in  this  order  prohibits  states  from  enforcing  state  regulations  that  are  consistent  with  the  TCPA  and  the  rules 
 established  under  this  order  in  state  court. 
 IV.  COMPANY  SPECIFIC  DO-  NOT-  CALL  LISTS 
 A.  Background 
 86.  In  the  1992  TCPA  Order,  the  Commission  adopted  a  company-  specific  do-  not-call  approach  to  protect  residential  telephone  subscriber  privacy  by  requiring  telemarketers  to 


 place  consumers  on  a  do-  not-  call  list  if  the  consumer  requests  not  to  receive  future  solicitations.  272  In  the  2002  Notice,  the  Commission  sought  comment  on  whether  the  company- 


 268  See,  e.  g.,  137  Cong.  Rec.  S18317-  01,  at  1  (1991)  (remarks  of  Sen.  Pressler)  (  The  Federal  Government  needs 
 to  act  now  on  uniform  legislation  to  protect  consumers.). 
 269  See,  e.  g.,  AWS  Further  Comments  at  7  (separate  state  requirements  will  confuse  customers  and  increase  costs 
 and  burdens  for  telemarketers);  Intuit  Further  Comments  at  2-  4  (Congress  intended  that  more  restrictive  state  laws  be  preempted);  Visa  Further  Comments  at  8  (contending  that  state  lists  that  are  inconsistent  with  federal 


 requirements  should  be  preempted). 
 270  NAAG  Comments  at  12. 


 271  47  U.  S.  C.    227(  f)(  6). 
 272  1992  TCPA  Order,  7  FCC  Rcd  at  8765-  66,  para.  23.  Specifically,  the  Commissions  rules  require  that  persons 
 or  entities  engaged  in  telephone  solicitations  must  have  a  written  policy  available  upon  demand  for  maintaining  a  do-  not-  call  list,  must  inform  and  train  any  personnel  engaged  in  telephone  solicitations  in  the  existence  and  use  of 


 the  list,  and  must  record  the  request  and  place  the  subscribers  name  and  telephone  number  on  the  do-  not-  call  list  (continued.) 
51

 Federal  Communications  Commission  FCC  03-  153 
 52 
 specific  approach  has  proven  effective  in  providing  consumers  with  a  means  to  curb  unwanted  telephone  solicitations.  273  The  Commission  noted  that  under  the  company-  specific  approach, 
 consumers  must  repeat  their  request  not  to  be  called  on  a  case-  by-  case  basis.  Given  the  apparent  increase  in  telemarketing  calls,  the  Commission  requested  comment  on  whether  this  approach 
 continues  to  balance  adequately  the  interests  of  consumers  with  those  of  legitimate  telemarketers.  In  particular,  the  Commission  sought  comment  on  whether  changes  in  the 
 marketplace  now  make  this  approach  unreasonably  burdensome  for  consumers,  including  elderly  and  disabled  consumers.  274  In  addition,  the  Commission  sought  comment  on  whether  the 
 company-  specific  approach  should  be  retained  if  the  FTC,  either  acting  alone  or  in  conjunction  with  this  Commission,  adopts  a  national  do-  not-  call  list.  Finally,  the  Commission  sought 
 comment  on  whether  to  consider  any  additional  modifications  to  the  company-  specific  list  such  as  requiring  companies  to  provide  a  toll-  free  number  or  website  to  register  such  requests.  275 


 87.  In  response  to  the  2002  Notice,  the  Commission  received  a  number  of  comments  relating  to  the  company-  specific  do-  not-  call  rules.  The  majority  of  individual  consumers 
 addressing  these  issues  contend  that  the  current  company-  specific  approach  is  inadequate  to  prevent  unwanted  telephone  solicitations.  276  In  general,  they  argue  that  the  company-  specific 
 approach  is  extremely  burdensome  to  consumers  who  must  repeat  their  request  to  every  telemarketer  that  calls;  such  requests  are  often  ignored  or,  in  the  case  of  abandoned  calls,  there  is 
 no  opportunity  to  make  such  a  request;  and  that  consumers  have  no  way  to  verify  whether  they  have  been  placed  on  such  lists.  277  In  addition,  many  consumers  contend  that  telemarketers  often 
 fail  to  identify  themselves  or  provide  written  copies  of  their  do-  not-  call  policies  as  required  by  the  Commissions  rules.  278  Some  consumers  note  that  these  limitations  make  it  difficult  to 
 pursue  any  private  right  of  action  against  telemarketers.  279  Commenters  also  indicate  that  telemarketers  frequently  inform  them  that  it  will  take  as  long  as  two  months  to  process  their  do-( 


 Continued  from  previous  page)  at  the  time  the  request  is  made.  47  C.  F.  R.    64.1200(  e)(  2)(  i)(  iii).  In  addition,  the  Commissions  rules  require 
 that  a  do-  not-  call  request  be  honored  for  a  period  of  ten  years  from  the  date  of  the  request.  47  C.  F.  R.    64.1200(  e)(  2)(  vi).  In  the  absence  of  a  specific  request  by  the  subscriber  to  the  contrary,  a  do-  not-  call  request 
 applies  to  the  particular  business  entity  making  the  call  or  on  whose  behalf  the  call  is  made,  and  does  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.  47  C.  F.  R.    64.1200(  e)(  2)(  v). 
 273  2002  Notice,  17  FCC  Rcd  at  17468-  72,  paras.  13-  20. 


 274  2002  Notice,  17  FCC  Rcd  at  17469-  70,  paras.  14-  15. 
 275  2002  Notice,  17  FCC  Rcd  at  17470,  para.  17. 
 276  Lyle  Bickley  Comments;  Pete  Nico,  Jr.  Comments. 
 277  See,  e.  g.,  James  D.  Gagnon  Comments;  Norman  C.  Hamer  Comments;  Rosanna  Santiago  Comments;  Elizabeth 
 J.  Yocam  Comments. 
 278  See,  e.  g.,  Harley  H.  Cudney  Comments  (telemarketers  fail  to  identify  themselves);  Timothy  Walton  Comments 
 (telemarketers  failure  to  send  do-  not-  call  policy  when  requested). 
 279  Gregory  S.  Reichenbach  Comments. 
52

 Federal  Communications  Commission  FCC  03-  153 
 53 
 not-  call  requests.  280  An  organization  representing  persons  with  disabilities  contends  that  such  consumers  often  cannot  communicate  requests  not  to  be  called  to  telemarketers.  281 
 88.  Many  industry  commenters  contend  that  the  company-  specific  approach  has  been  effective  and  that  a  national  do-  not-  call  list  is  therefore  unnecessary.  These  commenters  argue 
 that  the  advantages  of  the  company-  specific  approach,  as  identified  by  the  Commission  in  1992,  remain  valid  today.  Specifically,  these  commenters  contend  that  companies  already  maintain 
 such  lists,  the  company-  specific  approach  allows  consumers  to  halt  calls  selectively,  businesses  gain  useful  information  about  consumer  preferences,  consumer  confidentiality  is  protected,  and 
 the  costs  remain  on  the  telemarketer.  A  number  of  industry  commenters  request  that  the  retention  period  for  those  consumers  requesting  not  to  be  called  be  reduced  from  ten  years.  282  In 
 general,  industry  commenters  oppose  any  requirement  to  establish  a  toll-  free  number  or  website  for  consumers  to  register  and/  or  verify  their  do-  not-  call  requests.  283  These  commenters  contend 
 that  any  such  requirement  would  be  costly  and  unnecessary  given  their  compliance  with  the  existing  rules. 


 89.  The  FTC  concluded  that  its  company-  specific  do-  not-  call  rules  should  be  retained  despite  the  adoption  of  a  national  registry.  284  Although  the  FTC  found  that  the  company-  specific 
 list  was  often  ineffective  in  protecting  consumers,  the  FTC  concluded  it  will  work  in  a  complementary  fashion  with  a  national  do-  not-  call  list  to  effectuate  the  appropriate  balance 
 between  consumer  privacy  and  enabling  sellers  to  have  access  to  customers.  While  the  FTC  has  decided  to  exempt  telemarketing  calls  on  behalf  of  charitable  organizations  from  the  national 
 registry,  it  concluded  that  calls  by  for-  profit  telemarketers  on  behalf  of  charitable  organizations  will  now  be  subject  to  the  company-  specific  rules.  285 


 B.  Discussion 
 1.  Efficacy  of  the  Company-  Specific  Rules 
 90.  We  conclude  that  retention  of  the  company-  specific  do-  not-  call  rules  will  complement  the  national  do-  not-  call  registry  by  providing  consumers  with  an  additional  option 


 for  managing  telemarketing  calls.  We  believe  that  providing  consumers  with  the  ability  to  tailor  their  requests  not  to  be  called,  either  on  a  case-  by-  case  basis  under  the  company  do-  not-  call 
 approach  or  more  broadly  under  the  national  registry,  will  best  balance  individual  privacy  rights  and  legitimate  telemarketing  practices.  As  a  result,  those  consumers  that  wish  to  prohibit 


 280  Thomas  M.  Pechnik  Comments  at  2;  Wayne  Strang  Comments  at  4. 
 281  See  Telecommunications  for  the  Deaf  Comments  at  2. 
 282  See,  e.  g.,  ATA  Comments  at  97-  100;  DMA  Comments  at  16-  18;  SBC  Reply  Comments  at  6. 
 283  See,  e.  g,  Household  Financial  Comments  at  3;  MBA  Comments  at  6-  7;  Nextel  Comments  at  7-  9;  Qwest 
 Comments  at  6-  7.  But  see  MBNA  Comments  at  7. 
 284  FTC  Order,  68  Fed.  Reg.  at  4629. 


 285  FTC  Order,  67  Fed.  Reg.  at  4629. 
53

 Federal  Communications  Commission  FCC  03-  153 
 54 
 telephone  solicitations  from  only  certain  marketers  will  continue  to  have  the  option  to  do  so.  In  addition,  consumers  registered  on  the  national  do-  not-  call  registry  will  have  the  opportunity  to 
 request  that  they  not  be  called  by  entities  that  would  otherwise  fall  within  the  established  business  relationship  exemption  by  using  the  option  to  be  placed  on  the  company-  specific  lists. 
 This  finding  is  consistent  with  that  of  the  FTC. 
 91.  As  discussed  above,  we  agree  with  those  commenters  that  contend  that  the  company-  specific  do-  not-  call  approach  has  not  proven  ideal  as  a  stand-  alone  method  to  protect 


 consumer  privacy.  In  particular,  the  increase  in  telemarketing  calls  over  the  last  decade  now  places  an  extraordinary  burden  on  consumers  that  do  not  wish  to  receive  telephone  solicitations. 
 These  consumers  must  respond  on  a  case-  by-  case  basis  to  request  that  they  not  be  called.  The  record  in  this  proceeding  is  replete  with  examples  of  consumers  that  receive  numerous  unwanted 
 telemarketing  calls  each  day.  286  In  addition,  the  widespread  use  of  predictive  dialers  now  results  in  many  dead  air  or  hang-  up  calls  in  which  consumers  do  not  even  have  the  opportunity  to 
 make  a  do-  not-  call  request.  Such  calls  are  particularly  burdensome  for  the  elderly  and  disabled  consumers.  We  believe,  however,  that  the  measures  adopted  elsewhere  in  this  order  will 
 enhance  the  effectiveness  of  the  company-  specific  list.  For  example,  the  adoption  of  a  national  do-  not-  call  registry  alleviates  the  concerns  of  those  consumers,  including  elderly  and  disabled 
 consumers  that  may  find  a  case-  by-  case  do-  not-  call  option  particularly  burdensome.  In  addition,  restrictions  on  abandoned  calls  will  reduce  the  number  of  dead  air  calls.  Caller  ID 
 requirements  will  improve  the  ability  of  consumers  to  identify  and  enforce  do-  not-  call  rights  against  telemarketers.  We  also  note  that  although  many  commenters  question  the  effectiveness  of 
 the  company-  specific  approach,  there  is  little  support  in  the  record  to  eliminate  those  rules  based  on  the  adoption  of  the  national  do-  not-  call  list.  287  For  the  reasons  stated  above,  we  retain  the 
 option  for  consumers  to  request  on  a  case-  by-  case  basis  whether  they  desire  to  receive  telephone  solicitations. 


 2.  Amendments  to  the  Company-  Specific  Rules 
 92.  We  agree  with  several  industry  commenters  that  the  retention  period  for  records  of  those  consumers  requesting  not  to  be  called  should  be  reduced  from  the  current  ten-  year 


 requirement  to  five  years.  288  As  many  commenters  note,  telephone  numbers  change  hands  over  time  and  a  shorter  retention  period  will  help  ensure  that  only  those  consumers  who  have 
 requested  not  to  be  called  are  retained  on  the  list.  289  Both  telemarketers  and  consumers  will  benefit  from  a  list  that  more  accurately  reflects  those  consumers  who  have  requested  not  to  be 
 called.  The  FTC  has  concluded  and  several  commenters  in  this  proceeding  agree  that  five  years 


 286  See,  e.  g.,  Nancy  J.  Barginear  Comments;  David  K.  McClain  Comments;  John  A.  Rinderle  Comments;  Ryan 
 Tobin  Comments. 
 287  But  see  Nextel  Comments  at  7  (contending  that  adoption  of  a  national  do-  not-  call  list  may  render  unnecessary 
 any  detailed  company-  specific  requirements). 
 288  See,  e.  g.,  DMA  Comments  at  16;  Electronic  Retailing  Association  Comments  at  5-  6;  Ohio  PUC  Comments  at 
 17. 
 289  See,  e.  g.,  ABA  Comments  at  8;  AGF  Comments  at  3;  Call  Compliance  Comments  at  7. 
54

 Federal  Communications  Commission  FCC  03-  153 
 55 
 is  a  more  reasonable  period  to  retain  consumer  do-  not-  call  requests.  290  We  believe  a  five-  year  retention  period  reasonably  balances  any  administrative  burden  imposed  on  consumers  in 
 requesting  not  to  be  called  with  the  interests  of  telemarketers  in  contacting  consumers.  As  noted,  a  shorter  retention  period  increases  the  accuracy  of  the  database  while  the  national  do-  not-  call 
 option  mitigates  the  burden  on  those  consumers  who  may  believe  more  frequent  company-specific  do-  not-  call  requests  are  overly  burdensome.  We  believe  any  shorter  retention  period,  as 
 suggested  by  a  few  industry  commenters,  would  unduly  increase  the  burdens  on  consumers  who  would  be  forced  to  make  more  frequent  renewals  of  their  company-  specific  do-  not-  call  requests 
 without  substantially  improving  the  accuracy  of  the  database.  We  therefore  amend  our  rules  to  require  that  a  do-  not-  call  request  be  honored  for  five  years  from  the  time  the  request  is  made.  291 


 93.  We  decline  at  this  time  to  require  telemarketers  to  make  available  a  toll-  free  number  or  website  that  would  allow  consumers  to  register  company-  specific  do-  not-  call  requests 
 or  verify  that  such  a  request  was  made  with  the  marketer.  We  also  decline  to  require  telemarketers  to  provide  a  means  of  confirmation  so  that  consumers  may  verify  their  requests 
 have  been  processed  at  a  later  date.  Telemarketers  should,  however,  confirm  that  any  such  request  will  be  recorded  at  the  time  the  request  is  made  by  the  consumer.  In  addition,  consumers 
 calling  to  register  do-  not-  call  requests  in  response  to  prerecorded  messages  should  be  processed  in  a  timely  manner  without  being  placed  on  hold  for  unreasonable  periods  of  time.  Although  we 
 believe  the  additional  measures  discussed  above  would  improve  the  ability  of  consumers,  including  consumers  with  disabilities,  to  register  do-  not-  call  requests,  we  agree  with  those 
 commenters  that  contend  that  such  requirements  would  be  unduly  costly  to  businesses.  292  In  particular,  we  are  concerned  with  the  costs  imposed  on  small  businesses.  The  Commission  will, 
 however,  continue  to  monitor  compliance  with  our  company-  specific  do-  not-  call  rules  and  take  further  action  as  necessary. 


 94.  We  conclude  that  telemarketers  must  honor  a  company-  specific  do-  not-  call  request  within  a  reasonable  time  of  such  request.  We  disagree,  however,  with  commenters  that 
 suggest  that  periods  of  up  to  90  days  are  a  reasonable  time  required  to  process  do-  not-  call  requests.  293  Although  some  administrative  time  may  be  necessary  to  process  such  requests,  this 
 process  is  now  largely  automated.  294  As  a  result,  such  requests  can  often  be  honored  within  a  few  days  or  weeks.  Taking  into  consideration  both  the  large  databases  of  such  requests 
 maintained  by  some  entities  and  the  limitations  on  certain  small  businesses,  we  conclude  that  a  reasonable  time  to  honor  such  requests  must  not  exceed  thirty  days  from  the  date  such  a  request 


 290  See,  e.  g.,  DMA  Comments  at  16;  Electronic  Retailing  Association  Comments  at  5-  6;  Ohio  PUC  Comments  at 
 17-  18. 
 291  See  amended  rule  at  47  C.  F.  R.    64.1200(  d)(  6). 


 292  See,  e.  g.,  MBA  Comments  at  6;  Nextel  Comments  at  7-  9;  Qwest  Comments  at  6-  7. 
 293  See,  e.  g.,  Household  Financial  Services  Comments  at  3-  4  (contending  that  it  takes  90  days  to  process  requests); 
 Verizon  Comments  at  6  (45  days  to  process  request). 
 294  See,  e.  g.,  WorldCom  Comments  at  40. 
55

 Federal  Communications  Commission  FCC  03-  153 
 56 
 is  made.  295  We  note  that  the  Commissions  rules  require  that  entities  must  record  company-specific  do-  not-  call  requests  and  place  the  subscribers  telephone  number  on  the  do-  not-  call  list 
 at  the  time  the  request  is  made.  296  Therefore,  telemarketers  with  the  capability  to  honor  such  company-  specific  do-  not-  call  requests  in  less  than  thirty  days  must  do  so.  297  We  believe  this 
 determination  adequately  balances  the  privacy  interests  of  those  consumers  that  have  requested  not  to  be  called  with  the  interests  of  the  telemarketing  industry.  Consumers  expect  their  requests 
 not  to  be  called  to  be  honored  in  a  timely  manner,  and  thirty  days  should  be  the  maximum  administrative  time  necessary  for  telemarketers  to  process  that  request. 


 95.  In  addition,  we  decline  to  extend  the  company-  specific  do-  not-  call  rules  to  entities  that  solicit  contributions  on  behalf  of  tax-  exempt  nonprofit  organizations.  The  TCPA  excludes 
 calls  or  messages  by  tax-  exempt  nonprofit  organizations  from  the  definition  of  telephone  solicitation.  298  The  Commission  has  clarified  that  telemarketers  who  solicit  on  behalf  of  tax-exempt 
 nonprofit  organizations  are  not  subject  to  the  rules  governing  telephone  solicitations.  299  In  the  2002  Notice,  the  Commission  declined  to  seek  further  comment  on  this  issue.  300  We 
 acknowledge  that  this  determination  creates  an  inconsistency  with  the  FTCs  conclusion  to  extend  its  company-  specific  requirements  to  entities  that  solicit  contributions  on  behalf  of  tax-exempt 
 nonprofit  organizations.  The  Commission,  however,  derives  its  authority  to  regulate  telemarketing  from  the  TCPA.  As  noted  above,  that  statute  excludes  tax-  exempt  nonprofit 
 organizations  from  the  definition  of  telephone  solicitation.  We  therefore  decline  to  extend  the  company-  specific  requirements  to  entities  that  solicit  on  behalf  of  tax-  exempt  nonprofit 
 organizations.  We  note  that  some  tax-  exempt  nonprofit  organizations  have  determined  to  honor  voluntarily  specific  do-  not-  call  requests.  Other  organizations  may  find  it  advantageous  to  follow 
 this  example. 
 96.  Finally,  to  make  clear  our  determination  that  a  company  must  cease  making  telemarketing  calls  to  a  customer  with  whom  it  has  an  established  business  relationship  when 


 that  customer  makes  a  do-  not-  call  request,  we  amend  the  company-  specific  do-  not-  call  rules  to 


 295  Consistent  with  our  existing  rules,  such  request  applies  to  all  telemarketing  campaigns  of  the  seller  and  any 
 affiliated  entities  that  the  consumer  reasonably  would  expect  to  be  included  given  the  identification  of  the  caller  and  the  product  being  advertised.  47  C.  F.  R.    64.1200(  e)(  2)(  v).  See  also  AGF  Comments  at  4  (indicating  that  a 


 reasonable  time  to  process  requests  is  30  days);  MBNA  Comments  at  7  (reasonable  time  to  process  requests  is  a  minimum  of  30  days). 


 296  47  C.  F.  R.    64.1200(  e)(  2)(  iii). 
 297  As  noted  above,  the  safe  harbor  period  for  compliance  with  the  national  do-  not-  call  list  is  three-  months. 
 However,  given  that  the  national  list  will  contain  many  more  registrants  than  the  individual  company-  specific  lists,  we  believe  that  it  is  reasonable  to  allow  some  additional  time  for  telemarketers  to  comply  with  the  national  do-  not-call 


 requests. 
 298  See  47  U.  S.  C.    227(  a)(  3)(  C). 


 299  1995  TCPA  Reconsideration  Order,  10  FCC  Rcd  at  12397,  para.  13. 
 300  2002  Notice,  17  FCC  Rcd  at  17479,  para.  33. 
56

 Federal  Communications  Commission  FCC  03-  153 
 57 
 apply  to  any  call  for  telemarketing  purposes.  301  We  also  adopt  a  provision  stating  that  a  consumers  do-  not-  call  request  terminates  the  established  business  relationship  for  purposes  of 
 telemarketing  calls  even  if  the  consumer  continues  to  do  business  with  the  seller.  302 


 V.  INTERPLAY  OF  SECTIONS  222  AND  227 
 A.  Background 
 97.  In  the  2002  Notice,  the  Commission  sought  comment  generally  on  the  interplay  between  sections  222  and  227.  303  Section  222,  entitled  Privacy  of  Consumer  Information, 


 obligates  telecommunications  carriers  to  protect  the  confidentiality  of  certain  information  and  to  protect  the  customer  proprietary  network  information  (CPNI)  created  by  the  customer-  carrier 
 relationship.  304  Under  the  CPNI  rules,  a  customer  may  allow  her  carrier  to  use  her  CPNI  for  marketing  purposes.  Depending  on  the  uses  the  carrier  intends  to  make  of  the  customers  CPNI, 
 the  carrier  must  provide  the  customer  notice  of  her  CPNI  rights  and  a  means  to  effectuate  her  CPNI  choice    either  opt-  in  or  opt-  out  consent.  305  The  TCPA,  on  the  other  hand,  governs  a 


 301  See  amended  rule  at  47  C.  F.  R.    64.1200(  d). 
 302  See  amended  rule  at  47  C.  F.  R.    64.1200(  f)(  3)(  i). 
 303  2002  Notice,  17  FCC  Rcd  at  17471-  72,  paras.  18-  19. 
 304  The  Act  defines  CPNI  as  (  A)  information  that  relates  to  the  quantity,  technical  configuration,  type, 
 destination,  location,  and  amount  of  use  of  a  telecommunications  service  subscribed  to  by  any  customer  of  a  telecommunications  carrier,  and  that  is  made  available  to  the  carrier  by  the  customer  solely  by  virtue  of  the 


 carrier-  customer  relationship;  and  (B)  information  contained  in  the  bills  pertaining  to  telephone  exchange  service  or  telephone  toll  service  received  by  a  customer  of  a  carrier.  47  U.  S.  C.    222(  h)(  1)(  A)  and  (B)  (the  911  Act 
 amended  the  definition  of  CPNI  in  section  222(  h)  to  include  location  among  a  customers  information  that  carriers  are  required  to  protect  under  the  privacy  provisions  of  section  222).  CPNI  includes  personal  information 
 such  as  the  phone  numbers  called  by  a  consumer,  the  length  of  phone  calls,  and  services  purchased  by  a  consumer,  such  as  call  waiting.  See  Implementation  of  the  Telecommunications  Act  of  1996:  Telecommunications  Carriers 
 Use  of  Customer  Proprietary  Network  Information  and  Other  Customer  Information;  Implementation  of  the  Non-Accounting  Safeguards  of  Sections  271  and  272  of  the  Communications  Act  of  1934,  as  amended,  2000  Biennial 
 Regulatory  Review  -  Review  of  Policies  and  Rules  Concerning  Unauthorized  Changes  of  Consumers  Long  Distance  Carriers,  CC  Docket  Nos.  96-  115,  96-  149,  and  00-  257,  Third  Report  and  Order  and  Third  Further 
 Notice  of  Proposed  Rulemaking,  17  FCC  Rcd  14860  at  14864,  para.  7  (2002)  (CPNI  Third  Report  and  Order). 
 305  Opt-  out  approval  and  opt-  in  approval  refer  to  methods  of  obtaining  customer  consent  to  use,  disclose,  or  permit 
 access  to  customers  CPNI.  The  opt-  in  approval  method  requires  that  the  carrier  obtain  from  the  customer  affirmative,  express  consent  allowing  the  requested  CPNI  usage,  disclosure,  or  access  after  the  customer  is 


 provided  appropriate  notification  of  the  carriers  request  consistent  with  the  requirements  adopted  by  the  Commission.  47  C.  F.  R.    64.2003(  h).  Under  the  opt-  out  approval  method  a  customer  is  deemed  to  have 
 consented  to  the  use,  disclosure,  or  access  to  the  customers  CPNI  if  the  customer  has  failed  to  object  thereto  within  the  waiting  period  [adopted  by  the  Commission  in  47  C.  F.  R.    64.2009(  d)(  1)]  after  the  customer  is 
 (continued.) 
57

 Federal  Communications  Commission  FCC  03-  153 
 58 
 particular  method    telemarketing    by  which  carriers  (and  other  companies)  market  to  their  customers,  and  those  customers  rights  to  choose  whether  or  not  they  wish  to  receive  such 
 telemarketing  calls.  Accordingly,  a  consumers  decision  to  allow  her  carrier  to  use  her  CPNI  reflects  whether  she  is  willing  to  have  her  carrier  look  at  her  personal  usage  information  in  order 
 to  tailor  its  marketing  306  based  on  her  usage  patterns.  A  consumers  decision  to  enroll  on  the  national  do-  not-  call  list  reflects  her  decision  about  whether  she  wishes  to  receive  telemarketing 
 calls. 
 98.  In  the  2002  Notice,  the  Commission  tentatively  concluded  that  a  customers  request  to  be  placed  on  a  telecommunications  carriers  do-  not-  call  list  limits  that  carriers  ability 


 to  market  to  that  consumer  via  telephone.  307  The  Commission  reasoned  that  [  h]  onoring  a  do  not  call  request  under  section  227  does  not  render  a  consent  under  section  222  a  nullity,  but  instead 
 merely  limits  the  manner  of  contact  (i.  e.,  marketing  over  the  telephone)  consistent  with  the  express  request  of  the  customer  under  section  227.  308  Numerous  commenters  generally 
 supported  the  Commissions  tentative  determination  that  a  customers  section  222  approval  to  use  his  or  her  CPNI  should  not  override  that  customers  request  to  be  placed  on  a  do-  not-  call 
 list.  309  However,  some  commenters  urged  the  Commission  to  draw  distinctions  based  on:  (1)  the  type  of  CPNI  consent  received  (opt-  in  versus  opt-  out);  and/  or  (2)  national  and  state  do-  not-  call 
 lists  versus  company-  specific  do-  not-  call  lists. 
 99.  In  particular,  some  commenters  argued  that  a  customers  CPNI  approval  should  be  deemed  to  override  her  request  to  be  included  on  a  national  (or  other  general)  do-  not-  call  list, 


 but  should  not  override  a  request  to  be  placed  on  a  company-  specific  do-  not-  call  list.  310  Additionally,  some  commenters  supported  an  approach  where  a  customers  CPNI  approval,  if 
 obtained  through  an  opt-  out  mechanism,  would  not  overcome  the  customers  request  to  be  placed  on  a  do-  not-  call  list;  however,  opt-  in  CPNI  approval  would  be  deemed  to  overcome  a  customers 
 inclusion  on  a  do-  not-  call  list.  311  A  few  commenters  argued  that  any  CPNI  approval  should  be  deemed  to  overcome  a  customers  inclusion  on  a  do-  not-  call  registry.  312  Finally,  one  commenter 


 (Continued  from  previous  page)  provided  appropriate  notification  of  the  carriers  request  for  consent  consistent  with  the  rules  adopted  by  the 
 Commission.  47  C.  F.  R.    64.2003(  i). 
 306  Such  marketing  is  not  limited  to  telemarketing  and  may  include  direct  mail  or  other  marketing. 


 307  2002  Notice,  17  FCC  Rcd  at  17471-  72,  para.  19.  The  Commission  noted  that  the  carrier  would  still  be  able  to 
 market  to  that  consumer  in  other  ways  (e.  g.,  direct  mail,  e-  mail,  etc.).  Id. 
 308  2002  Notice,  17  FCC  Rcd  at  17471-  72,  para.  19. 


 309  BellSouth  Comments  at  6;  Verizon  Comments  at  16;  Michael  C.  Worsham  Comments  at  3;  Yellow  Pages 
 Comments  at  6. 
 310  Cingular  Comments  at  10;  Sprint  Comments  at  15. 


 311  AT&  T  Wireless  Comments  at  20-  21. 
 312  Concerned  Telephone  Companies  Comments  at  1-  8;  NTCA  Comments  at  2  (  Offering  opt-  out  consent  to  the 
 consumers  telecommunications  carrier  under  section  222  indicates  an  interest  in  receiving  information  on  new  services  that  may  be  available  either  now  or  in  the  future  from  the  carrier.). 
58

 Federal  Communications  Commission  FCC  03-  153 
 59 
 suggested  that  the  question  of  the  interplay  between  a  customers  opt-  in  consent  to  use  her  CPNI  and  request  to  be  on  a  do-  not-  call  list  should  be  judged  on  a  customer-  by-  customer  basis,  based 
 on  which  request  was  made  most  recently.  313 
 B.  Discussion 
 100.  We  first  note  that  the  fact  that  a  telecommunications  carrier  has  current  CPNI  about  a  particular  consumer  indicates  that  the  consumer  is  a  customer  of  that  carrier.  In  that 


 situation,  there  exists  an  established  business  relationship  between  the  customer  and  the  carrier.  314  The  established  business  relationship  is  an  exception  to  the  national  do-  not-  call 
 registry.  315  However,  based  on  the  evidence  in  the  record  and  as  supported  by  numerous  commenters,  316  we  confirm  our  tentative  conclusion  that  if  a  customer  places  her  name  on  a 
 carriers  do-  not-  call  list,  that  request  must  be  honored  even  though  the  customer  may  also  have  provided  consent  to  use  her  CPNI  under  section  222.  317  By  doing  so,  we  maximize  the 
 protections  and  choices  available  to  consumers,  while  giving  maximum  effect  to  the  language  of  both  statutes.  At  the  outset,  the  average  consumer  seems  rather  unlikely  to  appreciate  the 
 interrelationship  of  the  Commissions  CPNI  and  do-  not-  call  rules.  Allowing  CPNI  consent  to  trump  a  do-  not-  call  request  would,  therefore,  thwart  most  consumers  reasonable  expectations 
 about  how  a  company-  specific  do-  not-  call  list  functions.  Equally  important,  permitting  a  consumers  CPNI  consent  to  supercede  a  consumers  express  do-  not  call  request  might 
 undermine  the  carriers  do-  not-  call  database  as  the  first  source  of  information  about  the  consumers  telemarketing  preferences. 


 101.  As  discussed  infra,  because  we  retain  the  exemption  for  calls  and  messages  to  customers  with  whom  the  carrier  has  an  established  business  relationship,  318  the  determination 
 that  a  customers  CPNI  approval  does  not  trump  her  inclusion  on  a  do-  not-  call  list  should  have  no  impact  on  carriers  ability  to  communicate  with  their  customers  via  telemarketing.  319  Carriers 


 313  NYSCPB  Comments  at  5. 
 314  See  47  C.  F.  R.    64.1200(  f)(  4).  See  also  infra  Section  VI. 
 315  See  supra  para.  42. 
 316  BellSouth  Comments  at  6;  Michael  C.  Worsham  Comments  at  3;  Verizon  Comments  at  16;  Yellow  Pages 
 Comments  at  6. 
 317  As  one  commenter  stated  under  the  Commissions  CPNI  rules    a  customers  CPNI  consent  does  not  equate 
 to  customer  consent  to  receive  telemarketing  by  that  carrier.  AT&  T  Wireless  Comments  at  19. 
 318  See  infra  para.  112. 


 319  We  disagree  with  the  Concerned  Telephone  Companies  assertion  that  a  customers  CPNI  consent  equates  to  a 
 prior  express  invitation  or  permission  to  be  contacted.  See  Concerned  Telephone  Companies  Comments  at  2.  As  we  discuss  herein,  a  customers  CPNI  consent  indicates  her  willingness  to  have  her  telephone  company  use  her 


 CPNI  in  order  to,  among  other  things,  tailor  marketing  proposals  to  her.  CPNI  approval,  however,  is  not  a  blanket  approval  for  any  and  all  marketing  a  carrier  may  decide  to  pursue.  A  customers  affirmative  decision  to  enroll  on 
 a  do-  not-  call  list  is  a  much  more  direct  and  reliable  indicator  of  a  customers  willingness  to  receive  marketing  advances  via  the  telephone.  Accordingly,  we  disagree  with  the  Concerned  Telephone  Companies  assertion  that 
 (continued.) 
59

 Federal  Communications  Commission  FCC  03-  153 
 60 
 will  be  able  to  contact  customers  with  whom  they  have  an  established  business  relationship  via  the  telephone,  unless  the  customer  has  placed  her  name  on  the  companys  do-  not-  call  list; 
 whether  the  customer  has  consented  to  the  use  of  her  CPNI  does  not  impact  the  carriers  ability  to  contact  the  customer  via  telemarketing.  320 


 102.  We  are  not  persuaded  by  the  arguments  of  those  commenters  who  urge  the  Commission  to  find  that  CPNI  consent  should  trump  a  customers  request  to  be  placed  on  a  do-not- 
 call  list  or  similarly,  that  CPNI  consent  equates  to  permission  to  market  without  restriction.  321  We  note  that  the  Concerned  Telephone  Companies  assert  that  CPNI  consent 
 equates  to  consent  to  market  without  restriction  based  on  [customers]  CPNI.  322  The  Commission  finds  no  support  for  this  assertion  in  any  Commission  order  or  statutory  provision 
 and,  as  we  discuss  herein,  we  specifically  determine  that  CPNI  approval  does  not  equate  to  unlimited  consent  to  market  without  restriction. 


 103.  Similarly,  a  number  of  commenters  argue  that  a  customers  CPNI  authorization  covers  a  number  of  forms  of  marketing,  including  telemarketing.  323  However,  such  assertions 
 ignore  the  plain  fact  that  CPNI  approval  deals  specifically  with  a  carriers  use  of  a  customers  personal  information,  and  only  indirectly  pertains  to  or  arguably  authorizes  marketing  to  the 
 customer.  Do-  not-  call  lists,  on  the  other  hand,  speak  directly  to  customers  preferences  regarding  telemarketing  contacts.  324  Accordingly,  we  are  convinced  that  a  customers  do-  not-call 
 request  demonstrates  more  directly  her  willingness  (or  lack  thereof)  to  receive  telemarketing  calls,  as  opposed  to  any  indirect  inference  that  can  be  drawn  from  her  CPNI  approval. 


 104.  Additionally,  we  disagree  with  those  commenters  who  claim  that  allowing  CPNI  approval  to  trump  a  consumers  request  to  be  on  a  national  or  state  do-  not-  call  list  gives 
 (Continued  from  previous  page)  consent  given  by  a  customer  under  the  CPNI  rules  renders  Section  227  constraints  inapplicable.  Concerned 
 Telephone  Companies  Comments  at  2. 
 320  Some  commenters  equated  obtaining  customers  consent  to  use  the  customers  CPNI  with  having  an 
 established  business  relationship.  See  Nextel  Comments  at  16,  section  entitled  The  Commission  Should  Interpret  the  Established  Business  Relationship  Rules  in  a  Manner  Consistent  With  the  Consent  Requirements  of  the  CPNI 


 Rules.  We  concur  with  those  commenters  who  argue  that  the  carriers  established  business  relationship  allows  the  carrier  to  contact  those  customers  via  telemarketing  who  have  requested  to  be  on  the  national  do-  not-  call  list. 
 However,  as  we  determine  herein,  the  CPNI  consent  does  not  overcome  or  trump  a  customers  request  to  be  included  on  the  national  do-  not-  call  list.  See  Cingular  Comments  at  10;  Nextel  Comments  at  17;  Sprint  Comments 
 at  16  (  The  view  that  telecommunications  service  providers  should  be  allowed  to  contact  their  existing  customers,  even  if  such  customers  have  asked  to  be  placed  on  a  general  (non-  company  specific)  DNC  list,  is  consistent  with 
 the  Commissions  view  of  the  importance  of  established  business  relationships.  ). 
 321  Concerned  Telephone  Companies  Comments  at  2;  AT&  T  Wireless  Reply  Comments  at  26. 


 322  Concerned  Telephone  Companies  Comments  at  2  (emphasis  added). 
 323  AT&  T  Wireless  Reply  Comments  at  26-  27. 
 324  Yellow  Pages  Comments  at  7  (  Consumers  who  do  not  want  to  receive  solicitations  via  telephone  are  going  to 
 request  to  be  placed  on  the  do-  not-  call  list,  regardless  of  whether  the  consumer  has  consented  to  the  use  of  their  CPNI). 
60

 Federal  Communications  Commission  FCC  03-  153 
 61 
 consumers  greater  flexibility.  325  As  stated  above,  a  carriers  established  business  relationship  with  a  customer  exempts  the  carrier  from  honoring  the  customers  national  do-  not-  call  request. 
 However,  as  stated  above,  CPNI  consent  is  not  deemed  to  trump  a  carrier-  specific  do-  not-  call  list  request.  For  similar  reasons,  we  decline  to  make  a  distinction  based  on  what  type  of  CPNI 
 consent  (opt-  in  versus  opt-  out)  received,  as  some  commenters  urge.  326 
 105.  We  do  not  allow  carriers  to  combine  the  express  written  consent  to  allow  them  to  contact  customers  on  a  do-  not-  call  list  with  the  CPNI  notice  in  the  manner  that  AT&  T  Wireless 


 describes.  However,  we  do  allow  carriers  to  combine  in  the  same  document  CPNI  notice  with  a  request  for  express  written  consent  to  call  customers  on  a  do-  not-  call  list,  provided  that  such 
 notices  and  opportunities  for  consumer  consent  are  separate  and  distinct.  That  is,  consumers  must  have  distinct  choices  regarding  both  whether  to  allow  use  of  their  CPNI  and  whether  to 
 allow  calls  after  registering  a  do-  not-  call  request,  but  carriers  may  combine  those  requests  for  approval  in  the  same  notice  document.  Finally,  we  find  a  distinction  based  on  the  type  of  CPNI 
 consent  unnecessary  here,  as  carriers  can  avail  themselves  of  the  established  business  relationship  exception  to  contact  their  existing  customers,  irrespective  of  the  type  of  CPNI 
 consent  obtained. 
 106.  Similarly,  we  agree  with  those  commenters  327  who  advise  against  using  a  time  element  to  determine  whether  a  customers  do-  not-  call  request  takes  precedence  over  the 


 customers  opt-  in  approval  to  use  her  CPNI,  328  because  adding  a  time  element  would  unnecessarily  complicate  carrier  compliance  and  allow  carriers  to  game  the  system.  In 
 particular,  the  New  York  State  Consumer  Protection  Board  argues  that  enrollment  on  a  national  do-  not-  call  list  should  take  precedence  over  the  prior  implied  consent  through  the  opt-  out 
 procedure,  but  that  the  latest  in  time  should  prevail  regarding  opt-  in  consents.  329  Because  we  determine  that  carriers  can  contact  consumers  with  whom  they  have  established  business 
 relationships,  irrespective  of  those  consumers  CPNI  preferences,  we  find  this  proposed  methodology  unnecessary  in  determining  whether  a  customers  CPNI  consent  should  trump  her 
 do-  not-  call  request.  Additionally,  we  note  that  this  proposal  could  be  manipulated  by  carriers  to  overcome  consumers  do-  not-  call  preferences,  by  allowing  carriers  to  send  CPNI  notices  to 
 customers  that  are  intentionally  timed  to  overcome  previously  expressed  do-  not-  call  requests. 
 107.  Finally,  although  it  was  not  directly  raised  in  the  2002  Notice,  some  commenters  raised  the  issue  of  whether  any  type  of  do-  not-  call  request  revokes  or  limits  a  carriers  ability  to 


 325  AT&  T  Wireless  Reply  Comments  at  27. 
 326  AT&  T  Wireless  Comments  at  18-  19  (contending  that  under  circumstances  where  the  express  opt-  in  CPNI 
 consent  includes  customer  consent  to  be  contacted  by  telephone,  AWS  believes  the  carrier  has  the  permission  to  contact  the  customer  even  if  that  customer  has  placed  her  name  on  either  the  carriers  or  a  national  do-  not-  call 


 list.).  See  also  NYSCPB  Comments  at  5. 
 327  AT&  T  Wireless  Reply  Comments  at  27. 


 328  NYSCPB  Comments  at  5. 
 329  NYSCPB  Comments  at  5. 
61

 Federal  Communications  Commission  FCC  03-  153 
 62 
 use  CPNI  in  a  manner  other  than  telemarketing.  330  To  the  degree  such  affirmation  is  necessary,  we  agree  with  those  commenters  who  maintain  that  a  carriers  ability  to  use  CPNI  is  not 
 impacted  by  a  customers  inclusion  on  a  do-  not-  call  list,  except  as  noted  above. 
 108.  Constitutional  Implications.  We  disagree  with  those  commenters  who  argue  that  our  decision  that  a  customers  CPNI  approval  does  not  trump  her  request  to  be  on  a  do-  not-  call 


 list  violates  the  First  Amendment  rights  of  carriers  and  customers.  331  Commenters  cite  no  authority  to  support  their  arguments,  and  we  do  not  believe  the  fact  that  customers  have  given 
 their  approval  for  carriers  to  use  their  CPNI  implicates  any  additional  First  Amendment  issues  beyond  those  discussed  in  Section  III.  B.  4.,  supra.  Accordingly,  we  find  our  rules  implementing 
 the  do-  not-  call  registry  are  consistent  with  the  First  Amendment  as  applied  to  any  consumer,  including  those  who  have  previously  given  their  approval  to  carriers  to  use  their  CPNI,  pursuant 
 to  section  222.  Furthermore,  we  believe  that  the  exception  which  allows  carriers  to  call  consumers  with  whom  they  necessarily  have  an  established  business  relationship  renders 
 commenters  arguments  moot,  as  carriers  necessarily  have  an  established  business  relationship  with  any  customer  from  whom  they  solicit  CPNI  approval. 


 VI.  ESTABLISHED  BUSINESS  RELATIONSHIP 
 A.  Background 
 109.  The  TCPA  provides  that  the  term  telephone  solicitation  does  not  include  a  call  or  message  to  any  person  with  whom  the  caller  has  an  established  business  relationship  (or 


 EBR).  332  The  Commission  determined  during  its  initial  TCPA  rulemaking  that,  based  on  the  record  and  legislative  history,  the  TCPA  also  permits  an  established  business  relationship 
 exemption  from  the  restrictions  on  artificial  or  prerecorded  message  calls  to  residences.  333  In  the  2002  Notice,  we  sought  comment  on  the  exemption  generally,  and  more  specifically,  on  the 
 definition  of  established  business  relationship,  and  whether  any  circumstances  have  developed  that  would  justify  revisiting  these  conclusions.  334  The  current  rules  define  the  term  established 
 business  relationship  to  mean: 
 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 


 330  AT&  T  Wireless  Reply  Comments  at  26;  Verizon  Comments  at  16;  Yellow  Pages  Comments  at  6. 
 331  Concerned  Telephone  Companies  Comments  at  3. 
 332  47  U.  S.  C.    227(  a)(  3)(  B). 
 333  1992  TCPA  Order,  7  FCC  Rcd  at  8770,  para.  34;  see  also  47  C.  F.  R.    64.1200(  c)(  3). 
 334  2002  Notice,  17  FCC  Rcd  at  17480,  para.  34. 
62

 Federal  Communications  Commission  FCC  03-  153 
 63 
 either  party.  335 
 110.  Industry  commenters  overwhelmingly  support  retaining  the  exemption  for  calls  to  customers  with  whom  companies  have  an  established  business  relationship,  336  and  many  urge  the 


 Commission  not  to  narrow  the  scope  of  the  exemption.  337  Many  industry  members  are  also  opposed  to  any  time  limitation  on  the  exemption,  338  or  any  modification  of  the  rules  that  would 
 interfere  with  a  companys  ability  to  market  different  services  and  products.  339  Most  consumer  groups  and  state  organizations  support  the  exemption,  provided  the  scope  of  the  definition  is 
 narrowed.  340  A  few  consumers  advocated  eliminating  the  exemption  for  prerecorded  messages.  341  Some  consumer  advocates  disagreed  with  the  assumption  that  consumers  want  to 
 hear  from  companies  with  whom  they  have  an  existing  relationship.  One  commenter  stated  that  because  a  consumer  might  have  established  a  relationship  with  a  company  does  not  necessarily 
 mean  that  he  or  she  wishes  to  receive  telemarketing  calls  from  that  company.  342  Many  consumers  groups  argued  that  the  relationship  should  be  ongoing,  343  should  require  a  completed 


 335  47  C.  F.  R.    64.1200(  f)(  4). 
 336  See,  e.  g.,  MPA  Comments  at  5,  13;  MBNA  Comments  at  7;  NAII  Comments  at  3;  SBC  Comments  at  10; 
 Nextel  Comments  at  11-  13. 
 337  See,  e.  g.,  ATA  Comments  at  101-  105;  NADA  Comments  at  2. 


 338  See,  e.  g.,  SBC  Comments  at  12-  13;  Intuit  Comments  at  6;  DMA  Comments  at  20-  21;  ATA  Comments  at  105. 
 But  see,  e.  g.,  ERA  Comments  at  11  (definition  should  cover  24  month  period  prior  to  call);  AT&  T  Wireless  Reply  Comments  at  18-  19  (favoring  the  FTCs  18-  month  duration  on  the  established  business  relationship);  Scholastic 


 Comments  at  8  (3  years  following  payment  for  goods  and  6  months  following  an  inquiry);  MidFirst  Bank  Comments  at  2-  3  (suggesting  the  existing  business  relationship  be  terminated  no  earlier  than  a  period  of  12 
 months  following  the  last  purchase  and  no  earlier  than  60  days  following  the  closure  of  all  accounts  with  a  company). 


 339  See,  e.  g.,  HFS  Comments  at  6;  WorldCom  Comments  at  14-  16;  Comcast  Comments  at  5-  7;  American  Express 
 Comments  at  3-  4. 
 340  See,  e.  g.,  NASUCA  Comments  at  17;  John  A.  Shaw  Comments  at  4;  TOPUC  Comments  at  5;  NYSCPB 
 Comments  at  7-  8  (should  not  extend  to  related  business  entities);  Michael  C.  Worsham  Comments  at  10  (should  delete  inquiry,  application  from  definition,  as  they  do  not  constitute  permission  to  receive  prerecorded 


 messages);  PUC  of  Ohio  Comments  at  15  (should  be  limited  to  contact  about  changes  or  updates  to  current  product  or  service);  NYSCPB  Other  Than  DNC  List  Comments  at  7-  8,  14-  17  (should  not  extend  to  related 
 business  entities  or  include  a  mere  inquiry);  NCL  Comments  at  5  (explaining  that  under  the  current  definition  of  established  business  relationship,  consumers  have  to  remember  the  name  of  every  company  with  whom  they  have 
 ever  had  any  contact  in  order  to  determine  which  can  call  legally  and  which  cannot). 
 341  Thomas  M.  Pechnik  Comments  at  3  (no  authority  in  section  227  for  an  EBR  exemption  for  artificial  or 
 prerecorded  message  calls);  Wayne  G.  Strang  Comments  at  12  (should  revoke  EBR  exemption  for  prerecorded  messages). 


 342  See  AARP  Comments  at  6;  see  also  NCL  Comments  at  5  (urging  the  Commission  to  require  telemarketers  to 
 disclose  to  their  customers  that  they  plan  to  make  telemarketing  calls  and  to  provide  the  opportunity  for  them  to  opt-  out). 


 343  See,  e.  g.,  AARP  Comments  at  5;  NASUCA  Comments  at  17-  18. 
63

 Federal  Communications  Commission  FCC  03-  153 
 64 
 transaction,  such  as  a  purchase  or  payment,  344  and  should  be  limited  in  duration.  345  Of  commenters  who  advocated  a  specific  time  limit  on  the  EBR,  there  was  less  consensus  about 
 how  long  the  relationship  should  last  following  a  transaction  between  the  seller  and  consumer.  346 
 111.  The  FTC  decided  to  provide  an  exemption  for  established  business  relationships  from  the  national  do-  not-  call  registry,  as  long  as  the  consumer  has  not  asked  to 


 be  placed  on  the  sellers  company-  specific  do-  not-  call  list.  The  FTCs  amended  Rule  limits  the  established  business  relationship  exemption  to  relationships  formed  by  the  consumers 
 purchase,  rental  or  lease  of  goods  or  services  from,  or  financial  transaction  with,  the  seller  within  eighteen  (18)  months  of  the  telephone  call  or,  in  the  case  of  inquiries  or  applications,  to  three  (3) 
 months  from  the  inquiry  or  application.  347  The  FTC  explained  that  this  time  frame  is  consistent  with  most  state  laws  that  include  a  time  limit,  348  and  is  more  in  keeping  with  consumer 
 expectations  than  an  open-  ended  exemption.  349  The  FTC  also  determined  that  affiliates  will  fall  within  the  exemption  only  if  the  consumer  would  reasonably  expect  them  to  be  included  given 
 the  nature  and  type  of  goods  or  services  offered  and  the  identity  of  the  affiliate.  350 
 B.  Discussion 
 112.  We  conclude  that,  based  on  the  record,  an  established  business  relationship  exemption  is  necessary  to  allow  companies  to  communicate  with  their  existing  customers.  351 


 Companies  maintain  that  the  exemption  allows  them  to  make  new  offers  to  existing  customers, 


 344  AARP  Comments  at  5. 
 345  AARP  Comments  at  5. 
 346  Some  suggest  24  months  (MPA  Comments  at  12-  13  and  NASUCA  Comments  at  17);  others  advocate  a  36- 
 month  period  (Scholastic  Comments  at  8  and  Bank  of  America  Comments  at  4);  some  commenters  maintain  that  a  12-  month  period  would  be  sufficient  (Sprint  Comments  at  18);  other  commenters  advocated  a  definition 


 comparable  to  the  FTCs  (DIRECTV  Further  Comments  at  2;  NTCA  Further  Comments  at  2-  3).  See  also  TOPUC  Comments  at  6  (stating  that  Commission  rules  should  require  that  the  relationship  be  ongoing.  To  qualify  as 
 ongoing,  the  customers  must  have  completed  a  purchase  or  transaction  with  a  specific  company  within  24  months  prior  to  the  call). 


 347  FTC  Order,  68  Fed  Reg.  at  4634;  16  C.  F.  R.    310.2(  n). 
 348  FTC  Order,  68  Fed.  Reg.  at  4634. 
 349  FTC  Order,  68  Fed  Reg.  at  4592. 
 350  FTC  Order,  68  Fed.  Reg.  at  4593-  94. 
 351  The  established  business  relationship  permits  telemarketers  to  call  consumers  registered  on  the  national  do-not- 
 call  list  and  to  deliver  prerecorded  messages  to  consumers.  The  established  business  relationship,  however,  is  not  an  exception  to  the  company-  specific  do-  not-  call  rules.  Companies  that  call  their  EBR  customers  must 


 maintain  company-  specific  do-  not-  call  lists  and  record  any  do-  not-  call  requests  as  required  by  amended  47  C.  F.  R.    64.1200(  d).  See  infra  discussion  in  para.  124.  The  Commission  has  also  reversed  its  prior  conclusion  that  an 
 established  business  relationship  provides  the  necessary  permission  to  deliver  unsolicited  facsimile  advertisements.  See  infra  discussion  in  para.  188-  191. 
64

 Federal  Communications  Commission  FCC  03-  153 
 65 
 such  as  mortgage  refinancing,  insurance  updates,  and  subscription  renewals.  352  They  suggest  that  customers  benefit  from  calls  that  inform  them  in  a  timely  manner  of  new  products,  services 
 and  pricing  plans.  American  Express  contends  that  its  financial  advisors  have  a  fiduciary  duty  to  their  customers,  requiring  them  to  contact  customers  with  time-  sensitive  information.  353  We  are 
 persuaded  that  eliminating  this  EBR  exemption  would  possibly  interfere  with  these  types  of  business  relationships.  Moreover,  the  exemption  focuses  on  the  relationship  between  the  sender 
 of  the  message  and  the  consumer,  rather  than  on  the  content  of  the  message.  It  appears  that  consumers  have  come  to  expect  calls  from  companies  with  whom  they  have  such  a  relationship, 
 and  that,  under  certain  circumstances,  they  may  be  willing  to  accept  these  calls.  354  Finally,  we  believe  that  while  consumers  may  find  prerecorded  voice  messages  intrusive,  such  messages  do 
 not  necessarily  impose  the  same  costs  on  the  recipients  as,  for  example,  unsolicited  facsimile  messages.  355  Therefore,  we  retain  the  exemption  for  established  business  relationship  calls  from 
 the  ban  on  prerecorded  messages.  Telemarketers  that  claim  their  prerecorded  messages  are  delivered  pursuant  to  an  established  business  relationship  must  be  prepared  to  provide  clear  and 
 convincing  evidence  of  the  existence  of  such  a  relationship. 
 1.  Definition  of  Established  Business  Relationship 
 113.  We  conclude  that  the  Commissions  current  definition  of  established  business  relationship  should  be  revised.  We  are  convinced  that  consumers  are  confused  and  even 


 frustrated  more  often  when  they  receive  calls  from  companies  they  have  not  contacted  or  done  business  with  for  many  years.  The  legislative  history  suggests  that  it  was  Congresss  view  that 
 the  relationship  giving  a  company  the  right  to  call  becomes  more  tenuous  over  time.  356  In  addition,  we  believe  that  this  is  an  area  where  consistency  between  the  FCC  rules  and  FTC  rules 
 is  critical  for  both  consumers  and  telemarketers.  We  conclude  that,  based  on  the  range  of  suggested  time  periods  that  would  meet  the  needs  of  industry,  along  with  consumers  reasonable 
 expectations  of  who  may  call  them  and  when,  eighteen  (18)  months  strikes  an  appropriate  balance  between  industry  practices  and  consumers  privacy  interests.  Therefore,  the 
 Commission  has  modified  the  definition  of  established  business  relationship  to  mean: 


 352  See,  e.  g.,  ATA  Comments  at  105;  Verizon  Comments  at  13-  14. 
 353  American  Express  Comments  at  4. 
 354  See,  e.  g.,  Bank  of  America  Comments  at  3;  ATA  Comments  at  101. 
 355  See  infra  discussion  on  unsolicited  facsimile  messages,  paras.  185-  193. 
 356  See  H.  R.  REP.  NO.  102-  317  at  14  (1991)  (  In  the  Committees  view,  an  established  business  relationship  .  .  . 
 could  be  based  upon  any  prior  transaction,  negotiation,  or  inquiry  between  the  called  party  and  the  business  entity  that  has  occurred  during  a  reasonable  period  of  time.  .  .  The  Committee  recognized  this  relationship  so  as  not  to 


 foreclose  the  capacity  of  businesses  to  place  calls  that  build  upon,  follow  up,  or  renew,  within  a  reasonable  period  of  time,  what  had  once  been  [an]  existing  customer  relationship.  )  The  House  Report  also  states  that  .  .  .  the 
 Committee  believes  the  test  to  be  applied  must  be  grounded  in  the  consumers  expectation  of  receiving  the  call.  Consequently,  the  test  shall  consist  of  a  determination  of  whether  the  new  solicitation  occurs  within  a  reasonable 
 period  of  time  and  the  new  product  or  service  being  promoted  is  related  substantially  to  the  prior  relationship.  Id.  at  14-  15. 
65

 Federal  Communications  Commission  FCC  03-  153 
 66 
 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  the  subscribers  purchase  or  transaction  with  the  entity  within  the  eighteen 
 (18)  months  immediately  preceding  the  date  of  the  telephone  call  or  on  the  basis  of  the  subscribers  inquiry  or  application  regarding  products 
 or  services  offered  by  the  entity  within  the  three  (3)  months  immediately  preceding  the  date  of  the  call,  which  relationship  has  not 
 been  previously  terminated  by  either  party.  357 
 The  18-  month  time  period  runs  from  the  date  of  the  last  payment  or  transaction  with  the  company,  making  it  more  likely  that  a  consumer  would  expect  a  call  from  a  company  with  which 


 they  have  recently  conducted  business.  The  amended  definition  permits  the  relationship,  once  begun,  to  exist  for  eighteen  (18)  months  in  the  case  of  purchases  or  transactions  and  three  (3) 
 months  in  the  case  of  inquiries  or  applications,  unless  the  consumer  or  the  company  terminates  it.  We  emphasize  here  that  the  termination  of  an  established  business  relationship  is  significant 
 only  in  the  context  of  solicitation  calls.  358  Therefore,  consistent  with  the  language  in  the  definition,  a  companys  prior  relationship  with  a  consumer  entitles  the  company  to  call  that 
 consumer  for  eighteen  (18)  months  from  the  date  of  the  last  payment  or  financial  transaction,  even  if  the  company  does  not  currently  provide  service  to  that  customer.  359  For  example,  a 
 consumer  who  once  had  telephone  service  with  a  particular  carrier  or  a  subscription  with  a  particular  newspaper  could  expect  to  receive  a  call  from  those  entities  in  an  effort  to  winback 
 or  renew  that  consumers  business  within  eighteen  (18)  months.  In  the  context  of  telemarketing  calls,  a  consumers  prior  or  existing  relationship  continues  for  eighteen  (18) 
 months  (3  months  in  the  case  of  inquiries  and  applications)  or  until  the  customer  asks  to  be  placed  on  that  companys  do-  not-  call  list.  360 


 114.  Inquiries.  The  Commission  asked  whether  we  should  clarify  the  type  of  consumer  inquiry  that  would  create  an  established  business  relationship  for  purposes  of  the 
 exemption.  Some  consumers  and  consumer  groups  maintain  that  a  consumer  who  merely  inquires  about  a  product  should  not  be  subjected  to  subsequent  telemarketing  calls.  361  Industry 


 357  See  amended  47  C.  F.  R.    64.1200(  f)(  3). 
 358  We  also  note  that  the  act  of  terminating  an  established  business  relationship  will  not  hinder  or  thwart 
 creditors  attempts  to  reach  debtors  by  telephone,  to  the  extent  that  debt  collection  calls  constitute  neither  telephone  solicitations  nor  include  unsolicited  advertisements.  See  1995  TCPA  Reconsideration  Order,  10  FCC 


 Rcd  at  12400,  para.  17. 
 359  See  amended  47  C.  F.  R.    64.1200(  f)(  3). 


 360  See  infra  discussion  on  the  interplay  between  the  established  business  relationship  and  a  do-  not-  call  request, 
 para.  124. 
 361  NASUCA  Comments  at  17;  TOPUC  Comments  at  5-  6;  NCL  Comments  at  5  (EBR  should  be  narrowed  to 
 require  a  consumer  to  actually  set  up  an  account  with  a  company  for  the  purpose  of  making  recurring  or  repeated  purchases);  Michael  C.  Worsham  Comments  at  10;  Stewart  Abramson-  December  9,  2002  Comments  at  4-  5; 


 NYSCPB-  Other  Than  DNC  List  Comments  at  15. 
66

 Federal  Communications  Commission  FCC  03-  153 
 67 
 commenters,  on  the  other  hand,  believe  that  companies  should  be  permitted  to  call  consumers  who  have  made  inquiries  about  their  products  and  services,  and  that  consumers  have  come  to 
 expect  such  calls.  362  The  legislative  history  suggests  that  Congress  contemplated  that  an  inquiry  by  a  consumer  could  be  the  basis  of  an  established  business  relationship,  363  but  that  such  an 
 inquiry  should  occur  within  a  reasonable  period  of  time.  364  While  we  do  not  believe  any  communication  would  amount  to  an  established  business  relationship  for  purposes  of 
 telemarketing  calls,  we  do  not  think  the  definition  should  be  narrowed  to  only  include  situations  where  a  purchase  or  transaction  is  completed.  365  The  nature  of  any  inquiry  must,  however,  be 
 such  to  create  an  expectation  on  the  part  of  the  consumer  that  a  particular  company  will  call  them.  As  confirmed  by  several  industry  commenters,  an  inquiry  regarding  a  businesss  hours  or 
 location  would  not  establish  the  necessary  relationship  as  defined  in  Commission  rules.  366  By  making  an  inquiry  or  submitting  an  application  regarding  a  companys  products  or  services,  a 
 consumer  might  reasonably  expect  a  prompt  follow-  up  telephone  call  regarding  the  initial  inquiry  or  application,  not  one  after  an  extended  period  of  time.  Consistent  with  the  FTCs 
 conclusion,  the  Commission  believes  three  months  should  be  a  reasonable  time  in  which  to  respond  to  a  consumers  inquiry  or  application.  367  Thus,  we  amend  the  definition  of  established 
 business  relationship  to  permit  telemarketing  calls  within  three  (3)  months  of  an  inquiry  or  application  regarding  a  product  or  service  offered  by  the  company. 


 115.  We  emphasize  here  that  the  definition  of  established  business  relationship  requires  a  voluntary  two-  way  communication  between  a  person  or  entity  and  a  residential 
 subscriber  regarding  a  purchase  or  transaction  made  within  eighteen  (18)  months  of  the  date  of  the  telemarketing  call  or  regarding  an  inquiry  or  application  within  three  (3)  months  of  the  date 
 of  the  call.  Any  seller  or  telemarketer  using  the  EBR  as  the  basis  for  a  telemarketing  call  must  be  able  to  demonstrate,  with  clear  and  convincing  evidence,  that  they  have  an  EBR  with  the 
 called  party. 


 362  Verizon  Comments  at  15;  FSR  Comments  at  3-  4. 
 363  See  H.  R.  REP.  NO.  102-  317  at  14-  15  (1991)  (noting  that  if  an  investor  had  written  to  a  mutual  fund  or 
 responded  to  an  ad  requesting  additional  information,  the  funds  manager  could  make  follow-  up  calls.  The  Report  also  explains  that  a  loan  officer  or  financial  consultant  may  call  a  telephone  subscriber  who  had  requested  a  loan.). 


 364  H.  R.  REP.  NO.  102-  317  at  14,  15  (1991). 
 365  See,  e.  g.,  TOPUC  Comments  at  5-  6,  11  (  there  is  no  reason  for  a  customer  who  merely  inquires  about  a 
 product  or  service,  or  answers  a  survey,  to  be  subject  to  future  telemarketing  calls);  NCL  Comments  at  5  (definition  should  be  narrowed  to  include  situations  in  which  the  consumer  has  set  up  an  account  with  a  company 


 for  purposes  of  making  recurring  or  repeated  purchases). 
 366  Verizon  Comments  at  15;  ATA  Comments  at  104;  ABA  Comments  at  5. 


 367  Most  commenters  who  suggested  a  time  limit  on  the  EBR  did  not  specify  that  it  would  apply  to  inquiries.  But 
 see  Scholastic  Comments  at  8  (for  requests  of  information,  the  reasonable  amount  of  time  should  be  at  least  6  months);  DIRECTV  Reply  Comments  at  5  (FCC  should  adopt  the  same  timeframes  adopted  by  the  FTC  18 


 months  for  a  purchase  and  3  months  for  an  inquiry);  Intuit  Reply  Comments  at  7  (3-  month  rule  is  not  practical  from  the  perspective  of  an  online  service  provider  and  software  company;  customers  may  be  interested  in 
 upgrading  software  or  in  new  products  and  services  several  years  after  the  initial  purchase). 
67

 Federal  Communications  Commission  FCC  03-  153 
 68 
 116.  Different  Products  and  Services.  The  Commission  also  invited  comment  on  whether  to  consider  modifying  the  definition  of  established  business  relationship  so  that  a 
 company  that  has  a  relationship  with  a  customer  based  on  one  type  of  product  or  service  may  not  call  consumers  on  the  do-  not-  call  list  to  advertise  a  different  service  or  product.  368  Industry 
 commenters  believe  an  EBR  with  a  consumer  should  not  be  restricted  by  product  or  service,  but  rather,  should  permit  them  to  offer  the  full  range  of  their  services  and  products.  369  Consumer 
 advocates  who  commented  on  the  issue  maintain  that  a  company  that  has  a  relationship  based  on  one  service  or  product  should  not  be  allowed  to  use  that  relationship  to  market  a  different  service 
 or  product.  370  The  Commission  agrees  with  the  majority  of  industry  commenters  that  the  EBR  should  not  be  limited  by  product  or  service.  In  todays  market,  many  companies  offer  a  wide 
 variety  of  services  and  products.  Restricting  the  EBR  by  product  or  service  could  interfere  with  companies  abilities  to  market  them  efficiently.  Many  telecommunications  and  cable  companies, 
 for  example,  market  products  and  services  in  packages.  371  As  long  as  the  company  identifies  itself  adequately,  372  a  consumer  should  not  be  surprised  to  receive  a  telemarketing  call  from  that 
 company,  regardless  of  the  product  being  offered.  If  the  consumer  does  not  want  any  further  calls  from  that  company,  he  or  she  may  request  placement  on  its  do-  not-  call  list. 


 117.  Affiliated  Entities.  In  the  1992  TCPA  Order,  the  Commission  found  that  a  consumers  established  business  relationship  with  one  company  may  also  extend  to  the 


 368  2002  Notice,  17  FCC  Rcd  at  17472,  para.  20. 
 369  NCTA  Comments  at  2-  5  (  [  I]  t  is  precisely  because  cable  operators  now  compete  with  a  range  of  other 
 wireline  and  wireless  entities  in  providing  packages  of  different  services  and  products  that  it  is  more  important  than  ever  to  cable  operators  and  their  customers  that  operators  be  able  to  keep  their  customers  informed  of  the 


 full  range  of  offerings  and  promotions  available  to  them.);  Comcast  Comments  at  7-  8;  Cox  Comments  at  6-  8;  Yellow  Pages  Comments  at  8;  American  Express  Comments  at  3;  DMA  Comments  at  28. 


 370  John  A.  Shaw  Comments  at  4;  PUC  of  Ohio  Comments  at  15  (should  limit  the  contact  about  changes  or 
 updates  to  the  current  product  or  service.  For  example,  a  lawn  care  service  cannot  call  to  offer  vinyl  siding);  Joe  Shields  Further  Comments  at  3  (any  product  or  service  offered  through  telemarketing  must  be  substantially  related 


 to  the  product  that  created  the  relationship). 
 371  See  WorldCom  Comments  at  9  (describing  its  Neighborhood  product,  which  combines  a  special  feature 
 package  and  unlimited  local  and  long  distance  calling  for  one  price);  Cablevision  Reply  Comments  at  3  (noting  that  in  addition  to  telephone  and  telecom  products,  the  company  owns  an  array  of  entertainment  and  retail  venues. 


 It  also  faces  strong  competition  from  other  providers  of  video  programming,  and  needs  to  be  able  to  let  customers  for  one  line  of  service  know  about  other  services). 


 372  As  required  by  the  amended  rules  we  adopt  today,  [  a]  person  or  entity  making  a  call  for  telemarketing 
 purposes  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.  See  47  C.  F.  R.    64.1200(  d)(  4).  The  amended  rules  also  require  that  all  artificial  or  prerecorded  telephone  messages  shall,  [  a]  t  the  beginning  of  the  message,  state  clearly  the  identify  of  the  business,  individual, 
 or  other  entity  that  is  responsible  for  initiating  the  call.  If  a  business  is  responsible  for  initiating  the  call,  the  name  under  which  the  entity  is  registered  to  conduct  business  with  the  State  Corporation  Commission  (or  comparable 
 regulatory  authority)  must  be  stated,  and  [d]  uring  or  after  the  message,  state  clearly  the  telephone  number  (other  than  that  of  the  autodialer  or  prerecorded  message  player  which  placed  the  call)  of  such  business,  other  entity,  or 
 individual.  .  .  See  47  C.  F.  R.    64.1200(  b). 
68

 Federal  Communications  Commission  FCC  03-  153 
 69 
 companys  affiliates  and  subsidiaries.  373  Consumer  advocates  maintain  that  the  EBR  exemption  should  not  automatically  extend  to  affiliates  of  the  company  with  whom  a  consumer  has  a 
 business  relationship.  374  Industry  members  argue  that  it  should  apply  to  affiliates  that  provide  reasonably-  related  products  or  services.  375  The  Commission  finds  that,  consistent  with  the  FTCs 
 amended  Rule,  affiliates  fall  within  the  established  business  relationship  exemption  only  if  the  consumer  would  reasonably  expect  them  to  be  included  given  the  nature  and  type  of  goods  or 
 services  offered  and  the  identity  of  the  affiliate.  376  This  definition  offers  flexibility  to  companies  whose  subsidiaries  or  affiliates  also  make  telephone  solicitations,  but  it  is  based  on  consumers 
 reasonable  expectations  of  which  companies  will  call  them.  377  As  the  ATA  and  other  commenters  explain,  consumers  often  welcome  calls  from  businesses  they  know.  A  call  from  a 
 company  with  which  a  consumer  has  not  formed  a  business  relationship  directly,  or  does  not  recognize  by  name,  would  likely  be  a  surprise  and  possibly  an  annoyance.  This  determination  is 
 also  consistent  with  current  Commission  rules  on  the  applicability  of  do-  not-  call  requests  made  to  affiliated  persons  or  entities.  Under  those  rules,  a  residential  subscribers  do-  not-  call  request 
 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  advertised.  378 


 118.  Other  Issues.  The  Commission  clarifies  that  the  established  business  relationship  exemption  does  not  permit  companies  to  make  calls  based  on  referrals  from  existing  customers 
 and  clients,  379  as  the  person  referred  presumably  does  not  have  the  required  business  relationship  with  the  company  that  received  the  referral.  An  EBR  is  similarly  not  formed  when  a  wireless 
 subscriber  happens  to  use  another  carriers  services  through  roaming.  380  In  such  a  situation,  the  consumer  has  not  made  the  necessary  purchase  or  inquiry  that  would  constitute  an  EBR  or 


 373  See  1992  TCPA  Order,  7  FCC  Rcd  at  8770-  71,  para.  34. 
 374  NCL  Comments  at  5-  6;  NYSCPB-  Other  Than  DNC  List  Comments  at  7. 
 375  See,  e.  g.,  SBC  Comments  at  11  (This  is  consistent  with  sec.  272(  g),  which  allows  Bell  Operating  Companies  to 
 jointly  market  services  of  their  long  distance  affiliates);  Visa  Comments  at  6  (should  also  apply  to  co-  brand  and  affinity  partners);  FSR  Comments  at  4  (Commission  should  make  clear  that  any  member  of  a  corporate  family, 


 including  subsidiaries  and  affiliates,  should  be  permitted  to  call  as  long  as  customer  has  EBR  with  any  member). 
 376  Given  the  numerous  types  of  business  relationships,  the  Commission  believes  it  appropriate  to  treat  the  issue  of 
 a  consumers  reasonable  expectations  in  any  complaint  on  a  case-  by-  case  basis.  See  also  H.  R.  REP.  NO.  102-  317  at  15  (noting  that  contact  by  an  affiliate  of  the  company  with  whom  a  consumer  has  an  established  business 


 relationship  may  be  permissible  if  the  solicitation  by  the  affiliate  related  to  a  transaction  in  progress  with  the  consumer  or  was  substantially  related  to  the  product  or  service  forming  the  basis  of  the  business  relationship.). 


 377  See,  e.  g.,  American  Express  Comments  at  4. 
 378  See  47  C.  F.  R.    64.1200(  e)(  2)(  v). 
 379  See  New  Jersey  Ratepayer  Further  Reply  Comments  at  3  (providing  an  exemption  for  referrals  by  existing 
 customers  would  provide  an  open  door  and  the  element  of  consent  would  still  be  missing).  But  see  NAIFA  Comments  at  3. 


 380  See  AT&  T  Wireless  Comments  at  25  (arguing  that  an  established  business  relationship  is  formed  in  such  a 
 situation). 
69

 Federal  Communications  Commission  FCC  03-  153 
 70 
 provided  prior  express  consent  to  receive  telemarketing  calls  from  that  company.  We  recognize  that  companies  often  hire  third  party  telemarketers  to  market  their  services  and  products.  In 
 general,  those  telemarketers  may  rely  on  the  sellers  EBR  to  call  an  individual  consumer  to  market  the  sellers  services  and  products.  381  However,  we  disagree  with  Nextel  that  a 
 consumers  EBR  with  a  third  party  telemarketer,  including  a  retail  store  or  independent  dealer,  extends  to  a  seller  simply  because  the  seller  has  a  contractual  relationship  with  that  telemarketer. 
 The  seller  would  only  be  entitled  to  call  a  consumer  under  the  EBR  exemption  based  on  its  own  EBR  with  a  consumer.  382  We  also  disagree  with  WorldCom  that  the  EBR  should  extend  to 
 marketing  partners  for  purposes  of  telemarketing  joint  offers,  to  the  extent  the  partner  companies  have  no  EBR  with  the  consumer.  383 


 2.  Telecommunications  Common  Carriers 
 119.  In  the  2002  Notice,  we  asked  what  effect  the  established  business  relationship  exemption  might  have  on  the  telecommunications  industry,  if  a  national  do-  not-  call  list  is 


 established.  According  to  WorldCom,  telephone  solicitations  are  the  primary  mechanism  for,  and  the  means  by  which  consumers  are  accustomed  to,  purchasing  competitive 
 telecommunications  services.  384  WorldCom  argues  that  with  the  advent  of  competition  in  the  formerly  monopolized  local  telephone  markets,  and  the  entry  of  the  Regional  Bell  Operating 
 Companies  into  the  long  distance  market,  carriers  need  to  be  able  to  market  effectively  their  new  services.  385  WorldCom  argues  that  a  national  do-  not-  call  list  that  exempts  calls  to  persons  with 
 whom  a  company  has  established  business  relationships  will  favor  incumbent  providers.  386  According  to  WorldCom,  incumbent  local  exchange  carriers  maintain  most  of  the  local  customer 
 base,  and  therefore  would  be  able  to  telemarket  new  services  to  all  those  customers,  regardless  of  whether  they  were  on  the  national  do-  not-  call  registry,  because  of  the  established  business 
 relationship  exemption.  New  competitors,  on  the  other  hand,  would  be  restricted  from  calling  those  same  consumers. 


 381  See  Verizon  Comments  at  14-  15. 
 382  See  Nextel  Reply  Comments  at  15-  17.  However,  if  a  consumer  purchases  a  sellers  products  at  a  retail  store  or 
 from  an  independent  dealer,  such  purchase  would  establish  a  business  relationship  with  the  seller,  entitling  the  seller  to  call  that  consumer  under  the  EBR  exemption. 


 383  See  Notice  of  Ex  Parte  Presentation  from  WorldCom  to  FCC  at  8,  filed  June  16,  2003. 
 384  WorldCom  Comments  at  7. 
 385  WorldCom  Comments  at  9  (  telemarketing  is  the  most  cost-  effective  way  to  introduce  new  products  and 
 services  to  the  public,  especially  local  and  long  distance  telecommunications  services  that  customers  customize  for  their  specific  needs  (footnote  omitted)). 


 386  WorldCom  Comments  at  13;  see  also  ATA  Reply  Comments  at  30-  32;  Winstar  Further  Comments  at  3-  4 
 (maintaining  that  the  FCC  should  either  exempt  telecommunications  service  providers  from  the  do-  not-  call  rules  or  implement  rules  that  prevent  incumbents  from  using  the  EBR  to  preserve  their  monopoly);  CompTel  Further  Reply 


 Comments  at  2  (should  follow  WorldComs  suggestion  and  determine  that  all  consumers  have  an  EBR  with  all  providers  of  local  service).  But  see  Wayne  G.  Strang  Reply  Comments  at  16  (suggesting  that  WorldComs 
 arguments  are  exaggerated  as  even  those  entities  that  have  an  established  business  relationship  with  a  subscriber  may  not  take  advantage  of  the  exemption  once  the  subscriber  makes  a  do-  not-  call  request). 
70

 Federal  Communications  Commission  FCC  03-  153 
 71 
 120.  One  approach  would  be  to  narrow  the  established  business  relationship  for  telecommunications  carriers,  so  that  a  carrier  doing  business  with  customers  based  on  one  type 
 of  service  may  not  call  those  customers  registered  with  the  national  do-  not-  call  list  to  advertise  a  different  service.  387  We  find,  however,  that  the  record  does  not  support  such  an  approach  in  the 
 context  of  telemarketing  calls.  Along  with  the  majority  of  industry  commenters  in  this  proceeding,  WorldCom  maintains  that  companies  must  have  flexibility  in  communicating  with 
 their  customers  not  only  about  their  current  services,  but  also  to  discuss  available  alternative  services  or  products.  .  .  .  388  Limiting  a  common  carriers  established  business  relationship  by 
 product  or  service  might  harm  competitors  efforts  to  market  new  goods  or  services  to  existing  customers,  and  would  not  be  in  the  public  interest. 


 121.  WorldCom  proposes  instead  that  the  Commission  revise  the  definition  of  established  business  relationship  so  that  all  providers  of  a  telecommunications  service 
 incumbents  and  new  entrants  alike  are  deemed  to  have  an  established  business  relationship  with  all  consumers.  389  Alternatively,  WorldCom  suggests  that  the  definition  of  an  established 
 business  relationship  be  revised  to  exclude  a  company  whose  relationship  with  a  consumer  is  based  solely  on  a  service  for  which  the  company  has  been  a  dominant  or  monopoly  provider  of 
 the  service,  until  such  time  as  competitors  for  that  service  have  sufficiently  penetrated  the  market.  390 


 122.  Although  we  take  seriously  WorldComs  concerns  about  the  potential  effects  of  a  national  do-  not-  call  list  on  competition  in  the  telecommunications  marketplace,  we  decline  to 
 expand  the  definition  of  established  business  relationship  so  that  common  carriers  are  deemed  to  have  relationships  with  all  consumers  for  purposes  of  making  telemarketing  calls.  Broadening 
 the  scope  of  the  established  business  relationship  in  such  a  way  would  be  inconsistent  with  Congresss  mandate  to  protect  residential  telephone  subscribers  privacy  rights  to  avoid 
 receiving  telephone  solicitations  to  which  they  object.  391  To  permit  common  carriers  to  call  consumers  with  whom  they  have  no  existing  relationships  and  who  have  expressed  a  desire  not 
 to  be  called  by  registering  with  the  national  do-  not-  call  list,  would  likely  confuse  consumers  and 


 387  See  2002  Notice,  17  FCC  Rcd  at  17472,  para.  20;  see  also  Shaw  Further  Reply  Comments  at  13  (if  there  is  any 
 competition  problem,  the  EBR  for  ILECS  should  not  allow  them  to  sell  the  customer  additional  services  or  products). 


 388  WorldCom  Comments  at  15.  See  also  WorldCom  Comments  at  15-  16  (arguing  that  limiting  calls  to  those 
 related  to  the  customers  current  service  does  not  make  sense  in  a  market  where  products  are  increasingly  integrated). 


 389  WorldCom  Reply  Comments  at  11.  But  see  Verizon  Further  Reply  Comments  at  2-  3  (it  would  be  at  odds  with 
 the  plain  meaning  of  EBR  to  adopt  WorldComs  suggestion  that  all  consumers  would  have  an  EBR  with  WorldCom). 


 390  WorldCom  Reply  Comments  at  11. 
 391  See  47  U.  S.  C.    227(  c)(  1). 
71

 Federal  Communications  Commission  FCC  03-  153 
 72 
 interfere  with  their  ability  to  manage  and  monitor  the  telemarketing  calls  they  receive.  392 
 123.  We  further  note  that  with  the  establishment  of  a  national  do-  not-  call  registry,  carriers  will  still  be  permitted  to  contact  competitors  customers  who  have  not  placed  their 


 numbers  on  the  national  list.  In  addition,  carriers  will  be  able  to  call  their  prior  and  existing  customers  for  18  months  to  market  new  products  and  services,  such  as  long  distance,  local,  or 
 DSL  services,  as  long  as  those  customers  have  not  placed  themselves  on  that  carriers  company-specific  do-  not-  call  list.  393  For  the  remaining  consumers  with  whom  common  carriers  have  no 
 established  business  relationship  and  who  are  registered  with  the  do-  not-  call  list,  carriers  may  market  to  them  using  different  advertising  methods,  such  as  direct  mail.  Therefore,  we  find  that 
 treating  common  carriers  like  other  entities  that  use  the  telephone  to  advertise,  best  furthers  the  goals  of  the  TCPA  to  protect  consumer  privacy  interests  and  to  avoid  interfering  with  existing 
 business  relationships. 
 3.  Interplay  Between  Established  Business  Relationship  and  Do-  Not-  Call  Request 


 124.  In  the  2002  Notice,  we  sought  comment  on  the  effect  of  a  do-  not-  call  request  on  an  established  business  relationship.  394  We  noted  the  legislative  history  on  this  issue,  which 
 suggests  that  despite  an  established  business  relationship,  a  company  that  has  been  asked  by  a  consumer  not  to  call  again,  must  honor  that  request  and  avoid  further  calls  to  that  consumer.  395 
 Consumer  advocates  who  discussed  the  interplay  between  the  established  business  relationship  and  a  do-  not-  call  request  maintained  that  a  do-  not-  call  request  should  trump  an  established 
 business  relationship,  396  and  that  consumers  should  not  be  required  to  terminate  business  relationships  in  order  to  stop  unwanted  telemarketing  calls.  397  The  majority  of  industry 


 392  We  note  that  of  the  TCPA-  related  complaints  filed  by  consumers  with  the  Commission,  a  substantial  number 
 have  been  against  common  carriers.  See  Caroline  E.  Mayer,  Do  Not  Call  List  Operator  AT&  T  Leads  in  Complaints,  Washingtonpost.  com  (April  23,  2003)  <http://  washingtonpost.  com/  wp-  dyn/  articles/  A17683- 


 2003Apr22.  html>  (describing  the  number  of  complaints  filed  against  AT&  T  and  other  common  carriers  for  do-not-  call  violations);  see  also  ATA  Comments,  Appendix  16. 


 393  See  supra  para.  113  for  a  discussion  regarding  termination  of  the  established  business  relationship  for  purposes 
 of  telemarketing  calls. 
 394  2002  Notice,  17  FCC  Rcd  at  17480-  81,  para.  35. 


 395  See  H.  R.  REP.  NO.  102-  317  at  15-  16  (1991)  (  If  a  subscriber  asks  a  company  with  whom  it  has  an  established 
 relationship  not  to  call  again,  that  company  has  an  obligation  to  honor  the  request  and  avoid  further  contacts.  Despite  the  fact  that  objecting  subscribers  can  be  called  based  on  an  established  business  relationship,    it  is  the 


 strongly  held  view  of  the  Committee  that  once  a  subscriber  objects  to  a  business  that  calls  based  on  an  established  relationship,  such  business  must  honor  this  second  objection  and  implement  procedures  not  to  call  that  twice-objecting 
 subscriber  again.). 
 396  See,  e.  g.,  Thomas  M.  Pechnik  Comments  at  3;  Joe  W.  McDaniel-  Fifth  December  5,  2002  Comments;  City  of 
 Chicago  Comments  at  11-  12;  Philip  J.  Charvat  Comments  at  8;  Mark  A.  Hiner  Comments;  Barbara  Crouse  Comments  (receives  calls  from  a  newspaper  because  she  is  a  subscriber,  even  when  she  asks  to  be  placed  on  a  do-not- 


 call  list);  Wayne  G.  Strang  Comments  at  13;  TOPUC  Comments  at  6. 
 397  Owen  ONeill  Comments  at  2;  City  of  New  Orleans  Comments  at  10. 
72

 Federal  Communications  Commission  FCC  03-  153 
 73 
 commenters  also  supported  the  notion  that  companies  should  honor  requests  from  individual  consumers  not  to  be  called,  regardless  of  whether  there  is  a  business  relationship.  398  As 
 discussed  earlier,  companies  will  be  permitted  to  call  consumers  with  whom  they  have  an  established  business  relationship  for  a  period  of  18  months  from  the  last  payment  or  transaction, 
 even  when  those  consumers  are  registered  on  the  national  do-  not-  call  list,  as  long  as  a  consumer  has  not  asked  to  be  placed  on  the  companys  do-  not-  call  list.  Once  the  consumer  asks  to  be 
 placed  on  the  company-  specific  do-  not-  call  list,  the  company  may  not  call  the  consumer  again  regardless  of  whether  the  consumer  continues  to  do  business  with  the  company.  This  will  apply 
 to  all  services  and  products  offered  by  that  company.  399  If  the  consumer  continues  to  do  business  with  the  telemarketer  after  asking  not  to  be  called  (by,  for  example,  continuing  to  hold  a  credit 
 card,  subscribing  to  a  newspaper,  or  making  a  subsequent  purchase),  the  consumer  cannot  be  deemed  to  have  waived  his  or  her  company-  specific  do-  not-  call  request.  400  As  described  above, 
 we  amend  the  company-  specific  do-  not-  call  rules  to  apply  to  any  call  for  telemarketing  purposes  to  make  clear  that  a  company  must  cease  making  telemarketing  calls  to  any  customer 
 who  has  made  a  do-  not-  call  request,  regardless  of  whether  they  have  an  EBR  with  that  customer.  401  We  also  adopt  a  provision  stating  that  a  consumers  do-  not-  call  request  terminates 
 the  EBR  for  purposes  of  telemarketing  calls  even  if  the  consumer  continues  to  do  business  with  the  seller.  402 


 VII.  TAX-  EXEMPT  NONPROFIT  ORGANIZATION  EXEMPTION 
 A.  Background 
 125.  The  term  telephone  solicitation,  as  defined  in  the  TCPA,  does  not  include  a  call  or  message  by  a  tax-  exempt  nonprofit  organization.  403  The  Commission  concluded,  as  part  of 


 its  1995  Reconsideration  Order,  that  calls  placed  by  an  agent  of  the  telemarketer  are  treated  as  if 


 398  See,  e.  g.,  DialAmerica  Comments  at  14;  AT&  T  Wireless  Comments  at  26-  27;  Verizon  Comments  at  15;  HFS 
 Comments  at  9;  NCTA  Comments  at  5.  But  see  Bank  of  America  Comments  at  6  (a  do-  not-  call  request  should  not  terminate  the  relationship,  and  businesses  should  be  able  to  continue  calling  those  customers). 


 399  See,  e.  g.,  Philip  J.  Charvat  Comments  at  8  (If  product  exceptions  to  do-  not-  call  requests  were  allowed,  the 
 TCPAs  effectiveness  would  be  eviscerated.  A  credit  card  offer  declined  by  a  consumer  with  a  [do-  not-  call]  demand,  will  be  followed  by  a  shopping  convenience  card  offer  from  the  same  entity);  Stewart  Abramson-December 


 9,  2002  Comments  at  1  (a  do-  not-  call  request  should  apply  to  the  business  generally,  not  just  by  product  or  service.  Otherwise,  it  would  be  very  time-  consuming  for  the  consumer). 


 400  In  some  instances,  however,  a  consumer  may  grant  explicit  consent  to  be  called  during  the  course  of  a 
 subsequent  purchase  or  transaction. 
 401  See  amended  rule  at  47  C.  F.  R.    64.1200(  d).  See  also  supra  para.  96. 


 402  See  amended  rule  at  47  C.  F.  R.    64.1200(  f)(  3)(  i). 
 403  47  U.  S.  C.    227(  a)(  3).  In  its  initial  rulemaking  in  1992,  the  Commission  concluded  that,  in  the  same  vein, 
 calls  by  tax-  exempt  nonprofit  organizations  also  should  be  exempt  from  the  prohibition  on  prerecorded  messages  to  residences  as  non-  commercial  calls.  See  1992  TCPA  Order,  7  FCC  Rcd  at  8773-  74,  para.  40;  see  also  47 


 U.  S.  C.    227(  a)(  3)(  C)  and  47  C.  F.  R.    64.1200(  c)(  4). 
73

 Federal  Communications  Commission  FCC  03-  153 
 74 
 the  telemarketer  itself  placed  the  call.  404  Therefore,  calls  made  by  independent  telemarketers  on  behalf  of  tax-  exempt  nonprofits  also  are  not  subject  to  the  rules  governing  telephone 
 solicitations.  405 
 126.  Over  the  years,  the  Commission  has  received  inquiries  about  calls  made  jointly  by  nonprofit  and  for-  profit  organizations.  In  the  2002  Notice,  we  described  a  scenario  in  which  a 


 tax-  exempt  nonprofit  organization  calls  consumers  to  sell  another  companys  magazines  and  receives  a  portion  of  the  proceeds.  We  then  asked  whether  such  calls  should  be  exempt  from  the 
 restrictions  on  telephone  solicitations  and  prerecorded  messages  as  calls  made  by  a  tax-  exempt  nonprofit  organization.  406 


 127.  Tax-  exempt  nonprofit  organizations  explained  that  they  rely  on  the  expertise  and  operational  efficiencies  of  professional  fundraisers  to  conduct  their  fundraising  campaigns. 
 Therefore,  they  support  the  continued  exemption  for  professional  fundraisers  that  call  on  behalf  of  nonprofit  organizations.  407  Many  commenters,  while  supportive  of  the  exemption  for  calls  by 
 nonprofits,  were  concerned  that  it  frequently  has  been  used  to  veil  what  is  in  reality  a  commercial  venture.  408  Some  commenters  emphasized  that  the  TCPA  nonprofit  exemption 
 should  not  function  as  an  artifice  for  an  inherently  commercial  enterprise.  409  NAAG,  for  example,  maintained  that  calls  that  serve  to  benefit  for-  profit  companies  (in  whole  or  in  part)  are 
 not  calls  by  or  on  behalf  of  nonprofits  and  should  remain  subject  to  the  TCPAs  restrictions.  410  The  Association  of  Fundraising  Professionals  similarly  asserted  that  this  type  of  nonprofit/  for-profit 
 initiative  does  not  represent  a  pure  charitable  appeal;  that  the  primary  purpose  of  such  a  transaction  is  receipt  of  a  product  or  service  by  the  consumer,  not  the  charitable  transfer  of 


 404  See  1995  TCPA  Reconsideration  Order,  10  FCC  Rcd  at  12397,  para.  13. 
 405  See  1995  TCPA  Reconsideration  Order,  10  FCC  Rcd  at  12397,  para.  13. 
 406  2002  Notice,  17  FCC  Rcd  at  17479,  para.  33. 
 407  NPCC  Comments  at  12-  13;  March  of  Dimes  Comments  at  2;  Special  Olympics-  Hawaii  Comments;  NPCC 
 Comments  at  4  (  An  estimated  60  percent  to  70  percent  of  nonprofit  and  charitable  organizations  use  professional  fundraisers  to  deliver  their  messages  to  consumers  and  solicit  donations.  (cites  omitted)). 


 408  NPCC  Comments  at  10;  Donald  R.  Davis  Comments;  Private  Citizen  Comments  at  4;  Gregory  S.  Reichenbach 
 Comments. 
 409  NPCC  Comments  at  10.  See  also  Private  Citizen  Comments  at  4;  Gregory  S.  Reichenbach  Comments. 


 410  NAAG  Comments  at  39  (describing  an  example  of  a  for-  profit  sending  prerecorded  messages  to  residential 
 phone  numbers,  promising  to  reduce  interest  rates  and  save  consumers  money  repaying  their  credit  card  debt.  The  prerecorded  message  did  not  disclose  how  the  savings  would  be  achieved  and  did  not  identify  any  nonprofit 


 organization.  If  a  caller  responded  to  the  1-  800  number  on  the  message,  the  caller  reached  the  for-  profit  call  center.  In  the  sales  pitch  that  followed,  the  telemarketer  described  credit  counseling  services  offered  by  a 
 nonprofit  organization.  However,  the  telemarketer  solicited  enrollment  fees  (between  $199-  499),  payable  entirely  to  the  for-  profit  company.  .  .  Consumers  interested  in  nonprofit  credit  counseling  would  be  referred  to  a 
 nonprofit  credit  counselor,  but  only  after  they  paid  hundreds  of  dollars  to  the  for-  profit  marketing  company.);  see  also  Wayne  G.  Strang  Comments  at  7;  City  of  New  Orleans  Comments  at  9-  10;  Donald  R.  Davis  Comments. 
74

 Federal  Communications  Commission  FCC  03-  153 
 75 
 funds.  411  One  commenter  suggested  that  the  test  for  whether  a  call  is  made  on  behalf  of  a  nonprofit  organization  should  be  whether  payment  is  made  to  the  tax-  exempt  nonprofit 
 organization.  412  DialAmerica,  on  the  other  hand,  urged  the  Commission  to  confirm  that  the  exemption  also  applies  when  for-  profits  call,  conduct  a  commercial  transaction,  and  donate  a 
 percentage  of  the  proceeds  to  nonprofit  charitable  organizations.  413 
 B.  Discussion 
 128.  We  reaffirm  the  determination  that  calls  made  by  a  for-  profit  telemarketer  hired  to  solicit  the  purchase  of  goods  or  services  or  donations  on  behalf  of  a  tax-  exempt  nonprofit 


 organization  are  exempted  from  the  rules  on  telephone  solicitation.  414  In  crafting  the  TCPA,  Congress  sought  primarily  to  protect  telephone  subscribers  from  unrestricted  commercial 
 telemarketing  activities,  finding  that  most  unwanted  telephone  solicitations  are  commercial  in  nature.  415  In  light  of  the  record  before  us,  the  Commission  believes  that  there  has  been  no 
 change  in  circumstances  that  warrant  distinguishing  those  calls  made  by  a  professional  telemarketer  on  behalf  of  a  tax-  exempt  nonprofit  organization  from  those  made  by  the  tax-exempt 
 nonprofit  itself.  The  Commission  recognizes  that  charitable  and  other  nonprofit  entities  with  limited  expertise,  resources  and  infrastructure,  might  find  it  advantageous  to  contract  out  its 
 fundraising  efforts.  416  Consistent  with  section  227,  a  tax-  exempt  nonprofit  organization  that  conducts  its  own  fundraising  campaign  or  hires  a  professional  fundraiser  to  do  it,  will  not  be 
 subject  to  the  restrictions  on  telephone  solicitations.  417  If,  however,  a  for-  profit  organization  is  delivering  its  own  commercial  message  as  part  of  a  telemarketing  campaign  (i.  e.,  encouraging 
 the  purchase  or  rental  of,  or  investment  in,  property,  goods,  or  services),  418  even  if  accompanied  by  a  donation  to  a  charitable  organization  or  referral  to  a  tax-  exempt  nonprofit  organization,  419 


 411  AFP  Comments  at  3. 
 412  Reese  Comments  at  10. 
 413  DialAmerica  Comments  at  13-  14.  See  also  DialAmerica  Reply  Comments  at  13  (DialAmericas  Sponsor 
 Magazine  Program  donates  12.5%  of  the  proceeds  to  the  charity.). 
 414  We  again  reiterate  that  calls  that  do  not  fall  within  the  definition  of  telephone  solicitation  as  defined  in 
 section  227(  a)(  3)  will  not  be  precluded  by  the  national  do-  not-  call  list.  These  may  include  calls  regarding  surveys,  market  research,  and  calls  involving  political  and  religious  discourse.  See  supra  para.  37. 


 415  See  H.  R.  REP.  NO.  102-  317  at  16-  17  (1991). 
 416  See  NPCC  Comments  at  13  (  Nonprofit  and  charitable  organizations  rely  on  the  expertise  and  operational 
 efficiencies  of  professional  fundraisers  to  conduct  their  fundraising  campaigns  and  disseminate  their  message.  .  .  .  Such  trained  professionals  offer  significant  resources,  expertise  and  operational  efficiencies  that  cannot  be 


 duplicated  by  nonprofit  and  charitable  organizations.  (emphasis  added;  cites  omitted)) 
 417  These  restrictions  are  found  in  amended  47  C.  F.  R.    64.1200(  c)  and  (d). 


 418  See  47  U.  S.  C.    227(  a)(  3)  and  amended  47  C.  F.  R.    64.1200(  f)(  9). 
 419  Similarly,  an  affiliate  of  a  tax-  exempt  nonprofit  organization  that  is  itself  not  a  tax-  exempt  nonprofit  is  not 
 exempt  from  the  TCPA  rules  when  it  makes  telephone  solicitations. 
75

 Federal  Communications  Commission  FCC  03-  153 
 76 
 that  call  is  not  by  or  on  behalf  of  a  tax-  exempt  nonprofit  organization.  420  Such  calls,  whether  made  by  a  live  telemarketer  or  using  a  prerecorded  message,  would  not  be  entitled  to  exempt 
 treatment  under  the  TCPA.  We  emphasize  here,  as  we  did  in  the  2002  Notice,  that  the  statute  and  our  rules  clearly  apply  already  to  messages  that  are  predominantly  commercial  in  nature,  and 
 that  we  will  not  hesitate  to  consider  enforcement  action  should  the  provider  of  an  otherwise  commercial  message  seek  to  immunize  itself  by  simply  inserting  purportedly  non-  commercial 
 content  into  that  message.  A  call  to  sell  debt  consolidation  services,  for  example,  is  a  commercial  call  regardless  of  whether  the  consumer  is  also  referred  to  a  tax-  exempt  nonprofit 
 organization  for  counseling  services.  421  Similarly,  a  seller  that  calls  to  advertise  a  product  and  states  that  a  portion  of  the  proceeds  will  go  to  a  charitable  cause  or  to  help  find  missing  children 
 must  still  comply  with  the  TCPA  rules  on  commercial  calls. 
 VIII.  AUTOMATED  TELEPHONE  DIALING  EQUIPMENT 
 A.  Background 
 129.  The  TCPA  and  Commissions  rules  prohibit  calls  using  an  automatic  telephone  dialing  system  (or  autodialer)  to  emergency  telephone  lines,  to  the  telephone  line  of  a  guest 


 room  of  a  health  care  facility,  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.  422  Section  227  defines  automatic  telephone  dialing  system  as  equipment  which  has  the  capacity  (A)  to  store  or  produce  telephone  numbers  to  be  called,  using  a  random  or 
 sequential  number  generator;  and  (B)  to  dial  such  numbers.  423  In  the  2002  Notice,  the  Commission  explained  that  more  sophisticated  dialing  systems,  such  as  predictive  dialers  and 
 answering  machine  detection  software,  are  now  widely  used  by  telemarketers  to  increase  productivity.  We  invited  comment  on  these  and  other  technologies  and  asked  whether  they  fall 
 within  the  restrictions  on  automatic  telephone  dialing  systems.  424 
 130.  Most  industry  members  that  commented  on  the  issue  of  autodialed  calls  argue  that  predictive  dialers  do  not  fall  within  the  statutory  definition  of  automatic  telephone  dialing 


 system,  primarily  because,  they  contend,  predictive  dialers  do  not  dial  numbers  randomly  or  sequentially.  425  Rather,  they  state  that  predictive  dialers  store  pre-  programmed  numbers  or 


 420  See  NPCC  Comments  at  10;  AFP  Comments  at  3. 
 421  Unlike  debt  collection  calls,  a  consumer  may  terminate  an  established  business  relationship  with  a  company 
 offering  debt  consolidation  services  by  requesting  placement  on  a  company-  specific  do-  not-  call  list.  See  supra  note  358. 


 422  47  U.  S.  C.    227(  b)(  1)(  A)(  i)-(  iii);  47  C.  F.  R.    64.1200(  a)(  1)(  i)-(  iii). 
 423  47  U.  S.  C.    227(  a)(  1);  see  also,  47  C.  F.  R.    64.1200(  f)(  1). 
 424  2002  Notice,  17  FCC  Rcd  at  17473-  74,  paras.  23-  24. 
 425  See,  e.  g.,  Mastercard  Comments  at  6;  Verizon  Comments  at  23;  HFS  Comments  at  7;  Discover  Comments  at  8; 
 CBA  Comments  at  7-  8;  Bank  of  America  Comments  at  5;  ATA  Comments  at  113-  114.  But  see  American  General  Finance  Comments  at  1  (urging  the  Commission  to  clarify  the  definitions  of  automatic  telephone  dialing  system 


 (continued.) 
76

 Federal  Communications  Commission  FCC  03-  153 
 77 
 receive  numbers  from  a  computer  database  and  then  dial  those  numbers  in  a  manner  that  maximizes  efficiencies  for  call  centers.  426  Most  consumers  and  consumer  groups  maintain  that 
 predictive  dialers  are  autodialers;  that  to  distinguish  technologies  on  the  basis  of  whether  they  dial  randomly  or  use  a  database  of  numbers  would  create  a  distinction  without  a  difference.  427 
 They  argue  that  for  the  recipient  of  the  call,  there  is  no  difference  whether  the  number  is  dialed  at  random  or  from  a  database  of  numbers.  428  A  few  commenters  contend  that  even  when  a 
 database  of  numbers  is  used,  the  numbers  can  be  dialed  in  sequence.  429  In  addition,  LCC  urges  the  Commission  to  clarify  that  modems  used  for  non-  telemarketing  purposes  are  excluded  from 
 the  definition  of  automatic  telephone  dialing  system.  430 
 B.  Discussion 
 1.  Predictive  Dialers 
 131.  Automated  Telephone  Dialing  Equipment.  The  record  demonstrates  that  a  predictive  dialer  is  equipment  that  dials  numbers  and,  when  certain  computer  software  is 


 attached,  also  assists  telemarketers  in  predicting  when  a  sales  agent  will  be  available  to  take  calls.  431  The  hardware,  when  paired  with  certain  software,  has  the  capacity  to  store  or  produce 
 numbers  and  dial  those  numbers  at  random,  in  sequential  order,  or  from  a  database  of  numbers.  432  As  commenters  point  out,  in  most  cases,  telemarketers  program  the  numbers  to  be  called  into 
 the  equipment,  and  the  dialer  calls  them  at  a  rate  to  ensure  that  when  a  consumer  answers  the  phone,  a  sales  person  is  available  to  take  the  call.  433  The  principal  feature  of  predictive  dialing 


 (Continued  from  previous  page)  and  autodialer,  which  focus  on  equipment  that  has  the  capacity  to  generate  random  number  and  sequential 
 dialing  patterns,  rather  than  on  whether  the  equipment  is  actually  used  in  that  fashion). 
 426  See,  e.  g.,  Mastercard  Comments  at  6;  HFS  Comments  at  7;  Verizon  Comments  at  23;  Discover  Comments  at  8. 


 427  See,  e.  g.,  EPIC  Comments  at  12;  City  of  Chicago  Comments  at  9-  11;  Stewart  Abramson  Comments  at  1-  2; 
 Michael  C.  Worsham  Comments  at  6. 
 428  See,  e.  g.,  Thomas  M.  Pechnik  Comments  at  4;  Stewart  Abramson  Comments  at  2  (FCC  should  not  have  to 
 identify  specific  technologies  covered  by  definition  as  technologies  are  always  changing).  But  see  Wayne  G.  Strang  Comments  at  6  (should  ask  Congress  to  change  the  definition  to  cover  all  devices  capable  of  automatically 


 dialing  calls). 
 429  See  Thomas  M.  Pechnik  Comments  at  5;  Michael  C.  Worsham  Comments  at  5. 


 430  See  LCC  Comments  at  7.  LCC  explains  that,  on  behalf  of  certain  clients,  it  installs  terrestrial  repeaters  across 
 the  country,  which  receive  satellite  signals  and  retransmit  the  signals  into  areas  that  the  signals  would  not  otherwise  reach.  The  repeaters  contain  an  on-  board  modem,  which  may  be  programmed  to  call  the  clients 


 number  in  the  event  a  malfunction  occurs.  If  the  modem  is  programmed  incorrectly,  it  may  dial  a  number  other  than  the  number  of  the  client.  See  LCC  Comments  at  2-  3. 


 431  See,  e.  g.,  HFS  Comments  at  7;  ATA  Comments  at  110;  ABA  Comments  at  3. 
 432  See  ATA  Comments  at  113,  n.  108;  DMA  Comments  at  21  (  Some  dialers  are  capable  of  being  programmed 
 for  sequential  or  random  dialing;  some  are  not.). 
 433  Mastercard  Comments  at  6. 
77

 Federal  Communications  Commission  FCC  03-  153 
 78 
 software  is  a  timing  function,  not  number  storage  or  generation.  Household  Financial  Services  states  that  these  machines  are  not  conceptually  different  from  dialing  machines  without  the 
 predictive  computer  program  attached.  434 
 132.  The  TCPA  defines  an  automatic  telephone  dialing  system  as  equipment  which  has  the  capacity  (A)  to  store  or  produce  telephone  numbers  to  be  called,  using  a  random  or 


 sequential  number  generator;  and  (B)  to  dial  such  numbers.  435  The  statutory  definition  contemplates  autodialing  equipment  that  either  stores  or  produces  numbers.  It  also  provides  that, 
 in  order  to  be  considered  an  automatic  telephone  dialing  system,  the  equipment  need  only  have  the  capacity  to  store  or  produce  telephone  numbers  (emphasis  added).  .  ..  It  is  clear  from  the 
 statutory  language  and  the  legislative  history  that  Congress  anticipated  that  the  FCC,  under  its  TCPA  rulemaking  authority,  might  need  to  consider  changes  in  technologies.  436  In  the  past, 
 telemarketers  may  have  used  dialing  equipment  to  create  and  dial  10-  digit  telephone  numbers  arbitrarily.  As  one  commenter  points  out,  the  evolution  of  the  teleservices  industry  has 
 progressed  to  the  point  where  using  lists  of  numbers  is  far  more  cost  effective.  437  The  basic  function  of  such  equipment,  however,  has  not  changed  the  capacity  to  dial  numbers  without 
 human  intervention.  We  fully  expect  automated  dialing  technology  to  continue  to  develop. 
 133.  The  legislative  history  also  suggests  that  through  the  TCPA,  Congress  was  attempting  to  alleviate  a  particular  problem  an  increasing  number  of  automated  and 


 prerecorded  calls  to  certain  categories  of  numbers.  438  The  TCPA  does  not  ban  the  use  of  technologies  to  dial  telephone  numbers.  It  merely  prohibits  such  technologies  from  dialing 
 emergency  numbers,  health  care  facilities,  telephone  numbers  assigned  to  wireless  services,  and  any  other  numbers  for  which  the  consumer  is  charged  for  the  call.  439  Such  practices  were 
 determined  to  threaten  public  safety  and  inappropriately  shift  marketing  costs  from  sellers  to 


 434  HFS  Comments  at  7. 
 435  47  U.  S.  C.    227(  a)(  1). 
 436  See  137  Cong.  Rec.  S18784  (1991)  (statement  of  Sen.  Hollings)  (  The  FCC  is  given  the  flexibility  to  consider 
 what  rules  should  apply  to  future  technologies  as  well  as  existing  technologies.).  See  also  Southern  Co.  v.  FCC,  293  F.  3d  1338,  1346  (11th  Cir.  2002)  (  While  the  FCC  is  correct  that  the  principle  of  nondiscrimination  is  the 


 primary  purpose  of  the  1996  Telecommunications  Act,  we  must  construe  statutes  in  such  a  way  to  give  effect,  if  possible,  to  every  clause  and  word  of  a  statute.)  (quoting  Williams  v.  Taylor,  529  U.  S.  362,  404  (2000)  (internal 
 quotation  marks  omitted)). 
 437  ATA  Comments  at  113. 


 438  NASUCA  Comments  at  4-  5. 
 439  One  commenter  suggests  that  databases  of  emergency  and  cellular  numbers  are  commercially  available  which 
 can  be  used  to  exclude  emergency  numbers,  health  care  facilities  and  wireless  numbers  from  an  automated  dialers  calling  list.  See  ECN  Comments  at  3.  The  Commission  is  not  persuaded  that  any  such  databases  would  include 


 all  numbers  covered  by  the  prohibition  at  47  U.  S.  C.    227(  b)(  1)(  A),  or  that  such  databases  are  sufficiently  accurate.  Assuming,  though,  that  predictive  dialers  can  be  programmed  to  avoid  calling  such  numbers,  there 
 would  be  no  reason  to  then  exclude  the  dialing  equipment  from  the  TCPAs  prohibition. 
78

 Federal  Communications  Commission  FCC  03-  153 
 79 
 consumers.  440  Coupled  with  the  fact  that  autodialers  can  dial  thousands  of  numbers  in  a  short  period  of  time,  calls  to  these  specified  categories  of  numbers  are  particularly  troublesome. 
 Therefore,  to  exclude  from  these  restrictions  equipment  that  use  predictive  dialing  software  from  the  definition  of  automated  telephone  dialing  equipment  simply  because  it  relies  on  a  given  set 
 of  numbers  would  lead  to  an  unintended  result.  Calls  to  emergency  numbers,  health  care  facilities,  and  wireless  numbers  would  be  permissible  when  the  dialing  equipment  is  paired  with 
 predictive  dialing  software  and  a  database  of  numbers,  but  prohibited  when  the  equipment  operates  independently  of  such  lists  and  software  packages.  We  believe  the  purpose  of  the 
 requirement  that  equipment  have  the  capacity  to  store  or  produce  telephone  numbers  to  be  called  is  to  ensure  that  the  prohibition  on  autodialed  calls  not  be  circumvented.  441  Therefore, 
 the  Commission  finds  that  a  predictive  dialer  falls  within  the  meaning  and  statutory  definition  of  automatic  telephone  dialing  equipment  and  the  intent  of  Congress.  442 


 134.  Predictive  Dialers  as  Customer  Premises  Equipment.  A  few  commenters  maintain  that  predictive  dialers  are  Customer  Premises  Equipment  (CPE)  443  over  which  the 
 Communications  Act  gives  the  FCC  exclusive  jurisdiction.  444  The  ATA  and  DMA  urge  the  Commission  to  assert  exclusive  authority  over  CPE  and,  in  the  process,  preempt  state  laws 
 governing  predictive  dialers.  They  contend  that,  in  the  absence  of  a  single  national  policy  on  predictive  dialer  use,  telemarketers  will  be  subject  to  the  possibility  of  conflicting  state 
 standards.  445  In  the  past,  CPE  was  regulated  as  a  common  carrier  service  based  on  the  Commissions  jurisdiction  and  statutory  responsibilities  over  carrier-  provided  equipment.  446 


 440  See  S.  REP.  NO.  102-  178  at  5  reprinted  in  1991  U.  S.  C.  C.  A.  N.  1968,  1972-  73  (1991)  (  The  Committee  believes 
 that  Federal  legislation  is  necessary  to  protect  the  public  from  automated  telephone  calls.  These  calls  can  be  an  invasion  of  privacy,  an  impediment  to  interstate  commerce,  and  a  disruption  to  essential  public  safety  services.). 


 441  See  47  U.  S.  C.    227(  a)(  1). 
 442  Because  the  statutory  definition  does  not  turn  on  whether  the  call  is  made  for  marketing  purposes,  we  also 
 conclude  that  it  applies  to  modems  that  have  the  capacity  (A)  to  store  or  produce  telephone  numbers  to  be  called,  using  a  random  or  sequential  number  generator;  and  (B)  to  dial  such  numbers.  See  47  U.  S.  C.    227(  a)(  1). 


 443  Customer  Premises  Equipment  is  defined  in  the  Communications  Act  as  equipment  employed  on  the  premises 
 of  a  person  (other  than  a  carrier)  to  originate,  route,  or  terminate  telecommunications.  See  47  U.  S.  C.    153(  14). 
 444  See  ATA  Comments  at  120;  ATA  Further  Comments  at  11-  12;  DMA  Reply  Comments  at  17;  WorldCom 
 Comments  at  41  (asserting  that  predictive  dialers  are  customer  premises  equipment). 
 445  See  ATA  Comments  at  120-  122  (noting  that  the  Commission  also  has  authority  to  forebear  from  adopting  a 
 specific  rule  governing  predictive  dialers  to  promote  marketplace  flexibility).  See  also  DMA  Comments  at  17  (  Predictive  dialers  are  customer  premises  equipment  (  CPE),  and  thus  beyond  the  states  power  to  regulate 


 pursuant  to  the  Communications  Act  of  1934  and  longstanding  Commission  rules  and  orders.  These  policies  apply  because  predictive  dialers  are  used  interchangeably  and  inseparably  for  both  inter-  and  intrastate 
 communications,  and  are  not  susceptible  to  a  segregated  regulatory  framework  that  would  govern  inter-  and  intrastate  uses  separately.);  DMA  Further  Comments  at  4. 


 446  See  Amendment  of  Section  64.702  of  the  Commissions  Rules  and  Regulations  (Second  Computer  Inquiry), 
 Docket  No.  20828,  77  FCC2d  384,  Final  Decision  (1980)  (Computer  II).  In  the  Computer  II  Order,  the  Commission  explained  that    In  conferring  jurisdiction  upon  this  agency  over  all  instrumentalities  .  .  .  incidental 


 to  .  .  .  transmission,    the  intent  was  .  .  .  to  give  the  FCC  ability  to  regulate  any  charge  or  practice  associated  with  a  (continued.) 
79

 Federal  Communications  Commission  FCC  03-  153 
 80 
 The  Commission  long  ago  deregulated  CPE,  finding  that  the  CPE  market  was  becoming  increasingly  competitive,  and  that  in  order  to  increase  further  the  options  that  consumers  had  in 
 obtaining  equipment,  it  would  require  common  carriers  to  separate  the  provision  of  CPE  from  the  provision  of  telecommunications  services.  447  As  part  of  its  review  of  CPE  regulations,  the 
 Commission  pointed  out  that  it  had  never  regarded  the  provision  of  terminal  equipment  in  isolation  as  an  activity  subject  to  Title  II  regulation.  448  While  the  Commission  recognized  that 
 such  equipment  is  within  the  FCCs  authority  over  wire  and  radio  communications,  449  it  found  that  the  equipment,  by  itself,  is  not  a  communication  service,  and  therefore  there  was  no 
 mandate  that  it  be  regulated.  450  None  of  the  commenters  who  argue  this  point  describe  a  change  in  circumstances  that  would  warrant  reevaluating  the  Commissions  earlier  determination  and 
 risk  disturbing  the  competitive  balance  the  Commission  deemed  appropriate  in  1980.  451  In  addition,  it  is  not  the  equipment  itself  that  states  are  considering  regulating;  it  is  the  use  of  such 
 equipment  that  has  caught  the  attention  of  some  state  legislatures.  452  We  believe  it  is  preferable  at  this  time  to  regulate  the  use  of  predictive  dialers  under  the  TCPAs  specific  authority  to 
 regulate  telemarketing  practices.  Therefore,  we  decline  to  preempt  state  laws  governing  the  use  of  predictive  dialers  and  abandoned  calls  or  to  regulate  predictive  dialers  as  CPE. 


 (Continued  from  previous  page)  common  carrier  service  in  order  to  insure  that  the  carrier  operated  for  the  public  benefit.    See  Computer  II,  77 
 FCC2d  at  450,  para.  170. 
 447  Computer  II,  77  FCC2d  at  442-  43,  para.  149;  see  also  In  the  Matter  of  Policy  and  Rules  Concerning  the 
 Interstate,  Interexchange  Marketplace,  Report  and  Order,  CC  Docket  Nos.  96-  91  and  98-  183,  16  FCC  Rcd  7418,  7422,  para.  5  (March  30,  2001). 


 448  Computer  II,  77  FCC2d  at  451,  para.  172.  The  Commission  explained  that  [  e]  quipment  manufacturers, 
 distributors,  and  even  regulated  carriers  routinely  offer  terminal  equipment  for  sale  or  lease  on  an  untariffed  basis. 


 449  See  Computer  II,  77  FCC2d  at  451-  52,  paras.  172-  173.  ([  S]  uch  activities  are  not  necessarily  beyond  the 
 jurisdiction  of  the  Commission  to  the  extent  they  are  encompassed  within  the  definition  of  wire  or  radio  communications  in  Section  3(  a)  of  the  Act.  The  definitions  of  wire  and  radio  communications  in  Section  3(  a)  and 


 (b)  are  far-  reaching  and  include  all  instrumentalities,  facilities,  apparatus,  and  services  incidental  to  such  transmission.    Indeed  we  explicitly  find  that  all  terminal  equipment  used  with  interstate  communications 
 services  are  within  the  Acts  definition  of  wire  and  radio  communications.  However,  the  fact  that  the  provision  of  incidental  instrumentalities,    etc.  is  within  the  subject  matter  jurisdiction  of  the  Act  does  not  mandate  regulation 
 of  the  instrumentalities.  )  (footnotes  omitted). 
 450  Computer  II,  77  FCC2d  at  451-  452,  para.  173. 


 451  The  Commission  earlier  stated  that  [  a]  ny  regulation  by  tariff  or  otherwise  of  terminal  equipment  must  be 
 demonstrated  to  be  reasonably  ancillary  to  the  effective  performance  of  the  Commissions  responsibilities  under  Title  II  or  imperative  for  the  achievement  of  an  agencys  ultimate  purposes.  )  Computer  II,  77  FCC  Rcd  at  451- 


 52,  para.  173. 
 452  See  Private  Citizen  Comments  at  7  (  California  will  be  implementing  a  1%  abandonment  rate  soon.);  HFS  at 
 7  (  California  adopted  legislation  requiring  a  maximum  for  abandoned  calls,  but  the  regulatory  body  charged  with  setting  the  maximum  has,  to  our  knowledge,  been  unable  to  establish  a  maximum  yet.).  Oklahoma  bans  the  use 


 of  automatic  or  predictive  dialing  devices  that  abandon  more  than  5%  of  calls  answered  per  day  per  telemarketing  campaign.  See  Okla.  Stat.  tit.  15,  755.1  (2002).  Virginia  failed  to  pass  legislation  proposing  to  regulate  the  use 
 of  predictive  dialers.  See  S.  B.  918,  2003  Gen.  Assem.  (Va.  2003). 
80

 Federal  Communications  Commission  FCC  03-  153 
 81 
 2.  War  Dialing 
 135.  In  the  2002  Notice,  the  Commission  sought  comment  on  the  practice  of  using  autodialers  to  dial  large  blocks  of  telephone  numbers  in  order  to  identify  lines  that  belong  to 


 telephone  facsimile  machines.  Of  those  commenters  who  weighed  in  on  war  dialing,  453  there  was  unanimous  support  for  a  ban  on  the  practice.  454  Commenters  explained  that  ringing  a 
 telephone  for  the  purpose  of  determining  whether  the  number  is  associated  with  a  fax  or  voice  line  is  an  invasion  of  consumers  privacy  interests  and  should  be  prohibited.  Moreover,  they 
 asserted  there  is  no  free  speech  issue  when  the  caller  has  no  intention  of  speaking  with  the  called  party.  455  The  TCPA  prohibits  the  transmission  of  unsolicited  facsimile  advertisements  absent  the 
 consent  of  the  recipient.  The  Commission  agrees  that  because  the  purpose  of  war  dialing  is  to  identify  those  numbers  associated  with  facsimile  machines,  the  practice  serves  few,  if  any, 
 legitimate  business  interests  and  is  an  intrusive  invasion  of  consumers  privacy.  Therefore,  the  Commission  today  adopts  a  rule  that  prohibits  the  practice  of  using  any  technology  to  dial  any 
 telephone  number  for  the  purpose  of  determining  whether  the  line  is  a  fax  or  voice  line.  456 
 IX.  ARTIFICIAL  OR  PRERECORDED  VOICE  MESSAGES 
 A.  Background 
 136.  As  described  above,  the  TCPA  and  Commission  rules  prohibit  telephone  calls  to  residences  using  an  artificial  or  prerecorded  voice  to  deliver  a  message  without  the  prior  express 


 consent  of  the  called  party,  unless  the  call  is  for  emergency  purposes  or  is  specifically  exempted.  457  The  TCPA  permits  the  Commission  to  exempt  from  this  provision  calls  which  are 
 non-  commercial  and  commercial  calls  which  do  not  adversely  affect  the  privacy  rights  of  the  called  party  and  which  do  not  transmit  an  unsolicited  advertisement.  458  In  its  1992  proceeding, 
 the  Commission  determined  to  exempt  calls  that  are  non-  commercial  and  commercial  calls  that  do  not  contain  an  unsolicited  advertisement,  noting  that  messages  that  do  not  seek  to  sell  a 
 product  or  service  do  not  tread  heavily  upon  the  consumer  interests  implicated  by  section  227.  459 


 453  In  this  context,  war  dialing  uses  automated  equipment  to  dial  telephone  numbers,  generally  sequentially,  and 
 software  to  determine  whether  each  number  is  associated  with  a  fax  line  or  voice  line. 
 454  See  Thomas  M.  Pechnik  Comments  at  6;  PRC  Comments  at  4-  5;  Michael  C.  Worsham  Comments  at  5;  Carl 
 Paulson  Comments;  Wayne  G.  Strang  Reply  Comments  at  21. 
 455  See,  e.  g.,  Thomas  M.  Pechnik  Comments  at  5;  Wayne  G.  Strang  Reply  Comments  at  21. 


 456  See  amended  rule  at  47  C.  F.  R.    64.1200(  a)(  7). 
 457  47  U.  S.  C.    227(  b)(  1)(  B);  47  C.  F.  R.    64.1200(  a)(  2). 
 458  47  U.  S.  C.    227(  b)(  2)(  B). 
 459  See  1992  NPRM,  7  FCC  Rcd  at  2737,  para.  11.  Among  the  examples  of  calls  that  do  not  include  the 
 transmission  of  any  unsolicited  advertisement,  the  Commission  cited  calls  from  a  business  that  wishes  to  advise  its  employees  of  a  late  opening  time  due  to  weather;  or  calls  from  a  nationwide  organization  that  wishes  to  remind 


 members  of  an  upcoming  meeting  or  change  in  schedule;  or  calls  from  a  catalogue  or  delivery  company  to  confirm  the  arrival,  shipment,  or  delivery  date  of  a  product  to  a  customer.  We  reiterate  that  such  calls  also  would 
 (continued.) 
81

 Federal  Communications  Commission  FCC  03-  153 
 82 
 The  Commission  also  concluded  that  a  solicitation  to  someone  with  whom  a  prior  business  relationship  exists  does  not  adversely  affect  subscriber  privacy  interests,  and  adopted  an 
 exemption  for  prerecorded  messages  delivered  to  consumers  with  whom  a  company  has  an  established  business  relationship.  460  Finally,  the  Commission  concluded  that  tax-  exempt 
 nonprofit  organizations  should  be  exempt  from  the  prohibition  on  prerecorded  message  calls  to  residences  as  non-  commercial  calls.  461  In  the  2002  Notice,  the  Commission  sought  comment  on 
 artificial  or  prerecorded  messages  containing  offers  for  free  goods  or  services  and  messages  purporting  to  provide  information  only  about  products  or  services.  We  also  invited  comment 
 on  calls  seeking  people  to  help  sell  or  market  a  business  products.  We  asked  whether  such  messages  should  be  viewed  as  advertisements  under  the  rules. 


 137.  The  record  reveals  that  the  practice  of  sending  prerecorded  messages  to  residential  telephone  lines  is  widespread.  462  Consumers  are  frustrated  by  such  messages,  which 
 often  fill  up  the  tapes  of  their  answering  machines,  463  fail  to  identify  adequately  the  company  delivering  the  message,  and  provide  no  option  for  requesting  that  the  company  not  call  again.  464 
 When  consumers  attempt  to  place  their  numbers  on  a  do-  not-  call  list  in  response  to  a  prerecorded  message,  they  often  reach  busy  signals,  465  additional  prerecorded  messages,  or  are  told  that  do-not- 
 call  requests  are  not  processed  at  that  number.  466  Consumers  also  indicate  that  they  have  been  told  by  telemarketers  that  free  offers  and  informational  messages  are  not  subject  to  the 
 prerecorded  message  prohibition,  as  they  do  not  ask  the  called  party  to  purchase  any  product  or  service.  467 


 138.  The  majority  of  consumers  and  consumer  groups  contend  that  messages  offering  free  goods  or  services  or  those  that  claim  to  provide  information-  only  are  designed  with  the 
 ultimate  goal  of  soliciting  consumers  to  buy  products  and  services  and  are  therefore  prohibited 
 (Continued  from  previous  page)  typically  be  covered  by  the  exemption  for  an  established  business  relationship.  See  amended  47  C.  F.  R.   
 64.1200(  f)(  3). 
 460  1992  TCPA  Order,  7  FCC  Rcd  at  8770-  71,  para.  34. 


 461  1992  TCPA  Order,  7  FCC  Rcd  at  8773-  74,  para.  40. 
 462  NAAG  Comments  at  33  (  The  telephone  records  subpoenaed  for  one  autodialing  telemarketer  revealed  the 
 business  was  using  47  lines  to  leave  messages  that  lasted  less  than  30  seconds.  Considering  that  calls  could  be  placed  over  at  least  a  14-  hour  period,  the  equipment  could  leave  more  than  half  a  million  calls  per  week.);  Wayne 


 G.  Strang  Comments  at  5;  Mathemaesthetics  Comments  at  7;  Philip  J.  Charvat  Comments  at  5. 
 463  Michael  Sprinker  Comments;  Dale  Carson  Comments;  Judith  Hanes  Comments;  Jean  Armstrong  Comments; 
 NACAA  Comments  at  2-  3. 
 464  See,  e.  g.,  NACAA  Comments  at  2-  3;  Tom  Burch  Comments;  James  D.  Gagnon  Comments;  Neil  J.  Nitzberg 
 Comments  at  1;  John  Cox  Comments;  NYSCPB    Other  Than  DNC  List  Comments  at  2. 
 465  Debra  Denson-  Royal  Oak  Comments. 


 466  Dennis  C.  Brown  December  6,  2002  Comments  at  4;  David  Purk  Comments. 
 467  See,  e.  g.,  NCL  Comments  at  5. 
82

 Federal  Communications  Commission  FCC  03-  153 
 83 
 without  the  prior  express  consent  of  the  called  party.  468  These  messages,  they  argue,  are  intended  to  generate  future  sales,  and  the  fact  that  no  sale  occurs  during  the  call  is  irrelevant  to 
 their  intrusiveness.  469  Industry  members  provided  very  few  examples  of  prerecorded  messages  used  to  deliver  advertisements.  Instead,  they  described  the  benefits  of  communicating  with 
 existing  customers  through  prerecorded  messages.  Commenters  specifically  cautioned  the  Commission  against  restricting  dual  purpose  calls  which,  they  contend,  provide  both  a 
 convenient  customer  service  and  cost  effective  marketing  tool.  470  One  company  explained  that  it  uses  prerecorded  messages  to  notify  its  customers  about  delinquent  bills  or  changes  in  service, 
 and  to  simultaneously  inform  them  of  alternative  services  and  products.  471  Another  commenter  described  messages  sent  by  a  mortgage  broker  alerting  homeowners  to  lower  interest  rates  and 
 offering  refinancing  options.  472 
 B.  Discussion 
 1.  Offers  for  Free  Goods  or  Services;  Information-  Only  Messages 
 139.  Congress  found  that  residential  telephone  subscribers  consider  automated  or  prerecorded  telephone  calls  .  .  .  to  be  a  nuisance  and  an  invasion  of  privacy.  473  It  also  found  that 


 [  b]  anning  such  automated  or  prerecorded  telephone  calls  to  the  home,  except  when  the  receiving  party  consents  to  receiving  the  call  or  when  such  calls  are  necessary  in  an  emergency 
 situation  affecting  the  health  and  safety  of  the  consumer,  is  the  only  effective  means  of  protecting  telephone  consumers  from  this  nuisance  and  privacy  invasion.  474  Congress 
 determined  that  such  prerecorded  messages  cause  greater  harm  to  consumers  privacy  than  telephone  solicitations  by  live  telemarketers.  The  record  reveals  that  consumers  feel  powerless 
 to  stop  prerecorded  messages  largely  because  they  are  often  delivered  to  answering  machines  and  because  they  do  not  always  provide  a  means  to  request  placement  on  a  do-  not-  call  list. 


 468  NCL  Comments  at  5;  Thomas  Pechnik  Comments  at  8;  TOPUC  Comments  at  4-  5;  Michael  C.  Worsham 
 Comments  at  9;  City  of  New  Orleans  Comments  at  8;  J.  Melville  Capps  Comments  at  6-  7;  NAAG  Comments  at  37;  NYSCPB  Comments  at  12;  S.  Abramson  Comments  at  4;  NACAA  Comments  at  4;  Wayne  G.  Strang 


 Comments  at  16;  Philip  J.  Charvat  Comments  at  7;  EPIC  Comments  at  13. 
 469  See,  e.  g.,  NAAG  Comments  at  36-  37;  TOPUC  Comments  at  5;  J.  Melville  Capps  Comments  at  6;  NYSCPB 
 Comments  at  12.  See  also  NAAG  at  33,  n.  108  (describing  a  prerecorded  message  received  by  many  state  attorneys  general  offices  which  invited  the  called  party  to  call  an  800  number  to  participate  in  Disneys  100  th 


 Anniversary  celebration  by  visiting  south  Florida  for  a  cost  of  $99  per  person  for  three  days);  NAAG  at  37  (describing  another  message  that  advertised  a  revolutionary  new  product  and  asked  consumers  to  attend  a  local 
 meeting  to  learn  how  to  make  a  six-  figure  income.  At  the  meeting,  consumers  are  encouraged  to  purchase  new  products  for  resale.) 


 470  Wells  Fargo  Comments  at  2;  HFS  Comments  at  8;  AT&  T  Wireless  Comments  at  27-  28. 
 471  Wells  Fargo  Comments  at  2;  see  also  AT&  T  Wireless  Comments  at  27-  28. 
 472  Joe  Shields  Reply  Comments  at  6-  7. 
 473  TCPA,  Section  2(  10),  reprinted  in  7  FCC  Rcd  at  2744. 
 474  TCPA,  Section  2(  12),  reprinted  in  7  FCC  Rcd  at  2744-  45. 
83

 Federal  Communications  Commission  FCC  03-  153 
 84 
 140.  Additionally,  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  persons  prior  express  invitation  or  permission.  475  The  TCPAs  definition  does  not  require  a  sale  to  be  made  during  the  call  in  order  for  the  message  to 
 be  considered  an  advertisement.  Offers  for  free  goods  or  services  that  are  part  of  an  overall  marketing  campaign  to  sell  property,  goods,  or  services  constitute  advertising  the  commercial 
 availability  or  quality  of  any  property,  goods,  or  services.  476  Therefore,  the  Commission  finds  that  prerecorded  messages  containing  free  offers  and  information  about  goods  and  services  that 
 are  commercially  available  are  prohibited  to  residential  telephone  subscribers,  if  not  otherwise  exempted.  477 


 141.  In  addition,  we  amend  the  prerecorded  message  rule  at  47  C.  F.  R.    64.1200(  c)(  2)  so  that  the  prohibition  expressly  applies  to  messages  that  constitute  telephone  solicitations,  as 
 well  as  to  those  that  include  or  introduce  an  unsolicited  advertisement.  478  We  agree  with  those  commenters  who  suggest  that  application  of  the  prerecorded  message  rule  should  turn,  not  on  the 
 callers  characterization  of  the  call,  but  on  the  purpose  of  the  message.  479  Amending  the  rule  to  apply  to  messages  that  constitute  telephone  solicitations,  is  consistent  with  the  goals  of  the 
 TCPA  480  and  addresses  the  concerns  raised  by  commenters  about  purported  free  offers.  481  In  addition,  we  believe  the  amended  rule  will  afford  consumers  a  greater  measure  of  protection 
 from  unlawful  prerecorded  messages  and  better  inform  the  business  community  about  the  general  prohibition  on  such  messages.  482 


 142.  The  so-  called  dual  purpose  calls  described  in  the  record  calls  from  mortgage 
 475  47  U.  S.  C.    227(  a)(  4);  47  C.  F.  R.    64.1200(  f)(  5). 
 476  See  47  U.  S.  C.    227(  a)(  4). 
 477  Therefore,  a  prerecorded  message  that  contains  language  describing  a  new  product,  a  vacation  destination,  or  a 
 company  that  will  be  in  your  area  to  perform  home  repairs,  and  asks  the  consumer  to  call  a  toll-  free  number  to  learn  more,  is  an  unsolicited  advertisement  under  the  TCPA  if  sent  without  the  called  partys  express 


 invitation  or  permission.  See  47  U.  S.  C.    227(  a)(  4).  However,  as  long  as  the  message  is  limited  to  identification  information  only,  such  as  name  and  telephone  number,  it  will  not  be  considered  an  unsolicited  advertisement 
 under  our  rules.  See  FTC  Further  Comments  at  32.  But  see  Joe  Shields  Further  Comments  at  4-  5  (arguing  that  all  prerecorded  messages  that  introduce  a  business  are  by  definition  an  advertisement). 


 478  The  current  rule  exempts  from  the  prohibition  any  call  that  is  made  for  a  commercial  purpose  but  does  not 
 include  the  transmission  of  any  unsolicited  advertisement.  See  47  C.  F.  R.    64.1200(  c)(  2).  We  amend  the  rule  to  exempt  a  call  that  is  made  for  a  commercial  purpose  but  does  not  include  or  introduce  an  unsolicited 


 advertisement  or  constitute  a  telephone  solicitation.  See  amended  rule  at  47  C.  F.  R.    64.1200(  a)(  2)(  iii). 
 479  See,  e.  g.,  NAAG  Comments  at  43. 


 480  See  TCPA,  Section  2(  12)  and  (13),  reprinted  in  7  FCC  Rcd  at  2744-  45. 
 481  See,  e.  g.,  Michael  Worsham  Comments  at  9;  Stewart  Abramson  Comments;  City  of  New  Orleans  Comments  at 
 8;  J.  Melville  Capps  Comments  at  6. 
 482  See  2002  Notice,  17  FCC  Rcd  at  17478,  para.  31. 
84

 Federal  Communications  Commission  FCC  03-  153 
 85 
 brokers  to  their  clients  notifying  them  of  lower  interest  rates,  calls  from  phone  companies  to  customers  regarding  new  calling  plans,  or  calls  from  credit  card  companies  offering  overdraft 
 protection  to  existing  customers  would,  in  most  instances,  constitute  unsolicited  advertisements,  regardless  of  the  customer  service  element  to  the  call.  483  The  Commission 
 explained  in  the  2002  Notice  that  such  messages  may  inquire  about  a  customers  satisfaction  with  a  product  already  purchased,  but  are  motivated  in  part  by  the  desire  to  ultimately  sell 
 additional  goods  or  services.  If  the  call  is  intended  to  offer  property,  goods,  or  services  for  sale  either  during  the  call,  or  in  the  future  (such  as  in  response  to  a  message  that  provides  a  toll-  free 
 number),  that  call  is  an  advertisement.  Similarly,  a  message  that  seeks  people  to  help  sell  or  market  a  business  products,  constitutes  an  advertisement  if  the  individuals  called  are 
 encouraged  to  purchase,  rent,  or  invest  in  property,  goods,  or  services,  during  or  after  the  call.  However,  the  Commission  points  out  that,  if  the  message  is  delivered  by  a  company  that  has  an 
 established  business  relationship  with  the  recipient,  it  would  be  permitted  under  our  rules.  We  also  note  that  absent  an  established  business  relationship,  the  telemarketer  must  first  obtain  the 
 prior  express  consent  of  the  called  party  in  order  to  lawfully  initiate  the  call.  Purporting  to  obtain  consent  during  the  call,  such  as  requesting  that  a  consumer  press  1  to  receive  further 
 information,  does  not  constitute  the  prior  consent  necessary  to  deliver  the  message  in  the  first  place,  as  the  request  to  press  1  is  part  of  the  telemarketing  call. 


 2.  Identification  Requirements 
 143.  The  TCPA  rules  require  that  all  artificial  or  prerecorded  messages  delivered  by  an  automatic  telephone  dialing  system  identify  the  business,  individual,  or  other  entity  initiating  the 


 call,  and  the  telephone  number  or  address  of  such  business,  individual  or  other  entity.  484  Additionally,  the  Commissions  rules  contain  identification  requirements  that  apply  without 
 limitation  to  any  telephone  solicitation  to  a  residential  telephone  subscriber.  485  The  term  telephone  solicitation  is  defined  to  mean  the  initiation  of  a  telephone  call  or  message  for  the 
 purpose  of  encouraging  the  purchase  or  rental  of  .  .  .  property,  goods,  or  services  .  .  .  (emphasis  added).  486  We  sought  comment,  however,  on  whether  we  should  modify  our  rules  to  state 
 expressly  that  the  identification  requirements  apply  to  otherwise  lawful  artificial  or  prerecorded  messages,  as  well  as  to  live  solicitation  calls.  487 


 144.  The  vast  majority  of  consumer  and  industry  commenters  support  modifying  the  rules  to  provide  expressly  that  telemarketers  must  comply  with  the  identification  requirements 
 when  delivering  prerecorded  messages.  488  Some  consumers  urge  the  Commission  to  require 
 483  Wayne  G.  Strang  Reply  Comments  at  6-  7. 
 484  See  47  C.  F.  R.    64.1200(  d). 
 485  47  C.  F.  R.    64.1200(  e)(  2)(  iv). 
 486  47  C.  F.  R.    64.1200(  f)(  3). 
 487  2002  Notice,  17  FCC  Rcd  at  17476-  77,  para.  28. 
 488  AT&  T  Wireless  Comments  at  23;  ARDA  Comments  at  9;  ABA  Comments  at  4;  Stewart  Abramson  Comments 
 at  3;  NCL  Comments  at  4;  Carl  Paulson  Comments. 
85

 Federal  Communications  Commission  FCC  03-  153 
 86 
 specifically  that  companies  provide  the  name  of  the  company  under  which  it  is  registered  to  do  business.  489  They  explain  that  a  company  will  often  use  a  d/  b/  a  (  doing  business  as)  or 
 alias  in  the  text  of  the  prerecorded  message,  making  it  difficult  to  identify  the  company  calling.  The  Commission  recognizes  that  adequate  identification  information  is  vital  so  that 
 consumers  can  determine  the  purpose  of  the  call,  possibly  make  a  do-  not-  call  request,  and  monitor  compliance  with  the  TCPA  rules.  490  Therefore,  we  are  amending  our  rules  to  expressly 
 require  that  all  prerecorded  messages,  whether  delivered  by  automated  dialing  equipment  or  not,  identify  the  name  of  the  business,  individual  or  other  entity  that  is  responsible  for  initiating  the 
 call,  along  with  the  telephone  number  of  such  business,  other  entity,  or  individual.  491  With  respect  to  the  callers  name,  the  prerecorded  message  must  contain,  at  a  minimum,  the  legal 
 name  under  which  the  business,  individual  or  entity  calling  is  registered  to  operate.  The  Commission  recognizes  that  some  businesses  use  d/  b/  as  or  aliases  for  marketing  purposes. 
 The  rule  does  not  prohibit  the  use  of  such  additional  information,  provided  the  legal  name  of  the  business  is  also  stated.  The  rule  also  requires  that  the  telephone  number  stated  in  the  message  be 
 one  that  a  consumer  can  use  during  normal  business  hours  to  ask  not  to  be  called  again.  492  If  the  number  provided  in  the  message  is  that  of  a  telemarketer  hired  to  deliver  the  message,  the 
 company  on  whose  behalf  the  message  is  sent  is  nevertheless  liable  for  failing  to  honor  any  do-not-  call  request.  This  is  consistent  with  the  rules  on  live  solicitation  calls  by  telemarketers.  493  If 
 a  consumer  asks  not  to  be  called  again,  the  telemarketer  must  record  the  do-  not-  call  request,  and  the  company  on  whose  behalf  the  call  was  made  must  honor  that  request. 


 3.  Radio  Station  and  Television  Broadcaster  Calls 
 145.  The  TCPA  prohibits  the  delivery  of  prerecorded  messages  to  residential  telephone  lines  without  the  prior  express  consent  of  the  called  party.  494  Commission  rules  exempt  from  the 


 prohibition  calls  that  are  made  for  a  commercial  purpose  but  do  not  include  any  unsolicited  advertisement.  495  The  Commission  sought  comment  on  prerecorded  messages  sent  by  radio 


 489  City  of  New  Orleans  Comments  at  8;  NCL  Comments  at  4;  PRC  Comments  at  5-  6. 
 490  See,  e.  g.,  Carl  Paulson  Comments;  City  of  New  Orleans  Comments  at  7-  8;  Joe  Shields  Reply  Comments  at  6-  7. 
 491  See  amended  47  C.  F.  R.    64.1200(  b). 
 492  This  would  be  9  a.  m.    5  p.  m.,  Monday  through  Friday,  during  the  particular  telemarketing  campaign.  A  seller 
 or  telemarketers  telephone  number  must  permit  consumers  to  make  their  do-  not-  call  requests  in  a  timely  manner.  Therefore,  the  seller  or  telemarketer  must  staff  the  do-  not-  call  number  sufficiently  or  use  an  automated  system 


 for  processing  requests  in  such  a  way  that  consumers  are  not  placed  on  hold  or  forced  to  wait  for  an  agent  to  answer  the  connection  for  an  unreasonable  length  of  time.  We  also  reiterate  the  Commissions  determination  in 
 its  1995  Reconsideration  Order  that  any  number  provided  for  identification  purposes  may  not  be  a  number  that  requires  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).  See  1995  Reconsideration  Order,  10  FCC  Rcd  at  12409,  para.  38.  See  also  amended  47  C.  F.  R.    64.1200(  b)(  2). 


 493  See  amended  47  C.  F.  R.    64.1200(  d)(  3). 
 494  47  U.  S.  C.    227(  b)(  1)(  B). 
 495  47  C.  F.  R.    64.1200(  c)(  2). 
86

 Federal  Communications  Commission  FCC  03-  153 
 87 
 stations  or  television  broadcasters  that  encourage  telephone  subscribers  to  tune  in  at  a  particular  time  for  a  chance  to  win  a  prize  or  similar  opportunity.  496  We  asked  whether  the  Commission 
 should  specifically  address  these  kinds  of  calls,  and  if  so,  how.  The  record  reveals  that  such  calls  by  radio  stations  and  television  broadcasters  do  not  at  this  time  warrant  the  adoption  of  new 
 rules.  Few  commenters  in  this  proceeding  described  either  receiving  such  messages  or  that  they  were  particularly  problematic.  497  The  few  commenters  who  addressed  the  issue  were  split  on 
 whether  such  messages  fall  within  the  TCPAs  definition  of  unsolicited  advertisement  and  are  thus  subject  to  the  restrictions  on  their  delivery.  498  We  conclude  that  if  the  purpose  of  the 
 message  is  merely  to  invite  a  consumer  to  listen  to  or  view  a  broadcast,  such  message  is  permitted  under  the  current  rules  as  a  commercial  call  that  does  not  include  the  transmission  of 
 any  unsolicited  advertisement  and  under  the  amended  rules  as  a  commercial  call  that  does  not  include  or  introduce  an  unsolicited  advertisement  or  constitute  a  telephone  solicitation.  499  The 
 Commission  reiterates,  however,  that  messages  that  are  part  of  an  overall  marketing  campaign  to  encourage  the  purchase  of  goods  or  services  or  that  describe  the  commercial  availability  or 
 quality  of  any  goods  or  services,  are  advertisements  as  defined  by  the  TCPA.  Messages  need  not  contain  a  solicitation  of  a  sale  during  the  call  to  constitute  an  advertisement. 


 X.  ABANDONED  CALLS 
 A.  Background 
 146.  In  the  2002  Notice,  the  Commission  noted  that  various  technologies  are  widely  used  by  telemarketers  to  contact  greater  numbers  of  consumers  more  efficiently.  500  We 


 explained  that  the  use  of  one  such  technology  predictive  dialing  software  may  result  in  a  significant  number  of  abandoned  calls.  501  Predictive  dialers  initiate  phone  calls  while 
 telemarketers  are  talking  to  other  consumers  and  frequently  disconnect  those  calls  when  a 


 496  2002  Notice,  17  FCC  Rcd  at  17478-  79,  para.  32. 
 497  NYSCPB  states  that  they  have  not  received  complaints  on  these  types  of  messages  by  radio  and  television 
 stations.  See  NYSCPB  Comments  at  13. 
 498  Thomas  Pechnik  Comments  at  9  (prerecorded  messages  sent  by  radio  stations  are  commercial  ads  covered  by 
 the  TCPA);  Hershovitz  Comments  at  3-  4  (such  messages  clearly  prohibited  under  the  TCPA);  NAB  Comments  at  3  (broadcaster  audience  invitation  calls  do  not  promote  the  commercial  availability  or  quality  of  property,  goods 


 or  services  and  are  therefore  exempted  under  TCPA  rules);  TBT  Comments  at  1  (invitation  to  listen  to  a  radio  station  is  not  a  solicitation  as  defined  by  FCC);  Michael  C.  Worsham  Comments  at  9  (true  purpose  of  call  is  not 
 charitable  or  political);  Wayne  G.  Strang  Reply  Comments  at  13-  14  (calls  made  to  increase  listener/  viewer  shares  are  commercial  in  nature,  even  though  no  sale  was  made  or  was  intended  to  be  made);  Shaw  Further  Comments  at 
 4  (calls  to  invite  a  consumer  to  listen  to  a  radio  station  are  regulated  by  the  TCPA  and  may  not  be  made  to  numbers  on  the  do-  not-  call  list). 


 499  See  amended  47  C.  F.  R.    64.1200(  a)(  2)(  iii).  However,  messages  that  encourage  consumers  to  listen  to  or 
 watch  programming,  including  programming  that  is  retransmitted  broadcast  programming  for  which  consumers  must  pay  (e.  g.,  cable,  digital  satellite,  etc.),  would  be  considered  advertisements  for  purposes  of  our  rules. 


 500  2002  Notice,  17  FCC  Rcd  at  17473-  74,  para.  24. 
 501  See  supra  note  31  for  a  description  of  a  predictive  dialer. 
87

 Federal  Communications  Commission  FCC  03-  153 
 88 
 telemarketer  is  unavailable  to  take  the  next  call.  In  attempting  to  predict  the  average  time  it  takes  for  a  consumer  to  answer  the  phone  and  when  a  telemarketer  will  be  free  to  take  the  next 
 call,  predictive  dialers  may  either  hang-  up  on  consumers  or  keep  the  consumer  on  hold  until  connecting  the  call  to  a  sales  representative,  resulting  in  what  has  been  referred  to  as  dead 
 air.  502  Predictive  dialers  reduce  the  amount  of  down  time  for  sales  agents,  as  consumers  are  more  likely  to  be  on  the  line  when  the  telemarketer  completes  a  call.  Each  telemarketing 
 company  can  set  its  predictive  dialer  software  for  a  predetermined  abandonment  rate.  503  The  higher  the  abandonment  rate,  the  higher  the  number  of  hang-  up  calls.  The  Commission  asked 
 what  approaches  we  might  take  to  minimize  the  harm  that  results  from  the  use  of  predictive  dialers.  504  We  invited  comment  specifically  on  the  possibility  of  setting  a  maximum  rate  on  the 
 number  of  abandoned  calls.  505 
 147.  The  record  shows  that  the  use  of  predictive  dialers  has,  in  fact,  become  more  prevalent  in  the  telemarketing  industry.  506  The  record  also  reveals  that  predictive  dialers  are 


 responsible  for  the  vast  majority  of  abandoned  telemarketing  calls  both  hang-  ups  and  dead  air  calls.  Individual  consumers  report  receiving  between  three  and  ten  hang-  up  calls  each 
 day.  507  Consumers  often  feel  harassed  or  aggravated  by  dead  air  calls.  508  Many  describe  the  burdens  these  calls  impose  on  individuals  with  disabilities,  who  often  struggle  to  answer  the 
 telephone.  509  Hang-  ups  and  dead  air  calls  also  can  be  frightening  for  the  elderly.  510  Consumers  complain  that  they  do  not  have  an  opportunity  to  request  placement  on  a  companys  do-  not-  call 


 502  Dead  air  may  also  be  the  result  of  Answering  Machine  Detection  (AMD)  software  which  is  used  to 
 determine  whether  the  call  has  reached  a  live  person  or  an  answering  machine.  AMD  may  be  programmed  to  have  a  certain  amount  of  time  in  which  to  determine  whether  an  answering  machine  or  live  person  has  answered 


 the  call.  During  this  time,  the  consumer  may  experience  dead  air  until  either  the  dialer  transfers  the  called  party  to  a  sales  agent  or  disconnects  the  call.  See  ECN  Comments  at  3-  4;  Alek  Szlam  Comments  at  4. 


 503  See  2002  Notice,  17  FCC  Rcd  at  17465,  para.  7,  n.  38. 
 504  See  2002  Notice,  17  FCC  Rcd  at  17475,  para.  26. 
 505  2002  Notice,  17  FCC  Rcd  at  17475-  76,  para.  26. 
 506  See,  e.  g.,  NACAA  Comments  at  3;  Pacesetter  Comments  at  5;  WorldCom  Comments  at  41.  We  note  that  the 
 vast  majority  of  commenters  that  engage  in  telemarketing  described  their  use  of  predictive  dialers. 
 507  See,  e.  g.,  F.  Jenny  Holder  Comments  at  1;  Caroline  Henriques  Comments. 


 508  See,  e.  g.,  NCL  Comments  at  4  (  It  is  the  equivalent  of  sending  3  door-  to-  door  salespeople  to  a  neighborhood 
 with  twenty  homes,  using  a  remote  technology  to  knock  on  all  the  doors  at  once,  and  leaving  seventeen  homeowners  standing  at  their  doors  wondering  who  was  there.);  NACAA  Comments  at  3-  4;  TOPUC  Comments 


 at  3;  NAAG  Comments  at  34;  Edwin  Bailey  Hathaway  Comments  at  1;  Stewart  Abramson  Comments  at  1;  Kent  Rausch  Comments  (worries  that  when  his  children  answer  the  phone,  there  is  a  predator  on  the  other  end  of  the 
 line). 
 509  See,  e.  g.,  Thomas  Callahan  Comments;  Vivian  Sinclair  Comments;  Carmen  Brown  Comments  (caretaker  of 
 husband  with  MS);  Henry  Jackson  Comments. 
 510  See,  e.  g.,  Edwin  Bailey  Hathaway  Comments;  Karen  M.  Meyer  Comments;  AARP  Comments  at  2. 
88

 Federal  Communications  Commission  FCC  03-  153 
 89 
 list  when  predictive  dialers  disconnect  calls.  511  Abandoned  calls  can  also  interfere  with  Internet  usage  or  simply  tie-  up  telephone  lines  for  people  telecommuting  or  operating  businesses  out  of 
 the  home.  512  Many  consumer  groups  contend  that  the  only  way  to  effectively  alleviate  these  harms  is  to  implement  a  zero  abandonment  rate  on  calls  delivered  by  predictive  dialers,  or  one  as 
 close  to  zero  as  possible.  513  Other  consumer  advocates  support  a  ban  on  predictive  dialers  altogether.  514 


 148.  Telemarketers  acknowledge  that  use  of  predictive  dialers  results  in  a  certain  percentage  of  dropped  calls.  515  But  they  contend  that  predictive  dialers  are  a  valuable  tool  for 
 increasing  productivity  and  lowering  costs  for  telemarketers  and,  ultimately,  for  consumers.  516  Some  industry  members  oppose  restrictions  on  the  use  of  predictive  dialers,  maintaining  that  the 
 industry  has  natural  incentives  to  keep  abandonment  rates  low  to  avoid  alienating  consumers.  517  Others  contend  that  a  set  rate  would  not  account  for  the  needs  of  various 
 telemarketing  campaigns.  518  While  many  telemarketers  maintain  that  a  maximum  abandonment  rate  would  eliminate  the  benefits  that  result  from  the  use  of  predictive  dialers,  519  most  would 
 nevertheless  support  a  call  abandonment  rate  of  5  percent.  520  A  few  commenters,  including  the  DMA,  would  not  oppose  a  3  percent  maximum  rate.  521  One  industry  commenter,  who  supported 
 a  set  abandonment  rate  on  predictive  dialers,  stated  that  if  non-  telemarketing  entities  continue  to  dial  without  restriction,  consumers  will  be  encouraged  to  join  do-  not-  call  lists.  522 


 511  See,  e.  g.,  NACAA  Comments  at  3;  Thomas  Pechnik  Comments  at  2;  Stewart  Abramson  Comments  at  1; 
 Katherine  S.  Raulston  Comments  at  1. 
 512  TOPUC  Comments  at  3. 


 513  See,  e.  g.,  NAAG  Comments  at  34-  35  (a  0%  abandonment  rate  is  the  appropriate  standard);  NASUCA 
 Comments  at  3;  TOPUC  Comments  at  3;  AARP  Comments  at  2;  Michael  C.  Worsham  Comments  at  6. 
 514  See,  e.  g.,  Mathemaesthetics  Comments  at  6;  NCL  Comments  at  4;  Private  Citizen  Comments  at  7. 


 515  ATA  Comments  at  109. 
 516  Pacesetter  Comments  at  5;  Teleperformance  Comments  at  2;  ATA  Comments  at  109;  MBNA  Comments  at  7; 
 NAA  Comments  at  15-  16;  Allstate  Comments  at  2. 
 517  ATA  Comments  at  109. 


 518  SER  Comments  at  2;  MPA  Comments  at  21. 
 519  SBC  Reply  Comments  at  4;  Sytel  Reply  Comments  at  4;  DMA  Reply  Comments  at  19. 
 520  Cendant  Comments  at  3;  CBA  Comments  at  8;  Bank  of  America  Comments  at  5;  ABA  Comments  at  3; 
 DialAmerica  Comments  at  10;  ITC  Further  Comments  at  4. 
 521  Sytel  Comments  at  7;  DMA  Comments  at  31;  Nextel  Further  Comments  at  11  (stating  that  any  Commission 
 regulation  of  call  abandonment  rates  should  be  no  more  restrictive  than  the  maximum  three  percent  rate  established  by  the  FTC). 


 522  Sytel  Reply  Comments  at  2,  4. 
89

 Federal  Communications  Commission  FCC  03-  153 
 90 
 149.  In  its  telemarketing  proceeding,  the  FTC  determined  that  a  total  ban  on  abandoned  calls  would  amount  to  a  ban  on  predictive  dialers,  and  would  not  strike  the  proper 
 balance  between  addressing  an  abusive  practice  and  allowing  for  a  technology  that  reduces  costs  for  telemarketers.  523  The  FTCs  amended  Rule  prohibits  abandoned  calls,  524  but  provides  in  a 
 safe  harbor  that  a  seller  or  telemarketer  will  not  be  deemed  to  have  violated  the  TSR  if  the  seller  or  telemarketer  can  show  that  its  conduct  conforms  to  certain  specified  standards, 
 including  a  call  abandonment  rate  of  no  more  than  three  (3)  percent,  measured  on  a  per  day  per  campaign  basis.  525 


 B.  Discussion 
 150.  Given  the  arguments  raised  on  both  sides  of  this  issue  as  well  as  the  FTCs  approach  to  the  problem,  the  Commission  has  determined  to  adopt  a  rule  to  reduce  the  number  of 


 abandoned  calls  consumers  receive.  526  Under  the  new  rules,  telemarketers  must  ensure  that  any  technology  used  to  dial  telephone  numbers  abandons  no  more  than  three  (3)  percent  of  calls 
 answered  by  a  person,  measured  over  a  30-  day  period.  A  call  will  be  considered  abandoned  if  it  is  not  transferred  to  a  live  sales  agent  within  two  (2)  seconds  of  the  recipients  completed 


 523  See  FTC  Order,  68  Fed.  Reg.  at  4642.  The  FTC  found  that  a  three  (3)  percent  abandonment  rate  was  feasible, 
 realistic  and  fully  capable  of  being  achieved.  Id.  at  4643.  See  also  FTC  Further  Comments  at  33-  38. 
 524  Section  310.4(  b)(  1)(  iv)  of  the  amended  TSR  defines  a  prohibited  abandoned  outbound  call  as  one  in  which  the 
 recipient  of  the  call  answers  the  call,  and  the  telemarketer  does  not  connect  the  call  to  a  sales  representative  within  two  seconds  of  the  persons  completed  greeting.  FTC  Order,  68  Fed.  Reg.  at  4642.  The  FTC  notes  that  this 


 definition  of  abandoned  call  covers  dead  air  and  hang-  up  calls,  in  which  the  telemarketer  hangs  up  on  a  called  consumer  without  connecting  that  consumer  to  a  sales  representative.  Id. 


 525  Under  FTC  Rule  310.4(  b)(  4),  a  seller  or  telemarketer  will  not  be  liable  for  violating  310.4(  b)(  1)(  iv)  if:  (i)  the 
 seller  or  telemarketer  employs  technology  that  ensures  abandonment  of  no  more  than  three  (3)  percent  of  all  calls  answered  by  a  person,  measured  per  day  per  calling  campaign;  (ii)  the  seller  or  telemarketer,  for  each 


 telemarketing  call  placed,  allows  the  telephone  to  ring  for  at  least  fifteen  (15)  seconds  or  four  (4)  rings  before  disconnecting  an  unanswered  call;  (iii)  whenever  a  sales  representative  is  not  available  to  speak  with  the  person 
 answering  the  call  within  two  (2)  seconds  after  the  persons  completed  greeting,  the  seller  or  telemarketer  promptly  plays  a  recorded  message  that  states  the  name  and  telephone  number  of  the  seller  on  whose  behalf  the 
 call  was  placed;  and  (iv)  the  seller  or  telemarketer,  in  accordance  with  310.5(  b)-(  d),  retains  records  establishing  compliance  with  310.4(  b)(  4)(  i)-(  iii).  FTC  Order,  68  Fed.  Reg.  at  4643-  45. 


 The  FTCs  rules  on  call  abandonment  were  to  go  into  effect  on  March  31,  2003.  In  response  to  petitions  filed  by  the  DMA  and  ATA,  the  FTC  determined  to  stay  the  date  by  which  it  would  require  compliance  with  the 
 abandoned  call  rules  until  October  1,  2003.  The  FTC  concluded  that  staying  these  provisions  will  provide  ample  time  for  all  telemarketers  who  use  predictive  dialers  to  obtain,  install,  and  test  the  necessary  hardware  or  software, 
 and  should  alleviate  concerns  that  predictive  dialer  manufacturers  might  not  have  adequate  supplies  of  the  necessary  products  by  the  March  31  deadline.  See  Letter  from  Donald  S.  Clark,  Secretary,  FTC,  to  Robert  Corn-Revere, 
 Ronald  G.  London  and  Paul  A.  Werner  III,  Counsel  for  the  ATA,  March  14,  2003  (available  at  <http://  www.  ftc.  gov/  os/  2003/  03/  030314ataletter.  htm>).  See  also  Telemarketing  Sales  Rule  (Federal  Trade 
 Commn,  Stay  of  Compliance  Date),  68  Fed.  Reg.  16414  (April.  4,  2003). 
 526  See  2002  Notice,  17  FCC  Rcd  at  17475-  76,  para.  26  (seeking  comment  on  what  approaches  we  might  take  to 
 minimize  any  harm  that  results  from  the  use  of  predictive  dialers  and  on  alternative  approaches  to  the  problems  associated  with  abandoned  calls). 
90

 Federal  Communications  Commission  FCC  03-  153 
 91 
 greeting.  When  a  call  is  abandoned  within  the  three  (3)  percent  maximum  allowed,  a  telemarketer  must  deliver  a  prerecorded  identification  message  containing  only  the 
 telemarketers  name,  telephone  number,  and  notification  that  the  call  is  for  telemarketing  purposes.  To  allow  time  for  a  consumer  to  answer  the  phone,  the  telemarketer  must  allow  the 
 phone  to  ring  for  fifteen  seconds  or  four  rings  before  disconnecting  any  unanswered  call.  Finally,  telemarketers  using  predictive  dialers  must  maintain  records  that  provide  clear  and 
 convincing  evidence  that  the  dialers  used  comply  with  the  three  (3)  percent  call  abandonment  rate,  ring  time  and  two-  second-  transfer  rule. 


 1.  Maximum  Rate  on  Abandoned  Calls 
 151.  The  Commission  believes  that  establishing  a  maximum  call  abandonment  rate  is  the  best  option  to  reduce  effectively  the  number  of  hang-  ups  and  dead  air  calls  consumers 


 experience.  We  recognize  that  industry  generally  advocates  a  five  percent  abandonment  rate,  claiming  that  a  rate  lower  than  five  percent  would  reduce  efficiencies  the  technology  provides.  527 
 However,  the  Commission  is  not  convinced  that  a  five  percent  rate  will  lead  to  a  reasonable  reduction  in  the  number  of  abandoned  calls.  The  DMAs  current  guideline,  cited  by  many 
 commenters,  calls  for  an  abandonment  rate  of  no  higher  than  five  percent.  528  And  several  telemarketers  maintain  that  they  now  utilize  an  abandonment  rate  of  five  percent  or  lower  in 
 their  calling  campaigns.  529  Consumers  nevertheless  report  receiving  as  many  as  20  dropped  calls  per  day  that  interrupt  dinners,  interfere  with  home  business  operations,  and  sometimes  frighten 
 the  elderly  and  parents  with  young  children.  530  A  rule  that  is  consistent  with  the  FTCs  will  effectively  create  a  national  standard  with  which  telemarketers  must  comply  and  should  lead  to 
 fewer  abandoned  calls,  while  permitting  telemarketers  to  continue  to  benefit  from  such  technology.  It  is  also  responsive  to  Congress  mandate  in  the  Do-  Not-  Call  Act  to  maximize 
 consistency  with  the  FTCs  rules. 
 152.  The  three  percent  abandonment  rate  will  be  measured  over  a  30-  day  period,  a  standard  supported  by  several  industry  commenters.  531  Industry  members  maintain  that 


 measuring  the  abandonment  rate  on  a  per  day  basis  would  severely  curtail  the  efficiencies  gained  from  the  use  of  predictive  dialers,  and  may  be  overly  burdensome  to  smaller  telemarketers.  A 
 per  day  measurement,  they  argue,  would  not  account  for  short-  term  fluctuations  in  marketing 
 527  However,  some  industry  commenters  indicate  that  a  3  percent  rate  still  obtains  productivity  benefits.  See,  e.  g, 
 WorldCom  Comments  at  44. 
 528  See  <http://  www.  the-  dma.  org/  guidelines/  dotherightthing.  pdf.> 


 529  See,  e.  g.,  Sprint  Comments  at  6  (uses  5%);  CMOR  Comments  at  6  (uses  a  1%  rate);  WorldCom  Comments  at 
 44  (uses  3-  5%);  see  also  ATA  Reply  Comments  at  70  (many  telemarketers  from  all  industries  use  a  5%  limit  on  abandoned  calls);  Technion  Comments  at  5  (uses  5%  abandonment  rate). 


 530  See,  e.  g.,  Edwin  Bailey  Hathaway  Comments;  Stewart  Abramson  Comments  at  1;  Kent  Rausch  Comments. 
 531  Reese  Comments  at  7;  ERA  Comments  at  16;  MPA  Comments  at  20;  DMA  Reply  Comments  at  19-  20; 
 DialAmerica  Reply  Comments  at  3-  4  (noting  that  California  allows  compliance  with  its  abandoned  call  rules  over  a  30-  day  period);  DialAmerica  Further  Reply  Comments  at  5  (stating  that  it  can  achieve  an  average  abandonment 


 rate  of  5%  or  less  when  the  measuring  period  spans  a  month). 
91

 Federal  Communications  Commission  FCC  03-  153 
 92 
 campaigns.  532  They  further  argue  that  the  impact  of  abandoned  calls  on  consumers  depends  more  on  the  aggregate  number  of  contacts  made  by  a  telemarketer  over  time  and  not  on  the  number  in 
 any  given  day.  533  The  Commission  believes  that  a  three  (3)  percent  abandonment  rate  measured  over  a  30-  day  period  will  ensure  that  consumers  consistently  receive  fewer  disconnected  calls, 
 and  that  telemarketers  are  permitted  to  manage  their  calling  campaigns  effectively  under  the  new  rules  on  abandoned  calls.  Although  we  recognize  that  this  rate  of  measurement  differs  from  the 
 FTCs  rule,  we  believe  a  rate  measured  over  a  longer  period  of  time  will  allow  for  variations  in  telemarketing  campaigns  such  as  calling  times,  number  of  operators  available,  number  of 
 telephone  lines  used  by  the  call  centers,  and  other  similar  factors.  534  The  record  also  suggests  that  an  abandonment  rate  measured  over  a  30-  day  period  will  allow  telemarketers  to  more  easily 
 comply  with  the  recordkeeping  requirements  associated  with  the  use  of  predictive  dialers.  535 
 2.  Two-  Second-  Transfer  Rule 
 153.  The  record  confirms  that  many  consumers  are  angered  by  the  dead  air  they  often  face  when  answering  the  telephone.  Running  to  the  telephone  only  to  be  met  by  silence 


 can  be  frustrating  and  even  frightening,  if  the  caller  cannot  be  identified.  536  To  address  the  problem  of  dead  air  produced  by  dialing  technologies,  the  Commission  has  determined  that  a 
 call  will  be  considered  abandoned  if  the  telemarketer  fails  to  connect  the  call  to  a  sales  representative  within  two  (2)  seconds  of  the  persons  completed  greeting.  537  Calls  disconnected 
 because  they  were  never  answered  (within  the  required  15  seconds  or  4  rings)  or  because  they  received  busy  signals  will  not  be  considered  abandoned.  538  This  requirement  is  consistent  with 
 the  FTCs  rule.  539 
 154.  Answering  Machine  Detection.  Opposition  from  industry  to  the  two-  second-transfer  requirement  appears  to  be  based  largely  on  its  implications  for  use  of  Answering 


 532  WorldCom  Reply  Comments  at  20;  WorldCom  Further  Comments  at  8  (advocating  that  the  abandonment  rate 
 be  measured  over  a  six-  month  period);  Teleperformance  Further  Comments  at  4;  see  also  MPA  Comments  at  21. 
 533  See,  e.  g.,  Reese  Comments  at  7;  WorldCom  Reply  Comments  at  20. 


 534  See  ERA  Comments  at  16;  Stonebridge  Further  Comments  at  6  (three  percent  abandonment  rate  imposes  an 
 unnecessary  burden  on  telemarketers,  which  should  be  alleviated  by  eliminating  any  reference  to  a  per-  day  measure);  Teleperformance  Further  Comments  at  3. 


 535  See  WorldCom  Reply  Comments  at  19-  20;  Reese  Comments  at  7. 
 536  See,  e.  g.,  Katherine  S.  Raulston  Comments;  Edwin  Bailey  Hathaway  Comments;  NAAG  Comments  at  34. 
 537  See  supra  discussion  on  the  use  of  prerecorded  messages,  paras.  136-  144. 
 538  Calls  that  reach  voicemail  or  an  answering  machine  will  not  be  considered  answered  by  the  called  party. 
 Therefore,  a  call  that  is  disconnected  upon  reaching  an  answering  machine  will  not  be  considered  an  abandoned  call. 


 539  See  16  C.  F.  R.    310.4(  b)(  1)(  iv). 
92

 Federal  Communications  Commission  FCC  03-  153 
 93 
 Machine  Detection  (AMD).  540  Some  industry  members  explain  that  AMD  is  used  by  telemarketers  to  detect  answering  machines,  and  thereby  avoid  leaving  messages  on  them.  541 
 The  ATA  and  DMA  maintain  that  if  telemarketers  are  required  to  connect  to  a  sales  agent  or  message  within  1-  2  seconds,  a  large  percentage  of  calls  reaching  answering  machines  will  be 
 transferred  to  sales  agents,  thereby  reducing  the  efficiencies  gained  from  AMD.  542  According  to  these  commenters,  1-  2  seconds  is  often  insufficient  for  AMD  to  determine  accurately  if  the  call 
 has  reached  an  answering  machine.  543  Other  commenters  explain  that  AMD  is  used  instead  by  telemarketers  to  transmit  prerecorded  messages  to  answering  machines;  in  such  circumstances, 
 calls  that  reach  live  persons  are  disconnected.  544  It  is  unclear  from  the  record  how  prevalent  the  use  of  AMD  is  in  the  telemarketing  industry.  One  commenter  stated  that  the  elimination  of 
 AMD  would  put  consumer-  oriented  telemarketing  firms  out  of  business.  545  However,  other  industry  members  acknowledge  that  AMD  contributes  significantly  to  the  amount  of  dead  air 
 consumers  experience,  546  and  one  large  telemarketing  firm  maintains  that  AMD  should  be  banned  completely.  547  The  Commission  believes  that  the  record  does  not  warrant  a  ban  on  the 
 use  of  AMD.  Instead,  if  the  AMD  technology  is  deployed  in  such  a  way  that  the  delay  in  transfer  time  to  a  sales  agent  is  limited  to  two  seconds,  then  its  continued  use  should  not 


 540  See,  e.  g.,  MBNA  Comments  at  7-  8;  ATA  at  112.  But  see  Reese  Comments  at  6  (  Abandons  should  not  be 
 defined  so  as  to  include  any  measure  of  time  to  transfer,    as  these  timings  are  not  available  in  currently  installed  dialers.). 


 541  Technion  Comments  at  5. 
 542  ATA  Comments  at  117  (suggesting  a  4-  second  transfer  requirement);  DMA  Reply  Comments  at  19  (  AMD 
 serves  perfectly  legitimate  business  purposes  causing  negligible  harm  to  consumers,  but  current  technology  simply  will  not  ensure  that  dead  air  lasts  less  than  five  seconds.). 


 543  But  see  Alek  Szlam  Comments  at  5  (stating  that  [  o]  ne  possible  solution  is  to  require  the  threshold  in  the  AMD 
 to  be  set  to  err  on  the  side  of  connecting  vs.  disconnecting.  If  the  dialer  cannot  determine  within  the  first  second  whether  it  is  a  live  call  or  answering  machine,  it  will  assume  that  it  is  a  live  call  and  connect  it  to  an  agent.  On  the 


 agent  side,  when  they  are  passed  a  call  that  turns  out  to  be  an  answering  machine,  they  should  have  the  ability  to  quickly  terminate  the  call  or  to  push  a  button  to  play  a  message.  This  approach  will  reduce  the  amount  of  dead  air, 
 while  not  significantly  impacting  the  productivity  of  the  call  center  agent.).  See  also  Sytel  Comments  at  5  (  We  believe  that  the  loss  of  productivity  (measured  in  terms  of  talk  time  per  agent  hour)  that  results  when  answering 
 machines  are  connected  to  agents  in  call  centers  is  not  significant  when  set  against  the  improvement  in  call  quality  that  results  from  having  live  calls  connected  to  agents  immediately  i.  e.  not  exposing  consumers  to  dead  air  whilst 
 detection  is  done  by  the  switch.). 
 544  See  DialAmerica  Comments  at  10;  ABA  Comments  at  4;  Hershovitz  Comments  at  9.  We  reiterate  that  under 
 the  TCPA,  it  is  unlawful  to  initiate  any  telephone  call  to  any  residential  line  using  a  prerecorded  message  without  the  prior  express  of  the  called  party,  absent  an  emergency  or  an  exemption  by  Commission  rule  or  order.  Delivery 


 of  a  message  to  an  answering  machine  does  not  render  the  call  lawful.  See  47  U.  S.  C.    227(  b)(  1)(  B). 
 545  Reese  Comments  at  9;  see  also  Convergys  Comments  at  7  (  Elimination  of  the  use  of  AMD  would  cause 
 Convergys  to  re-  revaluate  its  participation  in  the  industry.) 
 546  Sytel  Comments  at  3-  4;  Alek  Szlam  Comments  at  4. 


 547  DialAmerica  Comments  at  10. 
93

 Federal  Communications  Commission  FCC  03-  153 
 94 
 adversely  affect  consumers  privacy  interests.  548 
 3.  Prerecorded  Message  for  Identification 
 155.  As  noted  above,  the  FTCs  safe  harbor  provisions  require  that,  when  a  sales  agent  is  unavailable  to  speak  to  a  person  answering  the  phone,  marketers  deliver  a  prerecorded 


 message  that  states  the  name  and  telephone  number  of  the  seller  on  whose  behalf  the  call  was  made.  549  The  Commission  has  similarly  determined  that  when  a  telemarketer  abandons  a  call 
 under  the  three  (3)  percent  rate  allowed,  the  telemarketer  must  deliver  a  prerecorded  message  containing  the  name  of  the  business,  individual  or  other  entity  initiating  the  call,  as  well  as  the 
 telephone  number  of  such  business,  individual  or  other  entity.  The  message  must  also  state  that  the  call  is  for  telemarketing  purposes.  550  We  recognize  that  many  consumers  are  frustrated 
 with  prerecorded  messages.  551  However,  the  record  also  reveals  that  consumers  are  frightened  and  angered  by  dead  air  calls  and  repeated  hang-  ups.  A  prerecorded  message,  limited  to 
 identification  information  only,  should  mitigate  the  harms  that  result  from  dead  air,  as  consumers  will  know  who  is  calling  them.  552  And,  they  will  more  easily  be  able  to  make  a  do-not- 
 call  request  of  a  company  by  calling  the  number  provided  in  the  message.  We  note  that  such  messages  sent  in  excess  of  the  three  (3)  percent  allowed  under  the  call  abandonment  rate,  will  be 
 considered  abandoned  calls,  unless  otherwise  permitted  by  our  rules.  The  content  of  the  message  must  be  limited  to  name  and  telephone  number,  along  with  a  notice  to  the  called  party  that  the 
 call  is  for  telemarketing  purposes.  The  message  may  not  be  used  to  deliver  an  unsolicited  advertisement.  553  We  caution  that  additional  information  in  the  prerecorded  message  constituting 
 an  unsolicited  advertisement  would  be  a  violation  of  our  rules,  if  not  otherwise  permitted  under  47  C.  F.  R.    64.1200(  a)(  2).  554 


 548  See  Sytel  Comments  at  3-  5.  The  Commission  notes  that  in  addition  to  requiring  the  delivery  of  a  prerecorded 
 identification  message  when  a  call  is  abandoned,  Commission  rules  also  permit  prerecorded  messages  in  limited  circumstances,  including  when  a  company  has  an  established  business  relationship  with  a  consumer.  See  47 


 U.  S.  C.    227(  b)(  1)(  B)  and  47  C.  F.  R.    64.1200(  a)(  2). 
 549  See  FTCs  amended  TSR  at  16  C.  F.  R.    310.4(  b)(  4)(  iii);  see  also  FTC  Order,  68  Fed.  Reg.  at  4644. 


 550  By  requiring  such  notice,  we  believe  consumers  will  be  less  likely  to  return  the  call  simply  to  learn  the  purpose 
 of  the  call  and  possibly  incur  unnecessary  charges. 
 551  See  supra  para.  137.  See  also  Wayne  G.  Strang  Further  Comments  at  5-  6. 


 552  See,  e.  g.,  NASUCA  Further  Reply  Comments  at  8-  9  (because  the  FTCs  identification  requirements  mitigate 
 the  nuisance  aspects  of  abandoned  calls,  the  FCC  should  make  an  exception  for  prerecorded  messages  that  are  used  to  comply  with  the  FTCs  safe  harbor  provision). 


 553  As  long  as  the  message  is  limited  to  identification  information  only,  it  will  not  be  considered  an  unsolicited 
 advertisement  under  our  rules.  See  FTC  Further  Comments  at  32.  But  see  Joe  Shields  Further  Comments  at  4-  5  (arguing  that  all  prerecorded  messages  that  introduce  a  business  are  by  definition  an  advertisement). 


 554  See  supra  discussion  on  prerecorded  messages,  paras.  136-  144.  Contrary  to  the  claims  of  some  parties,  even 
 an  incidental  reference  to  a  product  or  service  could  transform  the  identification  message  into  a  prohibited  unsolicited  advertisement.  See  Nextel  Further  Comments  at  14-  15. 
94

 Federal  Communications  Commission  FCC  03-  153 
 95 
 4.  Established  Business  Relationship 
 156.  While  the  TCPA  prohibits  telephone  calls  to  residential  phone  lines  using  an  artificial  or  prerecorded  voice  to  deliver  a  message  without  the  prior  express  consent  of  the 


 called  party,  the  Commission  determined  that  the  TCPA  permits  an  exemption  for  established  business  relationship  calls  from  the  restriction  on  artificial  or  prerecorded  message  calls  to 
 residences.  555  As  discussed  in  detail  above,  the  record  reveals  that  an  established  business  relationship  exemption  is  necessary  to  allow  companies  to  contact  their  existing  customers.  556 
 Companies  currently  use  prerecorded  messages,  for  example,  to  notify  their  customers  about  new  calling  plans,  new  mortgage  rates,  and  seasonal  services  such  as  chimney  sweeping  and 
 lawn  care.  557  Therefore,  prerecorded  messages  sent  by  companies  to  customers  with  whom  they  have  an  established  business  relationship  will  not  be  considered  abandoned  under  the  revised 
 rules,  if  they  are  delivered  within  two  (2)  seconds  of  the  persons  completed  greeting.  Similarly,  any  messages  initiated  with  the  called  partys  prior  express  consent  and  delivered  within  two  (2) 
 seconds  of  the  called  persons  completed  greeting  are  not  abandoned  calls  under  the  new  rules.  558  Such  messages  must  identify  the  business,  individual  or  entity  making  the  call  and 
 contain  a  telephone  number  that  a  consumer  may  call  to  request  placement  on  a  do-  not-  call  list.  We  recognize  that  the  established  business  relationship  exception  to  the  prohibition  on 
 prerecorded  messages  conflicts  with  the  FTCs  amended  rule.  559  However,  for  the  reasons  described  above,  we  believe  the  current  exception  is  necessary  to  avoid  interfering  with  ongoing 
 business  relationships. 
 5.  Ring  Duration 
 157.  The  Commission  also  adopts  a  requirement  that  telemarketers  allow  the  phone  to  ring  for  15  seconds  or  four  (4)  rings  before  disconnecting  any  unanswered  call.  This  standard  is 


 consistent  with  that  of  the  FTC,  similar  to  current  DMA  guidelines,  560  and  used  by  some  telemarketers  already.  561  One  industry  commenter  asserted  that  telemarketers  often  set  the 
 predictive  dialers  to  ring  for  a  very  short  period  of  time  before  disconnecting  the  call;  in  such  cases,  the  predictive  dialer  does  not  record  the  call  as  having  been  abandoned.  562  The  practice  of 


 555  See  1992  TCPA  Order,  7  FCC  Rcd  at  8770-  71,  para.  34. 
 556  But  see  FTC  Further  Comments  at  40-  41  (  The  FCC  may  need  to  eliminate  the  established  business 
 relationship  exemption  with  respect  to  prerecorded  message  calls,  especially  if,  as  the  FTC  urges,  it  includes  in  its  revised  TCPA  regulations  provisions  addressing  the  practice  of  call  abandonment  and  creating  a  safe  harbor.) 


 557  See,  e.  g.,  NAAG  Comments  at  39;  Joe  Shields  Reply  Comments  at  6-  7. 
 558  See  amended  47  C.  F.  R.    64.1200(  a)(  6)(  i). 
 559  See  FTC  Further  Comments  at  40-  41  (under  the  FTCs  amended  rules,  such  prerecorded  messages  would  be 
 prohibited  as  abandoned  calls). 
 560  DMA  Comments,  Exhibit  1  (Guidelines  for  Ethical  Business  Practice)  at  23. 


 561  WorldCom  Reply  Comments  at  20-  21. 
 562  Sytel  Comments  at  3. 
95

 Federal  Communications  Commission  FCC  03-  153 
 96 
 ringing  and  then  disconnecting  the  call  before  the  consumer  has  an  opportunity  to  answer  the  phone  is  intrusive  of  consumer  privacy  and  serves  only  to  increase  efficiencies  for  telemarketers. 
 Moreover,  in  discussing  the  interplay  between  the  FTCs  rules  with  the  Commissions  rules,  very  few  commenters  opposed  the  ring  time  requirement  adopted  by  the  FTC,  563  or  raised  any 
 particular  concerns  about  how  it  might  work  in  the  TCPA  framework.  Therefore,  given  the  substantial  interest  in  protecting  consumers  privacy  interests,  as  well  as  Congresss  direction  to 
 maximize  consistency  with  the  FTCs  rules,  we  have  determined  to  adopt  the  15  second  or  four  (4)  ring  requirement. 


 158.  Finally,  consistent  with  the  FTCs  rules,  the  Commission  has  determined  that  telemarketers  must  maintain  records  establishing  that  the  technology  used  to  dial  numbers 
 complies  with  the  three  (3)  percent  call  abandonment  rate,  ring  time,  and  two-  second  rule  on  connecting  to  a  live  sales  agent.  Telemarketers  must  provide  such  records  in  order  to 
 demonstrate  compliance  with  the  call  abandonment  rules.  Only  by  adopting  a  recordkeeping  requirement  will  the  Commission  be  able  to  adequately  enforce  the  rules  on  the  use  of  predictive 
 dialers. 
 159.  The  TCPA  seeks  primarily  to  protect  subscribers  from  unrestricted  commercial  telemarketing  calls,  and  therefore  exempts  calls  or  messages  by  tax-  exempt  nonprofit 


 organizations  from  the  definition  of  telephone  solicitation.  564  Therefore,  the  Commission  has  determined  not  to  extend  the  call  abandonment  rules  to  tax-  exempt  nonprofit  organizations  in  the 
 absence  of  further  guidance  from  Congress.  565  However,  the  call  abandonment  rules  will  apply  to  all  other  companies  engaged  in  telemarketing,  and  the  existence  of  an  established  business 
 relationship  between  the  telemarketer  and  consumer  will  not  be  an  exception  to  these  rules.  For  these  entities,  the  call  abandonment  rules  will  become  effective  on  October  1,  2003.  We  decline 
 to  establish  an  effective  date  beyond  October  1,  2003,  which  is  consistent  with  the  date  that  telemarketers  must  comply  with  the  FTCs  call  abandonment  rules.  566  This  should  permit 
 telemarketers  to  make  any  modifications  to  their  autodialing  equipment  or  purchase  any  new  software  to  enable  them  to  comply  with  the  three  (3)  percent  call  abandonment  rate,  the 
 prerecorded  message  requirement  and  the  two-  second-  transfer  rule. 
 XI.  WIRELESS  TELEPHONE  NUMBERS 
 A.  Background 
 160.  In  the  2002  Notice,  the  Commission  noted  that  the  TCPA  permits  the  Commission 
 563  WorldCom  indicated  that  such  recommendation  should  not  be  implemented,  yet  stated  that  its  dialers  are 
 programmed  to  disconnect  the  call  if  there  is  no  answer  after  4  ring  cycles,  which  provides  sufficient  time  for  a  consumer  to  reach  the  phone.  See  WorldCom  Reply  Comments  at  20-  21. 


 564  See  1992  TCPA  Order,  7  FCC  Rcd  at  8773-  74,  para.  40. 
 565  Because  this  will  result  in  an  inconsistency  with  the  FTCs  rules,  we  will  discuss  the  call  abandonment  rules  in 
 the  report  due  to  Congress  within  45  days  after  the  promulgation  of  final  rules.  See  Do-  Not-  Call  Act,  Section  4. 
 566  See  Notices  of  Ex  Parte  Presentations  from  WorldCom  to  FCC,  filed  May  23,  2003  and  June  16,  2003 
 (advocating  a  9.5-  month  implementation  period  for  the  call  abandonment  rules). 
96

 Federal  Communications  Commission  FCC  03-  153 
 97 
 to  exempt  from  the  restrictions  on  autodialer  or  prerecorded  message  calls,  calls  to  a  telephone  number  assigned  to  a  cellular  telephone  service  that  are  not  charged  to  the  called  party,  subject  to 
 such  conditions  as  the  Commission  may  prescribe  as  necessary  in  the  interest  of  the  privacy  rights  [the  TCPA]  is  intended  to  protect.  567  In  the  1992  TCPA  Order,  the  Commission 
 concluded  that  calls  made  by  cellular  carriers  to  their  subscribers  for  which  the  subscribers  were  not  charged  do  not  fall  within  the  prohibitions  on  autodialers  or  prerecorded  messages.  568  We 
 sought  comment  on  the  extent  to  which  telemarketing  to  wireless  consumers  exists  today  and  if  so,  the  nature  and  frequency  of  such  solicitations.  569  We  asked  whether  there  are  other  types  of 
 calls  to  wireless  telephone  numbers  that  are  not  charged  to  the  called  party,  and  whether  such  calls  also  should  not  fall  within  the  prohibitions  on  autodialers  or  prerecorded  messages.  570  We 
 also  sought  comment  on  any  developments  anticipated  in  the  near  future  that  may  affect  telemarketing  to  wireless  phone  numbers.  Specifically,  we  asked  how  telemarketers  will  identify 
 wireless  numbers  in  order  to  comply  with  the  TCPA  when  consumers  are  able  to  port  numbers  from  their  wireline  phones  to  wireless  phones,  571  or  receive  numbers  from  a  thousands-  block  572 
 that  was  part  of  a  central  office  code  previously  assigned  to  a  wireline  carrier.  573  The  Commission  further  sought  comment  on  whether  the  Commissions  rules  should  be  modified  to 
 facilitate  telemarketers  efforts  to  comply  with  the  TCPA. 
 161.  Local  Number  Portability  and  Pooling.  The  Commissions  local  number  portability  (LNP)  decisions  date  back  to  1996,  with  the  Commission  granting  a  number  of 


 extensions  to  the  effective  date  for  wireless  carriers,  providing  the  industry  and  other  interested  parties  with  extensive  advance  notice  of  the  impending  implementation  of  wireless  LNP.  The 
 Commission  determined  in  the  Number  Portability  First  Report  and  Order  that  LECs  and  certain  CMRS  providers  operating  in  the  100  largest  MSAs  must  offer  local  number  portability, 
 according  to  a  phased  deployment  schedule.  574  This  requirement  was  subsequently  limited  by  the  Number  Portability  First  Order  on  Reconsideration,  in  which  the  Commission  concluded 


 567  2002  Notice,  17  FCC  Rcd  at  17485,  para.  45  (footnote  omitted);  see  also  47  U.  S.  C.    227(  b)(  2)(  C). 
 568  1992  TCPA  Order,  7  FCC  Rcd  at  8775,  para.  45. 
 569  2002  Notice,  17  FCC  Rcd  at  17485,  para.  43. 
 570  2002  Notice,  17  FCC  Rcd  at  17485,  para.  45 
 571  Wireless  carriers  will  begin  providing  local  number  portability  (LNP)  on  November  24,  2003.  LNP  means 
 the  ability  of  users  of  telecommunications  services  to  retain,  at  the  same  location,  existing  telecommunications  numbers  without  impairment  of  quality,  reliability,  or  convenience  when  switching  from  one  telecommunications 


 carrier  to  another.  47  U.  S.  C.    153(  30).  See  also  47  C.  F.  R.    52.21(  k). 
 572  Wireless  carriers  began  participating  in  thousands-  block  number  pooling  (pooling)  on  November  24,  2002. 
 Thousands-  block  number  pooling  is  a  process  by  which  the  10,000  numbers  in  a  central  office  code  (NXX)  are  separated  into  to  sequential  blocks  of  1,000  numbers  each  (thousands-  blocks),  and  allocated  separately  within  a 


 rate  center.  See  47  C.  F.  R.    52.20(  a). 
 573  2002  Notice,  17  FCC  Rcd  at  17485-  86,  para.  46. 


 574  Telephone  Number  Portability,  CC  Docket  No.  95-  116,  First  Report  and  Order  and  Further  Notice  of  Proposed 
 Rulemaking,  11  FCC  Rcd  8352,  8393,  para.  77  (1996)  (Number  Portability  First  Report  and  Order). 
97

 Federal  Communications  Commission  FCC  03-  153 
 98 
 that  LECs  and  covered  CMRS  providers  were  required  only  to  deploy  LNP  within  switches  for  which  another  carrier  has  made  a  specific  request  for  the  provision  of  LNP.  575  CMRS  carriers 
 are  required  to  implement  LNP  on  November  24,  2003,  for  switches  in  the  top  100  MSAs  requested  by  February  24,  2003.  576  After  November  24,  2003,  CMRS  carriers  have  30  to  180 
 days  from  the  request  date  to  implement  number  portability  for  switches  in  the  top  100  MSAs  not  previously  requested  and  for  switches  outside  the  top  100  MSAs.  577 


 162.  In  the  Numbering  Resource  Optimization  First  Report  and  Order,  the  Commission  established  national  thousands-  block  number  pooling  (pooling)  as  an  LNP-  based 
 numbering  resource  optimization  measure  designed  to  help  slow  the  pace  of  area  code  and  North  American  Numbering  Plan  (NANP)  exhaust.  578  This  measure  involves  breaking  up  the  10,000 
 numbers  in  an  NXX  into  ten  sequential  blocks  of  1,000  numbers  each,  and  allocating  each  thousands-  block  to  a  different  service  provider,  and  possibly  a  different  switch,  within  the  same 
 rate  center.  The  Commission  mandated  participation  in  national  pooling  by  all  carriers  that  are  required  to  be  LNP-  capable,  because  it  believed  that  LNP  capability  was  required  before  a 
 carrier  could  participate  in  thousands-  block  number  pooling.  579  In  the  Numbering  Resource  Optimization  Fourth  Report  and  Order,  the  Commission  determined  that  thousands-  block 
 number  pooling  need  not  be  linked  to  a  carriers  ability  to  provide  LNP  because  a  carrier  can  participate  in  pooling  once  it  deploys  the  location  routing  number  architecture.  580  The 
 Commission,  therefore,  concluded  that  all  carriers,  except  those  specifically  exempted,  are  required  to  participate  in  thousands-  block  number  pooling  in  accordance  with  the  national 
 rollout  schedule,  581  regardless  of  whether  they  are  required  to  provide  LNP,  including  covered 


 575  Telephone  Number  Portability,  CC  Docket  No.  95-  116,  First  Memorandum  Opinion  and  Order  on 
 Reconsideration,  12  FCC  Rcd  7236,  7272-  3,  paras.  59-  60  (1997)  (Number  Portability  First  Order  on  Reconsideration). 


 576  Verizon  Wirelesss  Petition  for  Partial  Forbearance  from  the  Commercial  Mobile  Radio  Services  Number 
 Portability  Obligation,  WT  Docket  No.  01-  184,  and  Telephone  Number  Portability,  CC  Docket  No.  95-  116,  Memorandum  Opinion  and  Order,  17  FCC  Rcd  14972,  14981,  para.  23  affirmed  CTIA  v.  FCC,  No.  02-  1264,  2003 


 WL  21293569  (D.  C.  Cir.  June  6,  2003). 
 577  Id.  at  14985-  86. 


 578  Numbering  Resource  Optimization,  CC  Docket  No.  99-  200,  First  Report  and  Order  and  Further  Notice  of 
 Proposed  Rulemaking,  15  FCC  Rcd  7574  (2000)  (Numbering  Resource  Optimization  First  Report  and  Order). 
 579  Numbering  Resource  Optimization,  CC  Docket  No.  99-  200,  Third  Order  on  Reconsideration  in  CC  Docket  No. 
 99-  200,  Third  Further  Notice  of  Proposed  Rulemaking  in  CC  Docket  No.  99-  200,  and  Second  Further  Notice  of  Proposed  Rulemaking  in  CC  Docket  No.  95-  116.  17  FCC  Rcd  4784  at  4787,  para.  9  (2002). 


 580  Numbering  Resource  Optimization  Implementation  of  the  Local  Competition  Provisions  of  the 
 Telecommunications  Act  of  1996,  Telephone  Number  Portability,  CC  Docket  Nos.  99-  200,  96-  98,  and  95-  116,  Fourth  Report  and  Order  and  Fourth  Further  Notice  of  Proposed  Rulemaking,  FCC  03-  126  (rel.  June  18,  2003), 


 para.  11  (Numbering  Resource  Optimization  Fourth  Report  and  Order). 
 581  Numbering  Resource  Optimization  Fourth  Report  and  Order.  See  also  Numbering  Resource  Optimization,  CC 
 Docket  No.  99-  200,  Order,  17  FCC  Rcd  7347  (2002)  (Pooling  Rollout  Schedule). 
98

 Federal  Communications  Commission  FCC  03-  153 
 99 
 CMRS  providers.  582 
 163.  Telemarketing  to  Wireless  Numbers.  The  record  suggests  that  while  consumers  receive  telemarketing  calls  on  their  wireless  phones,  it  is  not  a  widespread  practice  at  this  time.  583 


 However,  some  industry  members  believe  that  telemarketing  calls  to  wireless  numbers  are  likely  to  increase,  584  particularly  as  growing  numbers  of  consumers  use  wireless  phones  as  their 
 primary  phones.  585  One  commenter  pointed  out  that  the  record  in  this  proceeding  demonstrates  that  telemarketers  would  like  to  solicit  consumers  on  their  wireless  phones.  586  Although  the 
 record  does  not  reflect  the  full  panoply  of  methods  telemarketers  currently  use  to  avoid  calling  wireless  telephone  numbers,  the  record  provides  a  sampling  of  such  methods.  587  For  example, 
 the  Direct  Marketing  Associations  (DMA)  Telephone  Preference  Service  allows  consumers  to  opt-  out  of  national  telemarketing  lists,  allowing  consumers  to  register  their  wireless  phone 
 numbers  in  order  to  ensure  that  they  do  not  receive  telemarketing  calls  on  their  wireless  phones.  588  Additionally,  the  DMA  has  created  the  Wireless  Telephone  Suppression  Service.  589 
 A  number  of  commenters  contended  that  telemarketing  to  wireless  phones  is  not  a  significant  problem,  indicating  that  the  industries  voluntary  efforts  have  been  successful.  590  Commenters 
 also  state  that  the  wireless  and  telemarketing  industries  have  been  actively  working  together  to  ensure  that  telemarketing  does  not  become  a  problem  for  wireless  customers.  591 


 582  See  Verizon  Wireless  Petition  for  Partial  Forbearance  from  the  Commercial  Mobile  Radio  Services  Number 
 Portability  Obligation,  WT  Docket  No.  01-  184,  and  Telephone  Number  Portability,  CC  Docket  No.  95-  116,  Memorandum  Opinion  and  Order,  17  FCC  Rcd  14972,  affirmed  CTIA  v.  FCC,  No.  02-  1264,  2003  WL  21293569 


 (D.  C.  Cir.  June  6,  2003). 
 583  But  see  April  Jordan  Comments  at  1;  Mark  A.  Hiner  Comments  at  2;  Rhett  Riviere  Comments  (all  three  of 
 whom  received  marketing  calls  on  their  cell  phones);  AT&  T  Wireless  Comments  at  29  (  little  telemarketing  is  directed  to  wireless  subscribers  .  .  .  [although]  such  activity  likely  will  increase.). 


 584  See,  e.  g.,  CTIA  Comments  at  5  (  having  built  it,  [they]  will  come);  AT&  T  Wireless  Comments  at  29 
 (reported  receiving  some  complaints  from  customers  regarding  calls  to  wireless  phones). 
 585  ARDA  Comments  at  12;  BellSouth  Comments  at  6-  7.  But  see  Nextel  Comments  at  21-  22  (whose  report 
 indicates  that  only  3  percent  of  wireless  service  subscribers  have  used  their  mobile  phones  to  displace  traditional  residential  landline  service). 


 586  AT&  T  Wireless  Reply  Comments  at  21. 
 587  Cingular  Wireless  Comments  at  5;  DMA  Comments  at  35;  NeuStar  Comments  at  2. 
 588  See  <http://  www.  dmaconsumers.  org/  cgi/  offtelephonedave>  (accessed  June  2,  2003). 
 589  Cingular  Wireless  Comments  at  5.  This  service  provides  a  list  of  280  million  phone  numbers  that  are  currently 
 used  or  have  been  set  aside  for  CMRS  carriers.  Id. 
 590  American  Bankers  Association  Comments  at  5;  AT&  T  Wireless  Comments  at  29;  American  Teleservices 
 Association  Reply  at  78;  Cingular  Wireless  Comments  at  4;  AT&  T  Wireless  Reply  at  21.  One  commenter,  however,  state  that  calls  to  wireless  phones  are  an  existing  and  growing  problem.  CTIA  Comments  at  5.  See  also 


 AT&  T  Wireless  Reply  at  21  (  it  is  likely  that  telemarketing  to  wireless  phones  will  increase). 
 591  Cingular  Wireless  Comments  at  4-  5. 
99

 Federal  Communications  Commission  FCC  03-  153 
 100 
 164.  Most  consumer  groups  maintain  that  all  telemarketing  calls  to  wireless  numbers  should  be  prohibited,  regardless  of  whether  they  are  made  using  an  autodialer,  prerecorded 
 message,  or  live  sales  agent.  592  The  vast  majority  of  consumer  advocates  contend  that  telemarketing  calls  to  cell  phones  are  as  intrusive  of  consumers  privacy  interests  as  calls  to 
 landline  phones.  593  Some  believe  they  are  more  so,  as  consumers  carry  their  cell  phones  on  their  persons,  to  work,  and  while  driving.  594  Some  also  contend  the  prohibition  should  apply  whether 
 the  consumer  incurs  a  per-  minute  charge  or  a  reduction  from  a  bucket  of  minutes  purchased  at  a  fixed  rate.  595  A  few  industry  commenters  agree  that  wireless  subscribers  should  be  protected 
 from  telemarketing  calls  to  their  wireless  numbers.  596  Other  industry  members  contend  that  wireless  phones  should  be  treated  like  wireline  phones,  in  part  because  of  the  difficulty  in 
 distinguishing  between  wireline  and  wireless  numbers.  597  American  General  Finance  argues  that  the  incremental  cost  of  receiving  a  cell  phone  call  is  not  significantly  different  from  the  cost  of 
 receiving  a  non-  cellular  call.  598  Some  commenters  suggest  permitting  calls  to  wireless  numbers  when  there  is  an  established  business  relationship,  599  when  the  calls  are  made  for  survey  research 
 purposes,  600  or  when  consumers  have  provided  their  cell  phone  numbers  to  the  calling  entity.  601  The  ATA  urges  the  Commission  to  find  that  calls  to  cellular  telephones  are  not  charged  to  the 
 called  party  as  contemplated  by  the  TCPAs  restriction  on  autodialed  calls.  602 


 592  See,  e.  g.,  NASUCA  Comments  at  19  (suggesting  that  telemarketing  calls  to  wireless  phones  be  prohibited 
 unless  expressly  authorized  by  the  subscriber);  NCL  Comments  at  6-  7;  TOPUC  Comments  at  7;  NAAG  Comments  at  35-  36. 


 593  See,  e.  g.,  J.  Melville  Capps  Comments;  City  of  New  Orleans  Comments  at  12. 
 594  See  J.  Melville  Capps  Comments;  J.  Shaw  Comments  at  5;  NCL  Comments  at  6-  7;  City  of  Chicago  Comments 
 at  13;  NAAG  Comments  at  35-  36;  EPIC  Comments  at  13  (  arguing  that  many  consider  their  wireless  phone  more  personal  than  their  wireline  phone). 


 595  See  NAAG  Comments  at  35;  CTIA  Comments  at  4-  5  (arguing  that  the  depletion  of  ones  minutes  by  unwanted 
 telemarketing  calls  is  a  cost.  Telemarketers  have  no  way  of  knowing  what  rate  plan  a  consumer  has.). 
 596  See  Sprint  Comments  at  10;  Verizon  Wireless  Reply  Comments  at  7  (noting  that  statutory  prohibition  on 
 autodialing  and  artificial  messages  to  wireless  service  is  absolute). 
 597  ATA  Comments  at  126-  128;  ATA  Reply  Comments  at  77-  80;  CBA  Comments  at  9  (arguing  that  premature 
 amendments  to  the  rules  could  stifle  the  evolution  of  mobile  commerce). 
 598  AGF  Comments  at  2. 


 599  See,  e.  g.,  AGF  Comments  at  1. 
 600  CMOR  Comments  at  7  (if  calls  to  cell  phones  are  not  permitted,  the  quality  of  survey  research  will  be  harmed). 
 But  see  John  Shaw  Reply  Comments  at  13  (if  survey  calls  are  exempted  from  the  TCPA,  many  sham  surveys  could  result  as  telemarketers  try  to  circumvent  the  regulations). 


 601  HFS  Comments  at  10;  BellSouth  Comments  at  6-  7;  Bank  of  America  Comments  at  6;  AGF  Comments  at  1. 
 602  ATA  Comments  at  130-  134.  See  also  HFS  Comments  at  10  (urging  the  Commission  to  permit  even  those  calls 
 to  wireless  numbers  made  by  autodialers  and  prerecorded  messages). 
100

 Federal  Communications  Commission  FCC  03-  153 
 101 
 B.  Discussion 
 1.  Telemarketing  Calls  to  Wireless  Numbers 
 165.  We  affirm  that  under  the  TCPA,  it  is  unlawful  to  make  any  call  using  an  automatic  telephone  dialing  system  or  an  artificial  or  prerecorded  message  to  any  wireless 


 telephone  number.  603  Both  the  statute  and  our  rules  604  prohibit  these  calls,  with  limited  exceptions,  to  any  telephone  number  assigned  to  a  paging  service,  cellular  telephone  service, 
 specialized  mobile  radio  service,  or  other  common  carrier  service,  or  any  service  for  which  the  called  party  is  charged.  605  This  encompasses  both  voice  calls  and  text  calls  to  wireless  numbers 
 including,  for  example,  short  message  service  (SMS)  calls,  provided  the  call  is  made  to  a  telephone  number  assigned  to  such  service.  606  Congress  found  that  automated  or  prerecorded 
 telephone  calls  were  a  greater  nuisance  and  invasion  of  privacy  than  live  solicitation  calls.  607  Moreover,  such  calls  can  be  costly  and  inconvenient.  608  The  Commission  has  long  recognized, 
 and  the  record  in  this  proceeding  supports  the  same  conclusion,  that  wireless  customers  are  charged  for  incoming  calls  whether  they  pay  in  advance  or  after  the  minutes  are  used.  609 
 Wireless  subscribers  who  purchase  a  large  bucket  of  minutes  at  a  fixed  rate  nevertheless  are  charged  for  those  minutes,  and  for  any  minutes  that  exceed  the  bucket  allowance.  This 
 bucket  could  be  exceeded  more  quickly  if  consumers  receive  numerous  unwanted  telemarketing  calls.  610  Moreover,  as  several  commenters  point  out,  telemarketers  have  no  way  to 
 determine  how  consumers  are  charged  for  their  wireless  service. 


 603  See  47  U.  S.  C.    227(  b)(  1),  which  provides  that  it  is  unlawful  for  any  person  within  the  United  States  to  make 
 any  call  (other  than  a  call  made  for  emergency  purposes  or  made  with  the  prior  express  consent  of  the  called  party)  using  any  automatic  telephone  dialing  system  or  an  artificial  or  prerecorded  voice  .  .  .  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. 


 604  47  C.  F.  R.    64.1200(  a)(  1)(  iii). 
 605  47  U.  S.  C.    227(  b)(  1)(  A)(  iii). 
 606  SMS,  for  example,  provides  the  ability  for  users  to  send  and  receive  text  messages  to  and  from  mobile 
 handsets  with  maximum  message  length  ranging  from  120  to  500  characters.  Section  6002(  B)  of  the  Omnibus  Budget  Reconciliation  Act  of  1993,  17  FCC  Rcd  12985,  13051  (2002). 


 607  TCPA,  Section  2(  10),  reprinted  in  7  FCC  Rcd  at  2744.  The  TCPA  prohibits  the  initiation  of  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  for  emergency  purposes  or  is  exempted  by  Commission  rule 


 or  order.  See  47  U.  S.  C.    227(  b)(  1)(  B). 
 608  See,  e.  g.,  Verizon  Wireless  Comments  at  11;  J.  Shaw  Comments  at  5;  NAAG  Comments  at  40-  41. 


 609  See,  e.  g.,  AT&  T  Wireless  Comments  at  24. 
 610  Consistent  with  our  determination  in  1992,  calls  made  by  cellular  carriers  to  their  subscribers,  for  which 
 subscribers  are  not  charged  in  any  way  for  the  call  (either  on  a  per  minute,  per  call,  or  as  a  reduction  in  their  bucket  of  minutes)  are  not  prohibited  under  the  TCPA.  See  Verizon  Wireless  Comments  at  11  (noting  that  for 


 bucket  plans,  exceeding  the  bucket  allowance  is  not  unusual). 
101

 Federal  Communications  Commission  FCC  03-  153 
 102 
 166.  Although  the  same  economic  and  safety  concerns  apply  to  all  telephone  solicitation  calls  received  by  wireless  subscribers,  the  Commission  has  determined  not  to 
 prohibit  all  live  telephone  solicitations  to  wireless  numbers.  611  The  national  do-  not-  call  database  will  allow  for  the  registration  of  wireless  telephone  numbers  for  those  subscribers  who  wish  to 
 avoid  live  telemarketing  calls  to  their  wireless  phones.  Wireless  subscribers  thus  have  a  simple  means  of  preventing  most  live  telemarketing  calls  if  they  so  desire.  612  Moreover,  relying  on  the 
 do-  not-  call  database  to  control  live  telephone  solicitations  recognizes  that  prohibiting  such  calls  to  wireless  numbers  may  unduly  restrict  telemarketers  ability  to  contact  those  consumers  who 
 do  not  object  to  receiving  telemarketing  calls  613  and  use  their  wireless  phones  as  either  their  primary  or  only  phone.  614 


 167.  The  Commissions  rules  provide  that  companies  making  telephone  solicitations  to  residential  telephone  subscribers  must  comply  with  time  of  day  restrictions  and  must  institute 
 procedures  for  maintaining  do-  not-  call  lists.  615  For  the  reasons  described  above,  616  we  conclude  that  these  rules  apply  to  calls  made  to  wireless  telephone  numbers.  We  believe  that  wireless 
 subscribers  should  be  afforded  the  same  protections  as  wireline  subscribers.  617 
 2.  Wireless  Number  Portability  and  Pooling 
 168.  Based  on  the  evidence  in  the  record,  we  find  that  it  is  not  necessary  to  add  rules  to  implement  the  TCPA  as  a  result  of  the  introduction  of  wireless  LNP  and  thousands-  block 


 number  pooling.  The  TCPA  rules  prohibiting  telemarketers  from  placing  autodialed  and  prerecorded  message  calls  to  wireless  numbers  have  been  in  place  for  twelve  years.  618  Further, 
 the  Commissions  pooling  requirements  have  been  in  place  for  several  years  and  the  porting  requirements  have  been  in  place  for  over  five  years.  Accordingly,  telemarketers  have  received 
 sufficient  notice  of  these  requirements  in  order  to  develop  business  practices  that  will  allow  them  to  continue  to  comply  with  the  TCPA. 


 611  We  note,  however,  that  the  TCPA  already  prohibits  live  solicitation  calls  to  wireless  numbers  using  an 
 autodialer.  See  47  U.  S.  C.    227(  b)(  1). 
 612  Registration  on  the  do-  not-  call  database  will  not  prevent  calls  from  entities  that  have  an  established  business 
 relationship  with  a  wireless  subscriber.  Wireless  subscribers  who  receive  such  live  calls  can  easily  make  a  company-  specific  do-  not-  call  request.  Moreover,  we  note  that  the  record  reveals  that  telemarketing  to  wireless 


 numbers  is  not  widespread  at  this  time. 
 613  See  Bell  South  Comments  at  6-  7;  ARDA  Comments  at  12. 


 614  A  USA  Today/  CNN/  Gallop  poll  found  that  almost  one  in  five  mobile  telephony  users  regard  their  wireless 
 phone  as  their  primary  phone.  2002  CMRS  Competition  Report,  Section  II.  A.  1.  e,  citing  Michelle  Kessler,  18%  See  Cellphones  as  Their  Main  Phone,  USA  Today,  Feb.  1,  2002. 


 615  See  47  C.  F.  R.    64.1200(  e). 
 616  See  supra  paras.  33-  36.  See  also  47  U.  S.  C.    227(  b)(  1)(  A)(  iii). 
 617  See,  e.  g.,  Citigroup  Comments  at  6;  Cingular  Wireless  Comments  at  6-  7;  John  Shaw  Reply  Comments  at  14. 
 618  See  supra  paras.  160-  163. 
102

 Federal  Communications  Commission  FCC  03-  153 
 103 
 169.  Additionally,  telemarketers  have  taken  measures  in  the  past  to  identify  wireless  numbers,  and  there  is  no  indication  that  these  measures  would  not  continue  to  be  effective  for 
 identifying  wireless  numbers  affected  by  pooling  and  porting.  As  noted  above,  the  industry  currently  makes  use  of  a  variety  of  tools  to  enable  it  to  avoid  making  prohibited  calls.  As 
 discussed  in  detail  supra,  619  the  record  provides  a  sampling  of  methods,  including  the  DMAs  Wireless  Telephone  Suppression  Service,  that  telemarketers  use  to  avoid  making  prohibited 
 calls  to  wireless  numbers.  620 
 170.  LNP  and  pooling  do  not  make  it  impossible  for  telemarketers  to  comply  with  the  TCPA.  The  record  demonstrates  that  information  is  available  from  a  variety  of  sources  to  assist 


 telemarketers  in  determining  which  numbers  are  assigned  to  wireless  carriers.  For  example,  NeuStar  as  the  North  American  Numbering  Plan  Administrator,  the  National  Pooling 
 Administrator,  and  the  LNP  Administrator  makes  information  available  that  can  assist  telemarketers  in  identifying  numbers  assigned  to  wireless  carriers.  Also,  other  commercial 
 enterprises  such  as  Telcordia,  the  owner-  operator  of  the  Local  Exchange  Routing  Guide  (LERG)  maintain  information  that  can  assist  telemarketers  in  identifying  numbers  assigned  to  wireless 
 carriers.  We  acknowledge  that  beginning  November  24,  2003,  numbers  previously  used  for  wireline  service  could  be  ported  to  wireless  service  providers  and  that  telemarketers  will  need  to 
 take  the  steps  necessary  to  identify  these  numbers.  We  also  note  that  there  are  various  solutions  that  will  enable  telemarketers  to  identify  wireless  numbers  in  a  pooling  and  number  portability 
 environment.  We  decline  to  mandate  a  specific  solution,  but  rather  rely  on  the  telemarketing  industry  to  select  solutions  that  best  fit  telemarketers  needs.  The  record  demonstrates  that 
 telemarketers  have  found  adequate  methods  in  the  past  to  comply  with  the  TCPAs  prohibition  on  telephone  calls  using  an  autodialer  or  an  artificial  or  prerecorded  voice  message  to  any 
 telephone  number  assigned  to  a  cellular  telephone  service,  a  paging  service,  or  any  service  for  which  the  called  party  is  charged  for  the  call.  We  expect  telemarketers  to  continue  to  make  use 
 of  the  tools  available  in  the  marketplace  in  order  to  ensure  continued  compliance  with  the  TCPA.  621 


 171.  Moreover,  the  record  indicates  that  telemarketing  to  wireless  phones  is  not  a  significant  problem,  indicating  that  the  industries  voluntary  efforts  have  been  successful.  622 
 Commenters  further  declare  that  the  wireless  and  telemarketing  industries  have  been  actively  working  together  to  ensure  that  telemarketing  does  not  become  a  problem  for  wireless 
 customers. 
 172.  Finally,  we  reject  proposals  to  create  a  good  faith  exception  for  inadvertent  autodialed  or  prerecorded  calls  to  wireless  numbers  and  proposals  to  create  implied  consent 


 619  See  supra  para.  163. 
 620  Cingular  Wireless  Comments  at  5;  DMA  Comments  at  35;  Letters  from  Neustar  to  FCC,  filed  January  23, 
 2003  and  May  5,  2003. 
 621  See  Letter  from  Neustar  to  FCC,  filed  June  4,  2003. 


 622  ABA  Comments  at  5;  AT&  T  Wireless  Comments  at  29;  Cingular  Wireless  Comments  at  4;  ATA  Reply 
 Comments  at  78;  AT&  T  Wireless  Reply  Comments  at  21. 
103

 Federal  Communications  Commission  FCC  03-  153 
 104 
 because  we  find  that  there  are  adequate  solutions  in  the  marketplace  to  enable  telemarketers  to  identify  wireless  numbers.  623 
 XII.  CALLER  IDENTIFICATION 
 A.  Background 
 173.  In  the  1992  TCPA  Order,  the  Commission  considered  whether  to  require  telemarketers  to  use  a  special  area  code  or  telephone  number  prefix  that  would  allow  consumers 


 to  block  unwanted  telephone  solicitations  using  a  caller  identification  (caller  ID)  service.  Based  on  cost  and  the  technological  uncertainties  associated  with  implementation,  the  Commission 
 declined  to  adopt  any  type  of  network  technologies  to  accomplish  the  objectives  of  the  TCPA.  624 
 174.  In  the  2002  Notice,  the  Commission  sought  comment  on  whether  network  technologies  have  been  developed  over  the  last  decade  that  may  allow  consumers  to  avoid 


 receiving  unwanted  telephone  solicitations.  The  Commission  sought  comment  specifically  on  whether  to  require  telemarketers  to  transmit  the  name  and  telephone  number  of  the  calling  party, 
 when  possible,  or  prohibit  them  from  blocking  or  altering  the  transmission  of  such  information.  625  Comments  filed  by  consumers,  state  utility  commissions,  and  wireless  service 
 providers  generally  support  a  requirement  that  telemarketers  transmit  caller  identification  information.  626  Consumers  are  frustrated  by  the  failure  of  many  telemarketers  to  transmit  caller 
 ID  information,  which,  under  certain  circumstances,  makes  it  difficult  for  consumers  to  enforce  the  TCPA.  627  Commenters  also  noted  that  the  increased  use  of  predictive  dialers  has  led  to  a 
 corresponding  increase  in  the  number  of  hang-  ups.  Caller  ID  information  would  allow  consumers,  they  contend,  to  identify  those  telemarketers  responsible  for  hang-  up  calls.  628  Some 


 623  See  ATA  Comments  at  134-  36;  BMO  Financial  Group  Comments  at  6;  Sprint  Comments  at  21;  ATA  Reply 
 Comments  at  82.  Commenters  also  suggest  other  exceptions,  such  as  where  a  subscriber  uses  wireless  as  his  sole  telephone  service,  AGF  Comments  at  1,  or  where  the  subscriber  provides  his  wireless  number  as  a  contact  number 


 to  a  business.  Id.  See  also  Bank  of  America  Comments  at  6;  CBA  Comments  at  9;  BellSouth  Comments  at  6-  7. 
 624  See  1992  TCPA  Order,  7  FCC  Rcd  at  8762,  para.  17. 


 625  2002  Notice,  17  FCC  Rcd  at  17473,  para  22. 
 626  Thomas  Pechnik  Comments  at  4;  TOPUC  Comments  at  3;  Wayne  G.  Strang  Comments  at  15;  Michael  C. 
 Worsham  Comments  at  4;  Samuel  E.  Whitley  Comments  at  2;  HFS  Comments  at  6;  CTIA  Comments  at  7;  Michael  J.  Blitch  Comments  at  5;  AT&  T  Wireless  Comments  at  23;  ARDA  Comments  at  9;  Louis  J  Hoppman  Jr. 


 Comments;  PUC  of  Ohio  Comments  at  19;  TN  AG  Comments  at  13;  DialAmerica  Comments  at  11-  12;  Stewart  Abramson  Comments  at  3;  Thomas  F.  Kirby  Comments;  David  Griffith  Comments;  Ghita  &  Stephan  Strain 
 Comments. 
 627  See,  e.  g.,  Brad  Totten  Comments  at  3;  DC  Hunter  Comments;  James  D.  Gagnon  Comments;  Brian  Klug 
 Comments;  Thomas  Pechnik  Comments  at  4;  NCL  Comments  at  3;  EPIC  Comments  at  12;  Verizon  Reply  Comments  at  12. 


 628  See,  e.  g.,  F.  Jenny  Holder  Comments  at  1;  Thomas  Callahan  Comments;  Michael  C.  Worsham  Comments  at  2; 
 NCL  Comments  at  4;  Gregory  S.  Reichenbach  Comments;  TOPUC  Comments  at  6-  7;  EPIC  Comments  at  12;  Stewart  Abramson  Comments  at  3;  Thomas  Pechnik  Comments  at  4;  AGF  Comments  at  4;  Joe  Shields  Comments  at 


 7. 
104

 Federal  Communications  Commission  FCC  03-  153 
 105 
 commenters  stated  that  the  inability  to  identify  callers  has  led  them  to  purchase  other  tools,  such  as  the  telezapper,  to  try  to  stop  unwanted  solicitation  calls.  629  Most  commenters  that  addressed 
 these  issues  support  a  prohibition  against  the  blocking  of  caller  ID  information.  630  Several  parties  stated  that  the  Commission  should  prohibit  blocking  independent  of  any  caller  ID 
 mandate.  631  It  was  also  suggested  that  the  Commission  could  prohibit  tampering  with  data  or  providing  false  data.  632 


 175.  Some  industry  members  suggest  that  the  transmission  of  caller  ID  information  may  not  be  technically  possible  in  all  circumstances.  633  They  also  maintain  that  a  caller  ID 
 requirement  could  be  costly  for  telemarketers.  634  One  particular  concern  raised  by  parties  opposed  to  a  caller  ID  mandate  is  the  technical  feasibility  of  transmitting  caller  ID  information 
 when  using  private  branch  exchanges  (PBX).  WorldCom  maintains  that,  in  situations  where  telemarketers  use  a  PBX  that  connects  to  their  telephone  company  through  typical  T-  1  trunks, 
 Calling  Party  Number  (CPN)  cannot  be  transmitted.  635  WorldCom  contends  that  Integrated  Services  Digital  Network  (ISDN)  T-  1  trunks  may  be  capable  of  transmitting  CPN,  but  that 
 typical  T-  1  trunks  do  not  have  this  capability.  636  DialAmerica  notes  that  it  has  been  delivering  CPN  for  over  two  years  using  regular  T-  1  trunk  groups  provisioned  by  AT&  T.  637  DialAmerica 
 transmits  an  outgoing  number  which  is  captured  by  caller  ID  equipment.  If  a  consumer  chooses  to  call  that  number,  the  local  exchange  carrier  (LEC)  forwards  the  call  to  DialAmericas 


 629  OPC-  DC  Comments  at  6;  Janice  G.  Farkosh  Comments;  Leslie  Price  Comments;  Josephine  K.  Presley 
 Comments. 
 630  See,  e.  g.,  Verizon  Comments  at  18;  PRC  Comments  at  5;  NYSCPB  Comments  at  9;  PUC  of  Ohio  Comments  at 
 19. 
 631  OPC-  DC  Comments  at  6;  Owen  ONeill  Comments  at  1;  TOPUC  Comments  at  3;  Technion  Comments  at  6-  7; 
 Verizon  Comments  at  18;  PUC  of  Ohio  Comments  at  19,  NASUCA  Comments  at  3;  Thomas  Pechnik  Comments  at  4.  But  see  NAA  Comments  at  17;  Nextel  Comments  at  17-  18;  Comcast  Comments  at  14;  Teleperformance 


 Comments  at  3;  ABA  Comments  at  3  (should  restrict  caller  ID  blocking,  but  not  require  the  transmission  of  caller  ID). 


 632  Stewart  Abramson  Comments  at  3. 
 633  Teleperformance  Comments  at  3;  WorldCom  Comments  at  45;  DMA  Reply  Comments  at  30;  Mastercard 
 Comments  at  7;  Nextel  Comments  at  17-  18;  SER  Comments  at  2;  Sprint  Comments  at  7;  ECN  Comments  at  9  (asserting  that  telemarketers  will  provide  caller  ID  when  technologically  feasible,  and  thus,  the  Commission  need 


 not  adopt  a  caller  ID  requirement). 
 634  Teleperformance  Comments  at  3;  WorldCom  Comments  at  45;  DMA  Reply  Comments  at  30;  Nextel  Comments 
 at  18;  SER  Comments  at  2;  Sprint  Comments  at  7-  8. 
 635  WorldCom  Reply  Comments  at  23. 


 636  WorldCom  Reply  Comments  at  23.  We  note  that  both  typical  T-  1  and  ISDN  trunks  contain  24  channels. 
 ISDN  trunks  dedicate  one  channel  specifically  to  data  transmission,  while  typical  T-  1  lines  dedicate  all  24  channels  to  voice  transmission. 


 637  DialAmerica  Comments,  Attachment  A  at  1. 
105

 Federal  Communications  Commission  FCC  03-  153 
 106 
 customer  service  center.  638  DialAmerica  asserts  that  ISDN  T-  1  trunks  are  available  from  all  carriers  and  enable  a  user  to  control  whether  CPN  is  delivered  and  what  telephone  number  is 
 displayed.  639  WorldCom  notes  that  even  if  we  accept  DialAmericas  assertion  that  ISDN  trunks  are  universally  available,  carriers  would  have  to  upgrade  network  switches  to  accommodate 
 additional  digital  switch  ports  necessitated  by  telemarketers  shift  to  ISDN-  PRI  trunks.  640 
 176.  Telemarketers  also  raised  technical  concerns  that  the  ability  to  transmit  caller  ID  information  is  dependent  on  the  deployment  of  Signaling  System  7  (SS7).  641  They  argue  that 


 SS7  is  not  nationally  deployed  and  thus  the  capability  to  transmit  caller  ID  is  not  available  throughout  the  country.  642  Moreover,  they  maintain  that  Commission  rules  exempt  PBX  and 
 Centrex  systems  from  existing  caller  ID  requirements  because  some  of  them  cannot  transmit  CPN,  643  and  not  all  carriers  are  able  or  permitted  to  transmit  CPN,  if  they  lack  blocking 
 capability.  644  The  DMA  and  WorldCom  expressed  concern  that  regardless  of  whether  the  telemarketer  is  able  to  transmit  CPN,  consumers  will  expect  it,  and  may  incorrectly  believe  a 
 company  has  violated  the  rules.  645 
 177.  Several  parties  argue  that  even  if  a  telemarketer  can  transmit  CPN  information,  how  to  transmit  a  number  that  is  useful  to  consumers  remains  a  challenge.  646  Comments  were 


 mixed  on  what  information  actually  needed  to  be  transmitted  for  purposes  of  caller  ID.  Several  parties  opined  that  the  name  of  the  telemarketing  operator  would  be  adequate  identification.  647 
 Others  asserted  that  the  name  of  the  company  on  whose  behalf  the  call  was  being  made  should  be  provided.  648  Emergency  Communications  Network  argued  that  a  companys  website 
 information  should  be  a  permitted  as  a  substitute  for  the  name  and  phone  number.  649 


 638  DialAmerica  Comments,  Attachment  A  at  2. 
 639  DialAmerica  Comments,  Attachment  A  at  1. 
 640  WorldCom  Reply  Comments  at  24. 
 641  Signaling  System  7  (SS7)  refers  to  a  carrier  to  carrier  out-  of-  band  signaling  network  used  for  call  routing, 
 billing  and  management.  See  47  C.  F.  R.    64.1600(  f). 
 642  DMA  Reply  Comments  at  30. 


 643  See  47  C.  F.  R.    64.1601(  d). 
 644  DMA  Reply  Comments  at  29-  30.  But  see  NASUCA  Comments  at  9;  Verizon  Comments  at  18  (indicating  that 
 caller  ID  is  technically  viable  because  CPN  is  transmitted  to  the  LECs). 
 645  DMA  Reply  Comments  at  30;  WorldCom  Reply  Comments  at  26. 


 646  See,  e.  g.,  DMA  Reply  Comments  at  30. 
 647  Jeff  Mitchell  Comments  at  1;  Martin  C.  Kaplan  Comments  at  2;  City  of  New  Orleans  Comments  at  8. 
 648  Jeff  Mitchell  Comments  at  1;  NCL  Comments  at  4;  Xpedite  Systems  Comments  at  12;  PRC  Comments  at  5. 
 649  ECN  Comments  at  4. 
106

 Federal  Communications  Commission  FCC  03-  153 
 107 
 178.  The  FTCs  amended  TSR  mandates  transmission  of  caller  ID  information  and  prohibits  any  seller  or  telemarketer  from  failing  to  transmit  or  cause  to  be  transmitted  the 
 telephone  number,  and  when  made  available  by  the  telemarketers  carrier,  the  name  of  the  telemarketer,  to  any  caller  identification  service  in  use  by  a  recipient  of  a  telemarketing  call.  650 
 Under  the  FTCs  rule,  telemarketers  may  transmit  any  number  associated  with  the  telemarketer  that  allows  the  called  consumer  to  identify  the  caller.  651  The  FTC  concluded  that  transmission  of 
 caller  ID  would  provide  increased  accountability  and  was  technically  feasible  at  minimal  costs  to  telemarketers.  The  DMA  stated  that  it  was  concerned  that  technical  issues  were  not  adequately 
 taken  into  account  during  the  FTCs  proceeding.  The  DMA  requested  that  the  FCC  initiate  a  comprehensive  review  of  the  technical  feasibility  of  caller  ID.  652 


 B.  Discussion 
 179.  The  Commission  has  determined  to  require  all  sellers  and  telemarketers  to  transmit  caller  ID  information,  regardless  of  their  calling  systems.  In  addition,  any  person  or 


 entity  engaging  in  telemarketing  is  prohibited  from  blocking  the  transmission  of  caller  ID  information.  Caller  ID  information  must  include  either  ANI  or  CPN  and,  when  available  by  the 
 telemarketers  carrier,  the  name  of  the  telemarketer.  If  the  information  required  is  not  passed  through  to  the  consumer,  through  no  fault  of  the  telemarketer  originating  the  call,  then  the 
 telemarketer  will  not  be  held  liable  for  failure  to  comply  with  the  rules.  653  In  such  a  circumstance,  the  telemarketer  must  provide  clear  and  convincing  evidence  that  the  caller  ID 
 information  could  not  be  transmitted.  However,  the  Commission  concurs  with  the  FTC  that  caller  ID  information  can  be  transmitted  cost  effectively  for  the  vast  majority  of  calls  made  by 
 telemarketers.  654  Caller  ID  allows  consumers  to  screen  out  unwanted  calls  and  to  identify  companies  that  they  wish  to  ask  not  to  call  again.  Knowing  the  identity  of  the  caller  is  also 
 helpful  to  consumers  who  feel  frightened  or  threatened  by  hang-  up  and  dead  air  calls.  655  We  disagree  with  those  commenters  who  argue  that  caller  ID  information  only  benefits  those 
 consumers  who  subscribe  to  caller  ID  services.  656  Consumers  can  also  use  the  *69  feature  to 
 650  FTC  Order,  68  Fed.  Reg.  at  4623. 
 651  FTC  Order,  68  Fed.  Reg.  at  4625. 
 652  DMA  Reply  Comments  at  30.  The  DMA  notes  that  the  FCC  has  the  requisite  experience  to  evaluate  technical 
 feasibility  and  a  more  comprehensive  view  of  the  larger  issues  of  how  a  caller  ID  requirement  might  fit  into  the  regulation  of  the  communications  network  as  a  whole.  See  DMA  Reply  Comments  at  29. 


 653  See  WorldCom  Reply  Comments  at  26  (arguing  that  requiring  caller  ID  could  create  an  expectation  in  the 
 minds  of  consumers  that  they  should  always  receive  the  information  and  that  such  a  regulation  creates  a  situation  where  companies  will  be  unfairly  accused  of  breaking  the  law,  and  as  a  consequence,  face  undue  litigation  and 


 harm  to  their  reputations). 
 654  See  Nextel  Further  Comments  at  16  (stating  that  most  telemarketers  are  currently  capable  of  transmitting  caller 
 ID  using  their  existing  equipment,  and  that  the  FCC  should  adopt  an  approach  similar  to  the  FTCs,  if  it  chooses  to  regulate  the  transmission  of  caller  ID  for  telemarketing  calls). 


 655  Cynthia  Stichnoth  Comments;  Stewart  Abramson  Comments  at  1. 
 656  See,  e.  g.,  Sprint  Comments  at  7-  8,  CBA  Comments  at  8. 
107

 Federal  Communications  Commission  FCC  03-  153 
 108 
 obtain  caller  ID  information  transmitted  by  a  telemarketer.  657  Caller  ID  also  should  increase  accountability  and  provide  an  important  resource  for  the  FCC  and  FTC  in  pursuing  enforcement 
 actions  against  TCPA  and  TSR  violators.  658 
 180.  We  conclude  that  while  SS7  capability  is  not  universally  available,  the  vast  majority  of  the  United  States  has  access  to  SS7  infrastructure.  The  SS7  network  contains 


 functionality  to  transmit  both  the  CPN  and  the  charge  number.  659  Under  the  Commissions  rules,  with  certain  limited  exceptions,  common  carriers  using  SS7  and  offering  or  subscribing  to  any 
 service  based  on  SS7  functionality  are  required  to  transmit  the  CPN  associated  with  an  interstate  call  to  connecting  carriers.  660  Regardless  of  whether  SS7  is  available,  a  LEC  at  the  originating 
 end  of  a  call  must  receive  and  be  able  to  transmit  the  Automated  Number  Identification  (ANI)  to  the  connecting  carrier,  661  as  the  ANI  is  the  number  transmitted  through  the  network  that 
 identifies  the  calling  party  for  billing  purposes.  Thus,  we  determine  that  telemarketers  must  ensure  that  either  CPN  or  ANI  is  made  available  for  all  telemarketing  calls  in  order  to  satisfy 
 their  caller  ID  requirements.  Whenever  possible,  CPN  is  the  preferred  number  and  should  be  transmitted.  662  Consistent  with  the  FTCs  rules,  CPN  can  include  any  number  associated  with 
 the  telemarketer  or  party  on  whose  behalf  the  call  is  made,  that  allows  the  consumer  to  identify  the  caller.  663  This  includes  a  number  assigned  to  the  telemarketer  by  its  carrier,  the  specific 
 number  from  which  a  sales  representative  placed  a  call,  the  number  for  the  party  on  whose  behalf  the  telemarketer  is  making  the  call,  or  the  sellers  customer  service  number.  Any  number 
 supplied  must  permit  an  individual  to  make  a  do-  not-  call  request  during  regular  business  hours  for  the  duration  of  the  telemarketing  campaign.  664 


 657  The  *69  feature,  available  through  many  subscribers  telephone  service  providers,  provides  either:  (1) 
 information  regarding  the  last  incoming  call,  and  the  option  to  dial  the  caller  back,  or  (2)  the  ability  to  return  the  last  incoming  call.  Call  information,  however,  would  not  be  available  for  an  incoming  call,  if  the  caller  failed  to 


 transmit  caller  ID  information  or  blocked  such  information. 
 658  See  FTC  Order,  68  Fed.  Reg.  at  4623-  24. 


 659  Charge  number  is  defined  in  47  C.  F.  R.  64.1600(  d)  and  refers  to  the  delivery  of  the  calling  partys  billing 
 number  by  a  local  exchange  carrier  for  billing  or  routing  purposes,  and  to  the  subsequent  delivery  of  such  number  to  end  users. 


 660  See  47  C.  F.  R.    64.1600,  64.1601. 
 661  The  term  ANI  refers  to  the  delivery  of  the  calling  partys  billing  number  by  a  local  exchange  carrier  to  any 
 interconnecting  carrier  for  billing  or  routing  purposes,  and  to  the  subsequent  delivery  to  end  users.  See  47  C.  F.  R.    64.1600(  b).  ANI  is  generally  inferred  by  the  switch.  Each  line  termination  on  the  telco  switch  corresponds  to  a 


 different  phone  number  for  ANI. 
 662  Provision  of  Caller  ID  information  does  not  obviate  the  requirement  for  a  caller  to  verbally  supply 
 identification  information  during  a  call.  See  47  C.  F.  R.    64.1200(  e)(  iv). 
 663  See  FTC  Order,  68  Fed.  Reg.  at  4623-  28. 


 664  This  would  mean  9:  00  a.  m.    5:  00  p.  m.  Monday  through  Friday.  A  seller  or  telemarketer  calling  on  behalf  of  a 
 seller  must  be  able  to  record  do-  not-  call  requests  at  the  number  transmitted  to  consumers  as  caller  ID.  Therefore,  if  the  person  answering  the  calls  at  this  number  is  not  the  sales  representative  who  made  the  call  or  an  employee  of 


 (continued.) 
108

 Federal  Communications  Commission  FCC  03-  153 
 109 
 181.  As  discussed  above,  some  commenters  state  that  it  is  not  technically  feasible  for  telemarketers  to  transmit  caller  ID  information  when  using  a  PBX  and  typical  T-  1  trunks.  665  As 
 noted  by  NASUCA,  the  Commissions  rules  exempt  from  the  current  caller  ID  rules,  PBX  and  Centrex  systems  which  lack  the  capability  to  pass  CPN  information.  Regardless  of  whether  a 
 call  is  made  using  a  typical  T-  1  trunk  or  an  ISDN  trunk,  ANI  is  transmitted  to  the  Local  Exchange  Carrier  for  billing  purposes.  666  With  both  PBX  and  Centrex  systems,  the  carrier  can 
 determine  the  billing  number  from  the  physical  line  being  used  to  make  a  call,  even  if  the  billing  number  is  not  transmitted  along  that  line  to  the  carrier.  We  are  cognizant  of  the  fact  that  with 
 PBX  and  Centrex  systems,  the  billing  number  could  be  associated  with  multiple  outgoing  lines.  Nevertheless,  telemarketers  using  PBX  or  Centrex  systems  are  required  under  the  new  rules  not 
 to  block  ANI,  at  a  minimum,  for  caller  ID  purposes. 
 182.  We  recognize  that  ISDN  technology  is  preferred,  as  it  presents  the  opportunity  to  transmit  both  CPN  and  ANI.  However,  in  situations  where  existing  technology  permits  only  the 


 transmission  of  the  ANI  or  charge  number,  then  the  ANI  or  charge  number  will  satisfy  the  Commissions  rules,  provided  it  allows  a  consumer  to  make  a  do-  not-  call  request  during  regular 
 business  hours.  667  By  allowing  transmission  of  ANI  or  charge  number  to  satisfy  the  caller  ID  requirement,  we  believe  that  carriers  need  not  incur  significant  costs  to  upgrade  T-  1  and  ISDN 
 switches.  668  For  these  same  reasons,  we  also  believe  that  mandating  caller  ID  will  not  create  a  competitive  advantage  towards  particular  carriers.  669  As  typical  T-  1  technology  is  upgraded  to 
 ISDN  technology,  we  expect  that  telemarketers  will  increasingly  be  able  to  transmit  the  preferred  CPN  instead  of  ANI  or  charge  number. 


 183.  Finally,  the  record  strongly  supports  a  prohibition  on  blocking  caller  ID  information.  670  Both  NCL  and  NASUCA  state  that  there  is  no  valid  reason  why  a  telemarketer 
 should  be  allowed  to  intentionally  block  the  transmission  of  caller  ID.  671  We  conclude  that  the  (Continued  from  previous  page) 
 the  seller  or  telemarketer  who  made  the  call,  or  if  the  telemarketer  is  using  an  automated  system  to  answer  the  calls,  the  seller  is  nevertheless  responsible  for  ensuring  that  any  do-  not-  call  request  is  recorded  and  the  consumers 
 name,  if  provided,  and  telephone  number  are  placed  on  the  sellers  do-  not-  call  list  at  the  time  the  request  is  made.  See  also  supra  note  492. 


 665  See  supra  para.  175. 
 666  See  Telcordia  Notes  on  the  Networks    Notes  Design  and  Configuration,  Telcordia  Technologies  Special 
 Report  SR-  2275,  Issue  4,  October  2000,  pp.  4-  30.  See  also,  Administration  of  the  North  American  Numbering  Plan,  Carrier  Identification  Codes  (CICs),  CC  Docket  No.  92-  237,  Second  Report  and  Order,  12  FCC  Rcd  8024 


 (1997). 
 667  We  note  that  a  telemarketer  using  a  service  that  prevents  the  transmission  of  the  required  caller  ID  information 
 will  be  in  violation  of  the  Commissions  caller  ID  rules. 
 668  See  WorldCom  Reply  Comments  at  26. 


 669  See,  e.  g.,  Discover  Comments  at  7;  DMA  Reply  Comments  at  30. 
 670  See,  e.  g.,  TOPUC  Comments  at  3;  Verizon  Comments  at  18;  Owen  ONeill  Comments  at  1;  Rob  McNeal 
 Comments;  Jeff  Mitchell  Comments  at  1. 
 671  NASUCA  Comments  at  8-  9;  NCL  Comments  at  3. 
109

 Federal  Communications  Commission  FCC  03-  153 
 110 
 caller  ID  requirements  for  commercial  telephone  solicitation  calls  do  not  implicate  the  privacy  concerns  associated  with  blocking  capability  for  individuals.  672  We  recognize  that  absent  a 
 prohibition  on  blocking,  a  party  could  transmit  CPN  in  accordance  with  the  new  rules  and  simultaneously  transmit  a  request  to  block  transmission  of  caller  ID  information.  Thus,  the 
 Commission  has  determined  to  prohibit  any  request  by  a  telemarketer  to  block  caller  ID  information  or  ANI. 


 184.  As  explained  above,  the  TCPA  seeks  primarily  to  protect  subscribers  from  unrestricted  commercial  telemarketing  calls.  Therefore,  the  Commission  has  determined  not  to 
 extend  the  caller  ID  requirements  to  tax-  exempt  nonprofit  organizations.  However,  the  caller  ID  rules  will  apply  to  all  other  companies  engaged  in  telemarketing,  and  the  existence  of  an 
 established  business  relationship  between  the  telemarketer  and  the  consumer  shall  not  be  an  exception  to  these  rules.  For  all  covered  entities,  the  effective  date  of  the  caller  ID  requirements 
 will  be  January  29,  2004.  673  This  will  provide  telemarketers  a  reasonable  period  of  time  to  obtain  or  update  any  equipment  or  systems  to  enable  them  to  transmit  caller  ID  information.  We 
 decline  to  extend  the  effective  date  beyond  January  29,  2004,  which  is  consistent  with  the  date  on  which  telemarketers  are  required  to  comply  with  the  FTCs  caller  ID  provision.  674 


 XIII.  UNSOLICITED  FACSIMILE  ADVERTISEMENTS 
 A.  Background 
 185.  The  TCPA  prohibits  the  use  of  any  telephone  facsimile  machine,  computer  or  other  device  to  send  an  unsolicited  advertisement  to  a  telephone  facsimile  machine.  675  An 


 unsolicited  advertisement  is  defined  as  any  material  advertising  the  commercial  availability  or  quality  of  any  property,  goods,  or  services  which  is  transmitted  to  any  person  without  that 
 persons  prior  express  invitation  or  permission.  676  The  TCPA  also  requires  those  sending  any  messages  via  telephone  facsimile  machines  to  identify  themselves  to  message  recipients.  677  In 


 672  See  47  C.  F.  R.    64.1601(  b). 
 673  See  new  rule  at  47  C.  F.  R.    64.1601(  e).  See  also  FTC  Further  Comments  (explaining  that  the  goals  of 
 regulatory  consistency  will  be  promoted  if  the  FCC  adopts  caller  ID  requirements  analogous  to  Amended  TSR  16  C.  F.  R.    310.4(  a)(  7)). 


 674  See  Notices  of  Ex  Parte  Presentations  from  WorldCom  to  FCC,  filed  May  23,  2003  and  June  16,  2003 
 (advocating  a  13-  month  implementation  period  for  the  caller  ID  rules).  See  also  FTC  Further  Comments  (explaining  that  the  goals  of  regulatory  consistency  will  be  promoted  if  the  FCC  adopts  caller  ID  requirements 


 analogous  to  Amended  TSR  16  C.  F.  R.    310.4(  a)(  7)). 
 675  47  U.  S.  C.    227(  b)(  1)(  C).  The  United  States  Court  of  Appeals  for  the  Eighth  Circuit  recently  upheld  the 
 TCPAs  provision  on  unsolicited  faxes  as  satisfying  the  constitutional  test  for  regulation  of  commercial  speech.  See  Missouri  ex  rel  Nixon  v.  American  Blast  Fax,  Inc.,  323  F.  3d  649  (8th  Cir.  2003)  (petition  for  rehearing 


 pending). 
 676  47  C.  F.  R.    64.1200(  f)(  5). 


 677  Specifically,  the  TCPA  provides  that  the  facsimile  include  in  a  margin  at  the  top  or  bottom  of  each  transmitted 
 page  of  the  message  or  on  the  first  page  of  the  transmission,  the  date  and  time  it  is  sent  and  an  identification  of  the  business,  other  entity,  or  individual  sending  the  message  and  the  telephone  number  of  the  sending  machine  or  of 


 (continued.) 
110

 Federal  Communications  Commission  FCC  03-  153 
 111 
 the  1992  TCPA  Order,  the  Commission  stated  that  the  TCPA  leaves  the  Commission  without  discretion  to  create  exemptions  from  or  limit  the  effects  of  the  prohibition.  678  It  noted,  however, 
 that  facsimile  transmission  from  persons  or  entities  that  have  an  established  business  relationship  with  the  recipient  can  be  deemed  to  be  invited  or  permitted  by  the  recipient.  679  The  Commission 
 sought  comment  on  the  effectiveness  of  these  regulations  and  on  any  developing  technologies,  such  as  computerized  fax  servers,  that  might  warrant  revisiting  the  rules  on  unsolicited  faxes.  680 
 We  specifically  asked  about  the  need  to  clarify  what  constitutes  prior  express  invitation  or  permission  for  purposes  of  sending  an  unsolicited  fax.  681 


 186.  The  record  indicates  that  some  consumers  feel  besieged  by  unsolicited  faxes;  682  others  explain  that  advertisers  continue  to  send  faxes  despite  asking  to  be  removed  from  senders 
 fax  lists.  683  Consumers  emphasize  that  the  burden  of  receiving  unsolicited  faxes  is  not  just  limited  to  the  cost  of  paper  and  toner,  but  includes  the  time  spent  reading  and  disposing  of  faxes, 
 the  time  the  machine  is  printing  an  advertisement  and  is  not  operational  for  other  purposes,  and  the  intrusiveness  of  faxes  transmitted  at  inconvenient  times,  including  in  the  middle  of  the 
 night.  684  Some  of  the  consumer  advocates  maintain  that  the  current  rules  are  ineffective  685  and  urge  the  Commission  to  take  tougher  measures  to  stop  unwanted  faxes  by  stricter  enforcement 
 measures,  686  including  higher  penalties.  A  few  home-  based  businesses  and  other  companies  maintain  that  facsimile  advertisements  interfere  with  receipt  of  faxes  connected  to  their  own 
 business,  and  that  the  time  spent  collecting  and  sorting  these  faxes  increases  their  labor  costs.  687 
 (Continued  from  previous  page)  such  business,  other  entity,  or  individual.  47  U.  S.  C.    227(  d)(  1)(  B).  The  Commission  determined  that  the 


 sender  of  a  facsimile  message  is  the  creator  of  the  content  of  the  message.  See  1997  Reconsideration  Order,  12  FCC  Rcd  at  4613,  para.  6. 


 678  1992  TCPA  Order,  7  FCC  Rcd  at  8779,  para.  54,  n.  87. 
 679  1992  TCPA  Order,  7  FCC  Rcd  at  8779,  para.  54,  n.  87. 
 680  2002  Notice,  17  FCC  Rcd  at  17482,  para.  37 
 681  2002  Notice,  17  FCC  Rcd  at  17482-  83,  para.  38.  The  Commission  sought  comment  specifically  on  the 
 Commissions  determination  that  a  prior  business  relationship  between  a  fax  sender  and  recipient  establishes  the  requisite  consent  to  receive  telephone  facsimile  advertisement  transmissions.  See  2002  Notice,  17  FCC  Rcd  at 


 17483,  para.  39. 
 682  Chris  Hernandez  Comments;  Damien  Blevins  Comments;  Peter  LeCody  Comments;  Joe  Shields  Comments  at 
 6;  Mathemaesthetics  Comments  at  2. 
 683  Anthony  Oppenheim  Comments;  W.  Allen  Wilkens,  Jr.  Comments. 


 684  J.  Greg  Coontz  Comments  at  15-  17. 
 685  NCL  Comments  at  6. 
 686  Dennis  C.  Brown  Comments  at  13;  City  of  New  Orleans  Comments  at  11. 
 687  Jim  Carter  Comments;  JC  Homola  Comments;  Autoflex  Comments  at  1-  2;  Rob  McNeal  Comments 
 (unsolicited  faxes  costs  company  tens  of  thousands  of  dollars  each  year  in  materials  and  employee  time);  see  also  NCL  Comments  at  6  ([  P]  eople  who  work  out  of  their  homes  are  especially  harmed  by  unsolicited  faxes,  which 


 use  up  their  paper  and  toner  and  tie  up  their  machines.);  Mathemaesthetics  Reply  Comments  at  7  ([  U]  nsolicited  (continued.) 
111

 Federal  Communications  Commission  FCC  03-  153 
 112 
 Industry  members  maintain  that  faxing  is  a  cost-  effective  way  to  reach  customers,  688  and  that  the  current  exemption  for  established  business  relationships  works  well,  689  particularly  for  small 
 businesses  for  whom  faxing  is  a  cheaper  way  to  advertise.  690 
 B.  Discussion 
 1.  Prior  Express  Invitation  or  Permission 
 187.  The  Commission  has  determined  that  the  TCPA  requires  a  person  or  entity  to  obtain  the  prior  express  invitation  or  permission  of  the  recipient  before  transmitting  an 


 unsolicited  fax  advertisement.  This  express  invitation  or  permission  must  be  in  writing  and  include  the  recipients  signature.  691  The  recipient  must  clearly  indicate  that  he  or  she  consents  to 
 receiving  such  faxed  advertisements  from  the  company  to  which  permission  is  given,  and  provide  the  individual  or  businesss  fax  number  to  which  faxes  may  be  sent. 


 188.  Established  Business  Relationship.  The  TCPA  does  not  act  as  a  total  ban  on  fax  advertising.  Persons  and  businesses  that  wish  to  advertise  using  faxes  may,  under  the  TCPA,  do 
 so  with  the  express  permission  of  the  recipients.  In  the  2002  Notice,  we  sought  comment  on  whether  an  established  business  relationship  between  a  fax  sender  and  recipient  establishes  the 
 requisite  consent  to  receive  telephone  facsimile  advertisements.  692  The  majority  of  industry  commenters  support  the  finding  that  facsimile  transmissions  from  persons  or  entities  that  have  an 
 established  business  relationship  with  the  recipient  can  be  deemed  to  be  invited  or  permitted  by  the  recipient.  693  These  commenters  maintain  that  eliminating  the  EBR  exemption  for  facsimile 
 advertisements  would  interfere  with  ongoing  business  relationships,  raise  business  costs,  and 


 (Continued  from  previous  page)  [fax]  ads  caused  my  business  fax  machine  to  become  prematurely  empty,  which  rendered  wholly  useless  the 
 equipment  my  small  business  crucially  depends  on  for  its  revenue.  When  a  customer  of  mine  a  short  time  later  attempted  to  fax  a  purchase  order  for  over  $3,000  worth  of  my  companys  product,  my  empty  fax  machine  was 
 not  able  to  capture  this  transaction  for  a  significant  period  of  time  (emphasis  in  original)). 
 688  ABM  Comments  at  4  (Members  have  found  that  targeted  fax  communication  is  cost-  effective  way  to  seek 
 renewal  request  forms  from  existing  subscribers,  and  to  communicate  with  subscribers  about  industry  trade  shows.). 


 689  MPA  Comments  at  22;  Nextel  Comments  at  25;  NADA  Comments  at  2;  Scholastic  Comments  at  13;  Reed 
 Comments  at  2-  3. 
 690  NADA  Comments  at  2;  NFIB  Comments  at  3. 


 691  The  term  signature  in  the  amended  rule  shall  include  an  electronic  or  digital  form  of  signature,  to  the  extent 
 that  such  form  of  signature  is  recognized  as  a  valid  signature  under  applicable  federal  law  or  state  contract  law.  See,  e.  g.,  Cendant  Comments  at  6. 


 692  2002  Notice,  17  FCC  Rcd  at  17483,  para.  39. 
 693  ABM  Comments  at  9;  DIRECTV  Comments  at  9-  19;  Hunton  &  Williams  Comments  at  5-  6;  Lorman  Further 
 Comments  at  7  (noting  that  parties  with  an  established  business  relationship  expect  to  be  in  communications  with  companies  with  which  they  do  business,  and  that  any  company  that  transmits  ads  by  fax  should  be  required  to 


 maintain  a  company-  specific  do-  not-  fax  list). 
112

 Federal  Communications  Commission  FCC  03-  153 
 113 
 limit  the  flow  of  valuable  information  to  consumers.  694  They  urge  the  Commission  to  amend  the  rules  to  expressly  provide  for  the  EBR  exemption.  695  Conversely,  the  majority  of  consumer 
 advocates  argue  that  the  TCPA  requires  companies  to  obtain  express  permission  from  consumers  even  their  existing  customers  before  transmitting  a  fax  to  a  consumer.  696  Some 
 consumer  advocates  maintain  that  the  Commission  erred  in  its  1992  determination  that  a  consumer,  by  virtue  of  an  established  business  relationship,  has  given  his  or  her  express 
 invitation  or  permission  to  receive  faxes  from  that  company.  697  They  urge  the  Commission  to  eliminate  the  EBR  exemption,  noting  that  Congress  initially  included  in  the  TCPA  an  EBR 
 exemption  for  faxes,  but  removed  it  from  the  final  version  of  the  statute.  698 
 189.  We  now  reverse  our  prior  conclusion  that  an  established  business  relationship  provides  companies  with  the  necessary  express  permission  to  send  faxes  to  their  customers.  As 


 of  the  effective  date  of  these  rules,  the  EBR  will  no  longer  be  sufficient  to  show  that  an  individual  or  business  has  given  their  express  permission  to  receive  unsolicited  facsimile 
 advertisements.  699  The  record  in  this  proceeding  reveals  consumers  and  businesses  receive  faxes  they  believe  they  have  neither  solicited  nor  given  their  permission  to  receive.  Recipients  of 
 these  faxed  advertisements  assume  the  cost  of  the  paper  used,  the  cost  associated  with  the  use  of 
 694  Nextel  Reply  Comments  at  6. 
 695  See  Xpedite  Reply  Comments  at  6;  ABM  Comments  at  4-  5;  Nextel  Comments  at  25;  DIRECTV  Comments  at 
 9-  10;  Lorman  Further  Comments  at  8. 
 696  Biggerstaff  Reply  Comments  at  22  (noting  that  express  permission  can  easily  be  requested  from  existing 
 customers,  as  paperwork  is  exchanged  between  merchants  and  their  customers  regularly);  NAAG  Comments  at  31  (stating  that  treating  express  consent  on  a  case-  by-  case  basis  can  be  costly  and  time-  consuming,  as  consent  is  the 


 main  defense  asserted  by  fax  advertisers.  NAAG  suggests  that  the  Commission  adopt  a  concrete  definition  of  express,  meaning  definite,  explicit  or  direct,  and  not  left  to  inference). 


 697  NAAG  Comments  at  31-  32  (arguing  that  creating  an  established  business  relationship  exception  runs  contrary 
 to  the  clear  wording  of  the  statute.  The  TCPA  defines  unsolicited  advertisement  as  an  advertisement  sent  to  a  person  without  that  persons  prior  express  invitation  or  permission.    A  business  relationship  exemption  would 


 rely  on  implied  invitation  or  permission  which  is  contrary  to  the  clear  wording  of  the  statute.  (emphasis  in  original;  footnotes  omitted));  Mark  R.  Lee  Comments;  Biggerstaff  Comments  at  3;  John  Holcomb  Comments  at  4; 
 Kondos  &  Kondos  Comments  at  3-  4;  Marc  A.  Wites  Comments;  Wayne  G.  Strang  Comments  at  12;  Michael  C.  Worsham  Comments  at  13;  Wayne  G.  Strang  Reply  Comments  at  16.  But  see  NYSCPB  Comments  at  18 
 (recommends  retaining  the  EBR  as  permission  to  receive  faxes). 
 698  See  Kondos  &  Kondos  Comments  at  1-  2  and  Exhibit  A  (noting  that  three  versions  of  the  House  predecessor 
 bill  to  the  TCPA  included  an  EBR  exemption  for  unsolicited  fax  ads.  Not  only  is  an  EBR  not  a  defense  to  unsolicited  fax  advertising  under  the  TCPA,  the  U.  S.  Congress  specifically  included  such  a  defense  in  numerous 


 predecessor  TCPA  bills  and  then  excluded  it  in  the  law  which  overwhelmingly  passed  in  1991.  Kondos  &  Kondos  Comments  at  2);  John  Holcomb  Comments  at  4;  Biggerstaff  Comments  at  3. 


 699  See  1992  TCPA  Order,  7  FCC  Rcd  at  8779,  para.  54,  n.  87  (finding  that  facsimile  transmissions  from  persons 
 or  entities  that  have  an  established  business  relationship  with  the  recipient  can  be  deemed  to  be  invited  or  permitted  by  the  recipient).  See  also  47  C.  F.  R.  64.1200(  f)(  4)  for  the  definition  of  an  established  business 


 relationship.  We  emphasize  that,  prior  to  the  effectuation  of  rules  contained  herein,  companies  that  transmitted  facsimile  advertisements  to  customers  with  whom  they  had  established  business  relationships  were  in  compliance 
 with  the  Commissions  existing  rules. 
113

 Federal  Communications  Commission  FCC  03-  153 
 114 
 the  facsimile  machine,  and  the  costs  associated  with  the  time  spent  receiving  a  facsimile  advertisement  during  which  the  machine  cannot  be  used  by  its  owner  to  send  or  receive  other 
 facsimile  transmissions.  700 
 190.  The  legislative  history  indicates  that  one  of  Congress  primary  concerns  was  to  protect  the  public  from  bearing  the  costs  of  unwanted  advertising.  Certain  practices  were  treated 


 differently  because  they  impose  costs  on  consumers.  For  example,  under  the  TCPA,  calls  to  wireless  phones  and  numbers  for  which  the  called  party  is  charged  are  prohibited  in  the  absence 
 of  an  emergency  or  without  the  prior  express  consent  of  the  called  party.  701  Because  of  the  cost  shifting  involved  with  fax  advertising,  Congress  similarly  prohibited  unsolicited  faxes  without 
 the  prior  express  permission  of  the  recipient.  702  Unlike  the  do-  not-  call  list  for  telemarketing  calls,  Congress  provided  no  mechanism  for  opting  out  of  unwanted  facsimile  advertisements. 
 Such  an  opt-  out  list  would  require  the  recipient  to  possibly  bear  the  cost  of  the  initial  facsimile  and  inappropriately  place  the  burden  on  the  recipient  to  contact  the  sender  and  request  inclusion 
 on  a  do-  not-  fax  list.  703 
 191.  Instead,  Congress  determined  that  companies  that  wish  to  fax  unsolicited  advertisements  to  customers  must  obtain  their  express  permission  to  do  so  before  transmitting 


 any  faxes  to  them.  704  Advertisers  may  obtain  consent  for  their  faxes  through  such  means  as  direct  mail,  websites,  and  interaction  with  customers  in  their  stores.  Under  the  new  rules,  the 
 permission  to  send  fax  advertisements  must  be  provided  in  writing,  include  the  recipients  signature  and  facsimile  number,  and  cannot  be  in  the  form  of  a  negative  option.  705  For 
 example,  a  company  that  requests  a  fax  number  on  an  application  form  could  include  a  clear  statement  indicating  that,  by  providing  such  fax  number,  the  individual  or  business  agrees  to 
 receive  facsimile  advertisements  from  that  company.  Such  statement,  if  accompanied  by  the  recipients  signature,  will  constitute  the  necessary  prior  express  permission  to  send  facsimile 
 advertisements  to  that  individual  or  business.  We  believe  that  even  small  businesses  may  easily  obtain  permission  from  existing  customers  who  agree  to  receive  faxed  advertising,  when 
 customers  patronize  their  stores  or  provide  their  contact  information.  The  Commission  believes  that  given  the  cost  shifting  and  interference  caused  by  unsolicited  faxes,  the  interest  in  protecting 


 700  NCL  Comments  at  6;  Michael  J.  Blitch  Comments  at  7;  Autoflex  Comments  at  1-  2. 
 701  See  47  U.  S.  C.    227(  b)(  1). 
 702  47  U.  S.  C.    227(  b)(  1)(  C)  and  (a)(  4). 
 703  See,  e.  g.,  Blocklist.  com  Comments  (operates  a  national  do-  not-  fax  list);  Davide  Di  Labio  Comments  (should  be 
 a  national  fax  list  for  those  opposed  to  faxes);  William  B.  Hayes  Comments  (no-  fax  lists  are  an  alternative  solution);  Paul  Aratow  Comments  (do-  not-  fax  lists  do  not  work);  W.  Allen  Wilkins  Comments  (after  responding 


 to  a  remove  your  fax  number,  receives  more  faxes). 
 704  See  47  U.  S.  C.    227(  b)(  1)(  C)  and  (a)(  4). 


 705  A  facsimile  advertisement  containing  a  telephone  number  and  an  instruction  to  call  if  the  recipient  no  longer 
 wishes  to  receive  such  faxes,  would  constitute  a  negative  option.  This  option  (in  which  the  sender  presumes  consent  unless  advised  otherwise)  would  impose  costs  on  facsimile  recipients  unless  or  until  the  recipient  were 


 able  to  ask  that  such  transmissions  be  stopped. 
114

 Federal  Communications  Commission  FCC  03-  153 
 115 
 those  who  would  otherwise  be  forced  to  bear  the  burdens  of  unwanted  faxes  outweighs  the  interests  of  companies  that  wish  to  advertise  via  fax. 
 192.  Membership  in  a  Trade  Association.  In  its  1995  Reconsideration  Order,  the  Commission  determined  that  mere  distribution  or  publication  of  a  telephone  facsimile  number  is 
 not  the  equivalent  of  prior  express  permission  to  receive  faxed  advertisements.  706  The  Commission  also  found  that  given  the  variety  of  circumstances  in  which  such  numbers  may  be 
 distributed  (business  cards,  advertisements,  directory  listings,  trade  journals,  or  by  membership  in  an  association),  it  was  appropriate  to  treat  the  issue  of  consent  in  any  complaint  regarding 
 unsolicited  facsimile  advertisements  on  a  case-  by-  case  basis.  707  In  the  2002  Notice,  we  sought  comment  specifically  on  the  issue  of  membership  in  a  trade  association  or  similar  group  and 
 asked  whether  publication  of  ones  fax  number  in  an  organizations  directory  constitutes  an  invitation  or  permission  to  receive  an  unsolicited  fax.  708  The  American  Business  Media  argued 
 that  those  willing  to  make  fax  numbers  available  in  directories  released  to  the  public  do  so  with  an  expectation  that  such  fax  numbers  will  be  used  for  advertising.  709  Consumer  advocates, 
 however,  contend  that  publicly  listing  a  fax  number  is  not  a  broad  invitation  to  send  commercial  faxes.  710  TOPUC  asserted  that  businesses  often  publish  their  fax  numbers  for  the  convenience  of 
 their  customers,  clients  and  other  trade  association  members,  not  for  the  benefit  of  telemarketers.  711 


 193.  The  Commission  agrees  that  fax  numbers  are  published  and  distributed  for  a  variety  of  reasons,  all  of  which  are  usually  connected  to  the  fax  machine  owners  business  or 
 other  personal  and  private  interests.  The  record  shows  that  they  are  not  distributed  for  other  companies  advertising  purposes.  Thus,  a  company  wishing  to  fax  ads  to  consumers  whose 
 numbers  are  listed  in  a  trade  publication  or  directory  must  first  obtain  the  express  permission  of  those  consumers.  Express  permission  to  receive  a  faxed  ad  requires  that  the  consumer 
 understand  that  by  providing  a  fax  number,  he  or  she  is  agreeing  to  receive  faxed  advertisements.  We  believe  the  burden  on  companies  to  obtain  express  permission  is  warranted  when  balanced 
 against  the  need  to  protect  consumers  and  businesses  from  bearing  the  advertising  costs  of  those 


 706  1995  Reconsideration  Order,  10  FCC  Rcd  at  12408-  09,  para.  37. 
 707  1995  Reconsideration  Order,  10  FCC  Rcd  at  12408-  09,  para.  37. 
 708  2002  Notice,  17  FCC  Rcd  at  17482-  83,  para.  38. 
 709  ABM  Comments  at  8;  see  also  Brunswick  Comments  at  8-  10;  DIRECTV  Comments  at  11  (generally, 
 publication  of  a  fax  number  should  constitute  permission,  but  consumers  should  be  able  to  control  the  circumstances  under  which  they  will  receive  faxes.  For  example,  a  trade  association  could  note  in  its  directory 


 that  faxes  are  not  to  be  used  for  advertising  purposes). 
 710  See,  e.  g.,  NCL  Comments  at  6;  NAAG  Comments  at  31;  TOPUC  Comments  at  6;  John  Holcomb  Comments  at 
 4. 
 711  TOPUC  Comments  at  6;  see  also  Mathemaesthetics  Reply  Comments  at  7  (operators  of  a  trade  show  ignored 
 request  not  to  use  fax  number  for  advertising  and  began  transmitting  multi-  page  fax  ads  for  services  my  business  has  no  interest  in).  But  see  NADA  Comments  at  3  (in  deciding  to  become  a  member  of  a  trade  association,  the 


 member  voluntarily  seeks  the  benefit  of  the  associations  services). 
115

 Federal  Communications  Commission  FCC  03-  153 
 116 
 companies.  Finally,  the  Commission  affirms  that  facsimile  requests  for  permission  to  transmit  faxed  ads,  including  toll-  free  opt-  out  numbers,  impose  unacceptable  costs  on  the  recipients.  This 
 kind  of  negative  option  is  contrary  to  the  statutory  requirement  for  prior  express  permission  or  invitation.  712 


 2.  Fax  Broadcasters 
 194.  The  Commission  explained  in  the  2002  Notice  that  some  fax  broadcasters,  who  transmit  other  entities  advertisements  to  a  large  number  of  telephone  facsimile  machines  for  a 


 fee,  maintain  lists  of  facsimile  numbers  that  they  use  to  direct  their  clients  advertisements.  713  We  noted  that  this  practice,  among  others,  indicates  a  fax  broadcasters  close  involvement  in 
 sending  unlawful  fax  advertisements  and  may  subject  such  entities  to  enforcement  action  under  the  TCPA  and  our  existing  rules.  We  then  sought  comment  on  whether  the  Commission  should 
 address  specifically  in  the  rules  the  activities  of  fax  broadcasters.  714  Companies  and  organizations  whose  members  hire  fax  broadcasters  to  transmit  their  messages  argue  that  the  fax 
 broadcaster  should  be  liable  for  violations  of  the  TCPAs  faxing  prohibition.  715  AIADA  maintains  this  should  be  the  case,  even  if  the  fax  broadcaster  uses  the  list  of  fax  numbers 
 provided  by  the  company  doing  the  advertising.  716  Nextel  argues  that  liability  ought  to  lie  with  the  party  controlling  the  destination  of  the  fax;  that  fax  broadcasters  who  actively  compile  and 
 market  databases  of  fax  numbers  are  the  major  perpetrators  of  TCPA  fax  violations.  717  Nextel  specifically  urges  the  Commission  to  find  that  companies  whose  products  are  advertised  by 
 independent  retailers  should  not  be  liable  for  TCPA  violations  when  they  have  no  knowledge  of  such  activities.  718  Fax  broadcasters  disagree  that  they  should  be  liable  for  unlawful  faxes, 
 maintaining  that  many  of  them  do  not  exercise  any  editorial  control  or  discretion  over  the  content  of  the  messages,  719  and  do  not  provide  the  list  of  fax  numbers  to  which  the  ads  are 


 712  1995  Reconsideration  Order,  10  FCC  Rcd  at  12408-  09,  para.  37;  see  also  Hunton  &  Williams  Comments  at  7 
 (recommends  at  opt-  out  mechanism  for  unsolicited  faxes). 
 713  2002  Notice,  17  FCC  Rcd  at  17483-  84,  para.  40. 


 714  2002  Notice  ,  17  FCC  Rcd  at  17483-  84,  para.  40. 
 715  AIADA  Comments  at  2;  Nextel  Comments  at  40. 
 716  AIADA  Comments  at  2. 
 717  Nextel  Comments  at  38;  see  also  NAAG  Comments  at  32  (stating  that  fax  broadcasters  that  maintain  their  own 
 databases  of  fax  numbers  are  the  subject  of  the  vast  majority  of  consumer  complaints  and  state  enforcement  actions,  and  that  fax  broadcasters  who  determine  the  content  of  the  advertisement  or  its  destination  should  be  held 


 liable  for  unsolicited  faxes). 
 718  Nextel  Comments  at  25,  38-  40;  see  also  DIRECTV  Comments  at  3,  9  (asking  whether  DIRECTV  or  its 
 independent  contractors  have  the  established  business  relationship  with  a  consumer). 
 719  Xpedite  Comments  at  5-  7;  Globecomm  Comments  at  4-  5;  ADVAL  Reply  Comments  at  3  (fax  broadcasters 
 never  see  the  list  of  recipients  or  the  faxed  document,  which  is  often  uploaded  directly  through  the  Internet);  Xpedite  Reply  Comments  at  3,  8. 
116

 Federal  Communications  Commission  FCC  03-  153 
 117 
 transmitted.  720  Many  industry  as  well  as  consumer  commenters  agree  that  only  those  fax  broadcasters  who  are  closely  involved  in  the  transmission  of  the  fax  should  be  subject  to 
 liability.  721  Reed  asserts  that  liability  should  rest  with  the  entity  on  whose  behalf  a  fax  is  sent;  that  fax  broadcasters  are  not  in  a  position  to  know  firsthand  whether,  for  example,  an  established 
 business  relationship  exists  between  the  company  and  consumer.  722 
 195.  The  Commissions  rulings  clearly  indicate  that  a  fax  broadcasters  exemption  from  liability  is  based  on  the  type  of  activities  it  undertakes,  and  only  exists  [  i]  n  the  absence  of 


 a  high  degree  of  involvement  or  actual  notice  of  an  illegal  use  and  failure  to  take  steps  to  prevent  such  transmissions.    723  The  Commission  believes  that,  based  on  the  record  and  our  own 
 enforcement  experience,  addressing  the  activities  of  fax  broadcasters  will  better  inform  both  consumers  and  businesses  about  the  prohibition  on  unsolicited  fax  advertising.  The  Commission 
 has  determined  to  amend  the  rules  to  explicitly  state  that  a  fax  broadcaster  will  be  liable  for  an  unsolicited  fax  if  there  is  a  high  degree  of  involvement  or  actual  notice  on  the  part  of  the 
 broadcaster.  The  new  rules  provide  that  if  the  fax  broadcaster  supplies  the  fax  numbers  used  to  transmit  the  advertisement,  the  fax  broadcaster  will  be  liable  for  any  unsolicited  advertisement 
 faxed  to  consumers  and  businesses  without  their  prior  express  invitation  or  permission.  We  agree,  however,  that  if  the  company  whose  products  are  advertised  has  supplied  the  list  of  fax 
 numbers,  that  company  is  in  the  best  position  to  ensure  that  recipients  have  consented  to  receive  the  faxes  and  should  be  liable  for  violations  of  the  prohibition.  Therefore,  the  fax  broadcaster 
 will  not  be  responsible  for  the  ads,  in  the  absence  of  any  other  close  involvement,  such  as  determining  the  content  of  the  faxed  message.  724  In  such  circumstances  where  both  the  fax 
 broadcaster  and  advertiser  demonstrate  a  high  degree  of  involvement,  they  may  be  held  jointly  and  severally  liable  for  violations  of  the  unsolicited  facsimile  provisions.  In  adopting  this  rule, 
 the  Commission  focuses  on  the  nature  of  an  entitys  activity  rather  than  on  any  label  that  the  entity  may  claim.  We  believe  the  rule  will  better  inform  the  business  community  about  the 
 prohibition  on  unsolicited  fax  advertising  and  the  liability  that  attaches  to  such  faxing.  And,  it  will  better  serve  consumers  who  are  often  confused  about  which  party  is  responsible  for 
 unlawful  fax  advertising.  For  the  same  reasons,  the  new  rules  define  facsimile  broadcaster  to  mean  a  person  or  entity  that  transmits  messages  to  telephone  facsimile  machines  on  behalf  of 
 another  person  or  entity  for  a  fee.  725 
 196.  Some  commenters  ask  the  Commission  to  clarify  the  extent  of  common  carriers 
 720  ADVAL  Reply  Comments  at  3;  Xpedite  Reply  Comments  at  3. 
 721  Xpedite  Comments  at  3-  4;  NAAG  Comments  at  32-  33;  NCL  Comments  at  6;  ADVAL  Comments  at  3  (  Fax 
 carriers  should  not  be  penalized  for  traffic  sent  by  third  parties.). 
 722  Reed  Comments  at  6. 


 723  1992  TCPA  Order,  7  FCC  Rcd  at  8780,  para.  54  (quoting  Use  of  Common  Carriers,  2  FCC  Rcd  2819,  2820 
 (1987)). 
 724  A  high  degree  of  involvement  might  be  demonstrated  by  a  fax  broadcasters  role  in  reviewing  and  assessing 
 the  content  of  a  facsimile  message. 
 725  See  47  C.  F.  R.    64.1200(  f)(  4). 
117

 Federal  Communications  Commission  FCC  03-  153 
 118 
 liability  for  the  transmission  of  unsolicited  faxes.  726  Cox  specifically  urges  the  Commission  to  distinguish  the  obligations  of  fax  broadcasters  from  traditional  common  carriers.  727  As  noted 
 above,  the  Commission  has  stated  that  [  i]  n  the  absence  of  a  high  degree  of  involvement  or  actual  notice  of  an  illegal  use  and  failure  to  take  steps  to  prevent  such  transmissions,    common 
 carriers  will  not  be  held  liable  for  the  transmission  of  a  prohibited  facsimile  message.  728  We  reiterate  here  that  if  a  common  carrier  is  merely  providing  the  network  over  which  a  subscriber 
 (a  fax  broadcaster  or  other  individual,  business,  or  entity)  sends  an  unsolicited  facsimile  message,  that  common  carrier  will  not  be  liable  for  the  facsimile. 


 197.  Nextel  urges  the  Commission  to  clarify  that  section  217  of  the  Communications  Act  does  not  impose  a  higher  level  of  liability  on  common  carriers  than  on  other  entities  for 
 violations  of  the  TCPA.  729  Section  217  provides  that    [i]  n  construing  and  enforcing  the  provisions  of  this  Act,  the  act,  omission,  or  failure  of  any  officer,  agent,  or  other  person  acting 
 for  or  employed  by  any  common  carrier  or  user,  acting  within  the  scope  of  his  employment,  shall  in  every  case  be  also  deemed  to  be  the  act,  omission,  or  failure  of  such  carrier  or  user  as  well  as 
 that  of  the  person.  730  The  Commission  declines  to  address  the  scope  of  section  217  in  this  rulemaking,  which  was  not  raised  in  the  2002  Notice  or  in  subsequent  notices  in  this  proceeding. 


 3.  Fax  Servers 
 198.  The  TCPA  makes  it  unlawful  for  any  person  to  use  any  telephone  facsimile  machine,  computer,  or  other  device  to  send  an  unsolicited  advertisement  to  a  telephone  facsimile 


 machine.  731  The  TCPA  defines  the  term  telephone  facsimile  machine  to  mean  equipment  which  has  the  capacity  (A)  to  transcribe  text  or  images,  or  both,  from  paper  into  an  electronic 
 signal  and  to  transmit  that  signal  over  a  regular  telephone  line,  or  (B)  to  transcribe  text  or  images  (or  both)  from  an  electronic  signal  received  over  a  regular  telephone  line  onto  paper.  732  The 
 Commission  sought  comment  on  any  developing  technologies,  such  as  computerized  fax  servers,  that  might  warrant  revisiting  these  rules.  733 


 199.  Commenters  who  addressed  this  issue  were  divided  on  whether  fax  servers  should  be  subject  to  the  unsolicited  facsimile  provisions.  Some  industry  representatives  urged  the 
 Commission  to  clarify  that  the  TCPA  does  not  prohibit  the  transmission  of  unsolicited  fax 
 726  Cox  Comments  at  12-  19. 
 727  Cox  Comments  at  13. 
 728  1992  TCPA  Order,  7  FCC  Rcd  at  8780,  para.  54  (quoting  Use  of  Common  Carriers,  2  FCC  Rcd  2819,  2820 
 (1987)). 
 729  Nextel  Comments  at  40-  41. 


 730  47  U.  S.  C.    217. 
 731  47  U.  S.  C.    227(  b)(  1)(  C). 
 732  47  U.  S.  C.    227(  a)(  2);  this  definition  was  incorporated  in    64.1200(  f)(  2)  of  the  Commissions  rules. 
 733  2002  Notice,  17  FCC  Rcd  at  17482,  para.  37. 
118

 Federal  Communications  Commission  FCC  03-  153 
 119 
 advertisements  to  fax  servers  and  personal  computers  because  these  transmissions  are  not  sent  to  a  telephone  facsimile  machine,  as  defined  in  the  statute.  734  Nextel  maintains  that  such  faxes  do 
 not  implicate  the  harms  Congress  sought  to  redress  in  the  TCPA,  as  they  are  not  reduced  to  paper  and  can  be  deleted  from  ones  inbox  without  being  opened  or  examined.  735  Other  commenters 
 disagree,  noting  that  there  are  other  costs  associated  with  faxes  sent  to  computers  and  fax  servers.  736  They  note  that  the  TPCA  only  requires  that  the  equipment  have  the  capacity  to 
 transcribe  text  or  messages  onto  paper,  737  and  that  computer  fax  servers  and  personal  computers  have  that  capacity. 


 200.  We  conclude  that  faxes  sent  to  personal  computers  equipped  with,  or  attached  to,  modems  and  to  computerized  fax  servers  are  subject  to  the  TCPAs  prohibition  on  unsolicited 
 faxes.  However,  we  clarify  that  the  prohibition  does  not  extend  to  facsimile  messages  sent  as  email  over  the  Internet.  The  record  confirms  that  a  conventional  stand-  alone  telephone  facsimile 
 machine  is  just  one  device  used  for  this  purpose;  that  developing  technologies  permit  one  to  send  and  receive  facsimile  messages  in  a  myriad  of  ways.  Today,  a  modem  attached  to  a  personal 
 computer  allows  one  to  transmit  and  receive  electronic  documents  as  faxes.  Fax  servers  enable  multiple  desktops  to  send  and  receive  faxes  from  the  same  or  shared  telephony  lines.  738 


 201.  The  TCPAs  definition  of  telephone  facsimile  machine  broadly  applies  to  any  equipment  that  has  the  capacity  to  send  or  receive  text  or  images.  The  purpose  of  the 
 requirement  that  a  telephone  facsimile  machine  have  the  capacity  to  transcribe  text  or  images  is  to  ensure  that  the  prohibition  on  unsolicited  faxing  not  be  circumvented.  Congress 
 could  not  have  intended  to  allow  easy  circumvention  of  its  prohibition  when  faxes  are  (intentionally  or  not)  transmitted  to  personal  computers  and  fax  servers,  rather  than  to  traditional 
 stand-  alone  facsimile  machines.  As  the  House  Report  accompanying  the  TCPA  explained,  facsimile  machines  are  designed  to  accept,  process  and  print  all  messages  which  arrive  over 
 their  dedicated  lines.  The  fax  advertiser  takes  advantage  of  this  basic  design  by  sending  advertisements  to  available  fax  numbers,  knowing  that  it  will  be  received  and  printed  by  the 
 recipients  machine.  739  However,  Congress  also  took  account  of  the  interference, 
 734  See  Nextel  Comments  at  31-  32. 


 735  Nextel  Reply  Comments  at  4-  5. 
 736  Michael  C.  Worsham  Comments  at  20;  James  Suggs  Comments  at  1.  Commenters  also  note  that  some 
 commercial  facsimile  services  transmit  faxes  to  the  recipients  as  email  attachments.  We  emphasize  that  any  rules  the  Commission  adopts  with  respect  to  unsolicited  facsimile  advertisements  would  not  extend  to  facsimile 


 messages  transmitted  as  email  over  the  Internet.  See  definition  of  telephone  facsimile  machine  at  47  U.  S.  C.    227(  a)(  2). 


 737  Autoflex  Comments  at  2;  J.  Greg  Coontz  Reply  Comments  at  11-  15,  16-  17. 
 738  See  Kauffman  Comments  at  3.  Although  fax  boards  alone  do  not  have  the  capability  to  transcribe  text  onto  or 
 from  paper,  the  Commission  nevertheless  determined  that  fax  modem  boards,  which  enable  personal  computers  to  transmit  messages  to  or  receive  messages  from  conventional  facsimile  machines  or  other  computer  fax  boards,  are 


 the  functional  equivalent  of  telephone  facsimile  machines.  See  1995  Reconsideration  Order,  10  FCC  Rcd  at  12404-  06,  paras.  28-  30. 


 739  H.  R.  REP.  NO.  102-  317  at  10  (1991). 
119

 Federal  Communications  Commission  FCC  03-  153 
 120 
 interruptions,  and  expense  resulting  from  junk  faxes,  emphasizing  in  the  same  Report  that  [  i]  n  addition  to  the  costs  associated  with  the  fax  advertisements,  when  a  facsimile  machine  is 
 receiving  a  fax,  it  may  require  several  minutes  or  more  to  process  and  print  the  advertisement.  During  that  time,  the  fax  machine  is  unable  to  process  actual  business  communications.  740 


 202.  Facsimile  messages  sent  to  a  computer  or  fax  server  may  shift  the  advertising  costs  of  paper  and  toner  to  the  recipient,  if  they  are  printed.  They  may  also  tie  up  lines  and 
 printers  so  that  the  recipients  requested  faxes  are  not  timely  received.  741  Such  faxes  may  increase  labor  costs  for  businesses,  whose  employees  must  monitor  faxes  to  determine  which 
 ones  are  junk  faxes  and  which  are  related  to  their  companys  business.  Finally,  because  a  sender  of  a  facsimile  message  has  no  way  to  determine  whether  it  is  being  sent  to  a  number  associated 
 with  a  stand-  alone  fax  machine  or  to  one  associated  with  a  personal  computer  or  fax  server,  it  would  make  little  sense  to  apply  different  rules  based  on  the  device  that  ultimately  received  it. 


 4.  Identification  Requirements 
 203.  The  TCPA  and  Commission  rules  require  that  any  message  sent  via  a  telephone  facsimile  machine  contain  the  date  and  time  it  is  sent  and  an  identification  of  the  business,  other 


 entity,  or  individual  sending  the  message  and  the  telephone  number  of  the  sending  machine  or  of  such  business,  other  entity,  or  individual.  742  In  the  2002  Notice,  the  Commission  asked  whether 
 these  rules  have  been  effective  at  protecting  consumers  rights  to  enforce  the  TCPA.  743  The  Commission  determined  in  its  1997  Reconsideration  Order  that  a  facsimile  broadcast  service 
 must  ensure  that  the  identifying  information  of  the  entity  on  whose  behalf  the  provider  sent  messages  appear  on  facsimile  messages.  In  its  discussion,  the  Commission  clarified  that  the 
 sender  of  a  facsimile  message  is  the  creator  of  the  content  of  the  message,  finding  that  Section  227(  d)(  1)  of  the  TCPA  mandates  that  a  facsimile  include  the  identification  of  the  business,  other 
 entity,  or  individual  creating  or  originating  a  facsimile  message,  and  not  the  entity  that  transmits  the  message.  744  The  Commission  believes  that  if  a  fax  broadcaster  is  responsible  for  the  content 
 of  the  message  or  for  determining  the  destination  of  the  message  (i.  e.,  supplying  the  list  of  facsimile  numbers  to  which  the  faxes  are  sent),  it  should  be  identified  on  the  facsimile,  along 
 with  the  entity  whose  products  are  advertised.  745  Therefore,  we  amend  the  rules  to  require  any 


 740  H.  R.  REP.  NO.  102-  317  at  25  (1991). 
 741  See  Covington  &  Burling  v.  International  Marketing  &  Research,  Inc.  et  al.,  No.  01-  0004360  (D.  C.  Sup.  Ct. 
 (April  16,  2003)  (finding  a  fax  broadcaster  liable  under  the  TCPA  for  transmitting  unsolicited  fax  advertisements  to  a  law  firms  fax  server). 


 742  47  U.  S.  C.    227(  d)(  1)(  B);  47  C.  F.  R.    68.318(  d). 
 743  2002  Notice,  17  FCC  Rcd  at  17483-  84,  paras.  37  and  40. 
 744  1997  Reconsideration  Order,  12  FCC  Rcd  at  4612-  13,  para.  6. 
 745  See  NAAG  Comments  at  32-  33  (stating  that  only  requiring  the  advertisers  identify  has  been  a  hindrance  in 
 enforcing  the  TCPA.  It  has  been  the  states  experience  that  fax  broadcasters,  who  maintain  their  own  databases  and  send  others  advertisements  to  these  fax  numbers,  frequently  omit  their  identifying  information  as  the  sender 


 in  order  to  avoid  detection  and  enforcement  action.). 
120

 Federal  Communications  Commission  FCC  03-  153 
 121 
 fax  broadcaster  that  demonstrates  a  high  degree  of  involvement  in  the  transmission  of  such  facsimile  message  to  be  identified  on  the  facsimile,  along  with  the  identification  of  the  sender.  746 
 This  will  permit  consumers  to  hold  fax  broadcasters  accountable  for  unlawful  fax  advertisements  when  there  is  a  high  degree  of  involvement  on  the  part  of  the  fax  broadcaster.  747 
 Commenters  suggested  the  Commission  clarify  what  constitutes  an  adequate  identification  header.  748  Consistent  with  our  amended  identification  rules  for  telemarketing  calls,  senders  of 
 fax  advertisements  will  be  required  under  the  new  rules  to  use  the  name  under  which  they  are  officially  registered  to  conduct  business.  749  Use  of  a  d/  b/  a  (  doing  business  as)  or  other  more 
 widely  recognized  name  is  permissible;  however,  the  official  identification  of  the  business,  as  filed  with  state  corporate  registration  offices  or  comparable  regulatory  entities,  must  be  included, 
 at  a  minimum. 
 XIV.  PRIVATE  RIGHT  OF  ACTION 
 A.  Background 
 204.  The  TCPA  is  a  unique  statute  in  that  it  provides  consumers  with  two  private  rights  of  action  for  violations  of  the  TCPA  rules.  One  provision  permits  a  consumer  to  file  suit 


 immediately  in  state  court  if  a  caller  violates  the  TCPAs  prohibitions  on  the  use  of  automatic  dialing  systems,  artificial  or  prerecorded  voice  messages,  and  unsolicited  facsimile 
 advertisements.  750  A  separate  private  right  of  action  permits  a  consumer  to  file  suit  in  state  court  if  he  or  she  has  received  more  than  one  telephone  call  within  any  12-  month  period  by  or  on 
 behalf  of  the  same  company  in  violation  of  the  guidelines  for  making  telephone  solicitations.  751  Based  on  inquiries  received  about  the  private  right  of  action,  the  Commission  asked  whether  we 
 should  clarify  whether  a  consumer  may  file  suit  after  receiving  one  call  from  a  telemarketer  who,  for  example,  fails  to  properly  identify  himself  or  makes  a  call  outside  the  time  of  day 
 restrictions.  752 
 205.  Industry  commenters  argue  that  the  statutory  language  is  clear;  that  only  a  person  who  has  received  more  than  one  telephone  call  that  violates  the  telephone  solicitation  rules 


 746  See  amended  rule  at  47  C.  F.  R.    68.318(  d). 
 747  See  supra  discussion,  paras.  194-  195. 
 748  Michael  C.  Worsham  Comments  at  11-  12;  NCL  Comments  at  6;  Michael  J.  Blitch  Comments  at  7  (both  seller 
 and  fax  broadcaster  should  be  identified);  NAAG  at  33  (should  require  identifying  information  of  fax  broadcaster).  But  see  Xpedite  Reply  Comments  at  8  (requiring  a  fax  broadcasters  identifying  information  could 


 confuse  consumers  as  to  who  created  the  message.  Uninvolved  fax  broadcasters  should  not  be  required  to  identify  themselves  on  faxes.). 


 749  See  supra  discussion  on  identification  requirements  for  telemarketers,  para.  144. 
 750  47  U.  S.  C.    227(  b)(  3). 
 751  47  U.  S.  C.    227(  c)(  5). 
 752  2002  Notice,  17  FCC  Rcd  at  17486-  87,  para.  47. 
121

 Federal  Communications  Commission  FCC  03-  153 
 122 
 within  any  12-  month  period  may  file  suit  under  the  TCPAs  private  right  of  action.  753  Consumers  and  consumer  advocates  were  split  on  the  issue.  Some  maintained  that  a  consumer 
 should  be  permitted  to  pursue  a  private  right  of  action  for  a  telemarketers  first  offense;  754  others  acknowledged  that  the  statute  does  not  permit  a  cause  of  action  for  the  first  time  a  telemarketer 
 violates  the  telephone  solicitation  rules.  755  Several  industry  commenters  point  out  that  they  have  been  named  as  defendants  in  class  action  lawsuits  under  the  TCPA  in  state  courts.  756  They  urge 
 the  Commission  to  determine  that  the  TCPAs  private  right  of  action  does  not  contemplate  or  permit  class  action  lawsuits.  757  Some  consumer  commenters  and  plaintiffs  attorneys  who  have 
 filed  class  action  suits  argue  that  foreclosing  class  actions  would  severely  handicap  the  effectiveness  of  the  TCPA  and  consumers  ability  to  enforce  its  provisions.  They  also  contend 
 that  the  FCC  is  not  authorized  to  interfere  with  state  courts  certification  of  class  actions.  758 
 B.  Discussion 
 206.  The  Commission  declines  to  make  any  determination  about  the  specific  contours  of  the  TCPAs  private  right  of  action.  Congress  provided  consumers  with  a  private  right  of 


 action,  if  otherwise  permitted  by  the  laws  or  rules  of  court  of  a  State.  759  This  language  suggests  that  Congress  contemplated  that  such  legal  action  was  a  matter  for  consumers  to  pursue 
 in  appropriate  state  courts,  subject  to  those  courts  rules.  The  Commission  believes  it  is  for  Congress,  not  the  Commission,  to  either  clarify  or  limit  this  right  of  action. 


 XV.  INFORMAL  COMPLAINT  RULES 
 207.  In  the  2002  Notice,  the  Commission  noted  that  it  had  released  another  Notice  of  Proposed  Rulemaking  in  February  of  2002,  seeking  comment  on  whether  to  extend  the  informal 


 complaint  rules  to  entities  other  than  common  carriers.  760  We  sought  comment  in  this  proceeding 


 753  Mastercard  Comments  at  7;  BMO  Financial  Comments  at  4;  Bank  of  America  Comments  at  6;  DialAmerica 
 Comments  at  14;  AT&  T  Wireless  Reply  Comments  at  27-  28. 
 754  Martin  C.  Kaplan  Comments  at  2  (acknowledging  that  [  u]  p  to  one  call  per  year  is  permitted  .  .  .  should  be 
 amended  to  total  prohibition);  April  Jordon  Comments  at  2;  Wayne  G.  Strang  Reply  Comments  at  16;  NCL  Comments  at  7. 


 755  NYSCPB  Comments  at  19;  Michael  C.  Worsham  Comments  at  15  (Commission  should  clarify  that  once 
 threshold  of  two  calls  received  within  one  year  is  met  all  violations  in  any  calls  are  actionable). 
 756  See  DIRECTV  Comments  at  3-  4;  Nextel  Comments  at  39. 


 757  See,  e.  g.,  AIA  Comments  at  2;  AIADA  Comments  at  2;  Kauffman  Comments  at  8;  DIRECTV  Reply 
 Comments  at  7;  ABM  Comments  at  2. 
 758  See  Hershovitz  Reply  Comments  at  1,  8-  9;  Wayne  G.  Strang  Reply  Comments  at  4;  see  also  City  of  New 
 Orleans  Comments  at  11;  Joe  Shields  Reply  Comments  at  9. 
 759  47  U.  S.  C.    227(  c)(  5). 


 760  2002  Notice,  17  FCC  Rcd  at  17486-  87,  para.  47.  See  generally  Establishment  of  Rules  Governing  Procedures 
 to  Be  Followed  When  Informal  Complaints  Are  Filed  by  Consumers  Against  Entities  Regulated  by  the  Commission;  Amendment  of  Subpart  E  of  Chapter  1  of  the  Commissions  Rules  Governing  Procedures  to  Be 


 (continued.) 
122

 Federal  Communications  Commission  FCC  03-  153 
 123 
 on  whether  the  Commission  should  amend  these  informal  complaint  rules  to  apply  to  telemarketers.  We  will  review  this  issue  as  part  of  the  Informal  Complaints  proceeding.  All 
 comments  filed  in  this  proceeding  that  address  the  applicability  of  the  informal  complaint  rules  to  telemarketers  will  be  incorporated  into  CI  Docket  No.  02-  32. 


 XVI.  TIME  OF  DAY  RESTRICTIONS 
 208.  Commission  rules  restrict  telephone  solicitations  between  the  hours  of  8:  00  a.  m.  and  9:  00  p.  m.  local  time  at  the  called  partys  location.  761  As  part  of  our  review  of  the  TCPA 


 rules,  we  sought  comment  on  how  effective  these  time  restrictions  have  been  at  limiting  objectionable  solicitation  calls.  762  The  Commission  also  asked  whether  more  restrictive  calling 
 times  could  work  in  conjunction  with  a  national  registry  to  better  protect  consumers  from  telephone  solicitations  to  which  they  object. 


 209.  Industry  members  that  commented  on  the  calling  time  restrictions  unanimously  asserted  that  the  current  calling  times  should  be  retained.  763  Some  explained  that  any  restrictions 
 on  calls  made  during  the  early  evening  hours,  in  particular,  would  interfere  with  telemarketers  ability  to  reach  their  customers.  764  Consumers,  on  the  other  hand,  urged  the  Commission  to 
 adopt  tighter  restrictions  on  the  times  that  telemarketers  may  call  them.  Some  object  to  calls  at  the  end  of  the  day  and  during  the  dinner  hour;  765  others  prefer  that  telemarketers  not  be  able  to 
 begin  calling  until  later  in  the  morning.  766  Some  suggest  the  calling  times  should  parallel  local  noise  ordinances.  767  EPIC  advocated  allowing  consumers  to  specify  the  hours  they  wish  to 
 receive  calls.  768 
 210.  The  Commission  declines  to  revise  the  restrictions  on  calling  times.  Instead,  we 


 (Continued  from  previous  page)  Followed  When  Informal  Complaints  Are  Filed  Against  Common  Carriers;  2000  Biennial  Review,  Memorandum 
 Opinion  and  Order  and  Notice  of  Proposed  Rulemaking,  CI  Docket  No.  02-  32,  CC  Docket  Nos.  94-  93,  00-  175,  17  FCC  Rcd  3919  (2002). 


 761  47  C.  F.  R.    64.1200(  e)(  1). 
 762  2002  Notice,  17  FCC  Rcd  at  17481-  82,  para.  36. 
 763  See,  e.  g.,  ATA  Comments  at  105;  BMO  Financial  Comments  at  5;  HFS  Comments  at  9;  Technion  Comments 
 at  7;  AT&  T  Wireless  Comments  at  28. 
 764  Teleperformance  Comments  at  2;  ATA  Comments  at  106. 


 765  See,  e.  g.,  Melva  L.  Taylor  Comments  at  1;  Michael  C.  Worsham  Comments  at  11;  Robert  Jaglowski 
 Comments;  Linda  M.  Deakl  Comments;  Richard  M.  Bryant  Comments. 
 766  J.  Melville  Capps  Comments;  Mandy  Burkart  Comments;  Jeff  Bryson  Comments;  John  Shaw  Comments  at  7 
 (due  to  the  number  of  nighttime  workers,  time  of  day  restrictions  should  begin  at  9  am). 
 767  PUC  of  Ohio  Comments  at  22-  23;  James  Wood  Comments. 


 768  EPIC  Comments  at  13. 
123

 Federal  Communications  Commission  FCC  03-  153 
 124 
 retain  the  current  calling  times,  which  are  consistent  with  the  FTCs  rules.  769  We  believe  the  current  calling  times  strike  the  appropriate  balance  between  protecting  consumer  privacy  and  not 
 unduly  burdening  industry  in  their  efforts  to  conduct  legitimate  telemarketing.  We  also  believe  that  Commission  rules  that  diverge  from  the  FTCs  calling  restrictions  will  lead  to  confusion  for 
 consumers.  Moreover,  consumers  who  want  to  block  unwanted  calls  during  certain  times  will  now  have  the  option  of  placing  their  telephone  numbers  on  the  national  do-  not-  call  registry. 
 They  will  have  the  additional  option  of  giving  express  verifiable  authorization  to  only  those  companies  they  wish  to  hear  from.  The  Commission  declines  at  this  time  to  require  companies 
 to  adhere  to  consumers  calling  preferences,  including  acceptable  calling  times.  770  We  believe  that  the  costs  of  monitoring  calling  times  for  individual  consumers  could  be  substantial  for  many 
 companies,  particularly  small  businesses.  The  Commission  may  revisit  this  option  in  the  future. 
 XVII.  ENFORCEMENT  PRIORITIES 
 211.  TCPA  enforcement  has  been  a  Commission  priority  over  the  past  several  years,  771  and  we  intend  that  it  remain  so.  In  guiding  our  future  enforcement  plans,  we  recognize  that  the 


 FTCs  recent  rule  changes  expand  that  agencys  regulation  of  telemarketing  activities  and  require  coordination  to  ensure  consistent  and  non-  redundant  federal  enforcement  in  this  area. 
 Most  notably,  the  FTCs  adoption  of  a  nationwide  do-  not-  call  registry,  the  related  Do-  Not-  Call  Act,  and  finally  our  adoption  here  of  requirements  that  maximize  consistency  with  those  adopted 
 by  the  FTC  create  an  overlap  in  federal  regulations  governing  major  telemarketing  activities.  772  We  hereby  direct  Commission  staff  to  negotiate  with  FTC  staff  a  Memorandum  of 
 Understanding  between  the  respective  staffs  to  achieve  an  efficient  and  effective  enforcement  strategy  that  will  promote  compliance  with  federal  telemarketing  regulations,  consistent  with  the 
 guidelines  set  forth  below. 
 212.  The  FCCs  jurisdiction  over  telemarketing  is  significantly  broader  than  the  FTCs.  First,  as  noted  above,  the  FTC  does  not  have  authority  over  telemarketing  calls  made  by 


 in-  house  employees  of  common  carriers,  banks,  credit  unions,  savings  and  loans,  insurance  companies,  and  airlines.  In  addition,  the  FTCs  telemarketing  rules  pertain  only  to  interstate 
 transmissions.  In  contrast,  the  FCCs  telemarketing  rules  apply  without  exception  to  any  entity  engaged  in  any  of  the  telemarketing  activities  targeted  by  the  TCPA  and  the  Commissions 
 related  rules,  including  those  that  involve  purely  intrastate  activities.  773  Given  the  substantial  gaps  in  the  FTCs  authority  over  the  full  range  of  telemarketing  activities,  we  contemplate  that 
 our  enforcement  staff  will  focus  particularly  on  those  activities  and  entities  that  fall  outside  the 
 769  See  16  C.  F.  R.    310.4(  c);  see  also  FTC  Further  Comments  at  47-  50  (stating  that  the  FCC  should  retain  its 
 existing  calling  time  restrictions  and  maintain  the  consistency  that  both  agencies  have  sought  on  this  issue). 
 770  The  Commission  encourages  any  seller  or  telemarketer  to  comply  with  consumers  requests  not  to  be  called 
 during  certain  times  of  the  day. 
 771  See  <http://  www.  fcc.  gov/  eb/  News_  Releases/  DOC-  230145A1.  html>. 


 772  There  are  other  overlapping  regulations  such  as  provisions  governing  abandoned  calls,  transmission  of  caller 
 ID,  and  time-  of-  day  restrictions.  See  supra  paras.  146-  159,  173-  184,  208-  210. 
 773  47  U.  S.  C.    152(  b).  See  supra  paras.  9  and  16. 
124

 Federal  Communications  Commission  FCC  03-  153 
 125 
 FTCs  reach    airlines,  banks,  credit  unions,  savings  and  loans,  insurance  companies,  and  common  carriers,  as  well  as  intrastate  transmissions  by  any  entity. 
 213.  Nevertheless,  we  do  not  contemplate  Commission  enforcement  that  targets  only  those  activities,  entities,  or  transmissions  that  are  outside  the  FTCs  jurisdiction.  The  TCPA 
 creates  a  statutory  expectation  for  FCC  enforcement  in  the  telemarketing  area.  774  Moreover,  the  TCPAs  detailed  standards  pertaining  to  do-  not-  call  matters  evince  Congressional  intent  that  the 
 FCC  assume  a  prominent  role  in  federal  regulation  of  this  aspect  of  telemarketing,  a  mandate  that  is  not  altered  by  the  Do-  Not-  Call  Act.  Accordingly,  even  with  the  FTCs  new  do-  not-  call 
 regulations,  including  its  administration  of  a  national  do-  not-  call  registry,  we  emphasize  that  the  Commission  must  stand  ready  to  enforce  each  of  our  telemarketing  rules  in  appropriate  cases. 
 For  reasons  of  efficiency  and  fairness,  our  staff  will  work  closely  with  the  FTC  to  avoid  unnecessarily  duplicative  enforcement  actions. 


 214.  In  determining  enforcement  priorities  under  the  new  telemarketing  rules,  we  contemplate  that  the  Enforcement  Bureau  will  continue  its  policy  of  reviewing  FCC  and  FTC 
 consumer  complaint  data  and  conferring  with  appropriate  state  and  federal  agencies  to  detect  both  egregious  violations  and  patterns  of  violations,  and  will  act  accordingly.  775  The 
 Enforcement  Bureau  has  in  place  effective  procedures  to  review  aggregate  complaint  information  to  determine  the  general  areas  that  merit  enforcement  actions,  and  to  identify  both 
 particular  violators  and  the  individual  consumers  who  may  be  able  to  assist  the  staff  in  pursuing  enforcement  actions  against  such  violators.  776  Enforcement  action  could  include,  for  example, 
 forfeiture  proceedings  under  section  503(  b),  777  cease  and  desist  proceedings  under  section  312(  c),  injunctions  under  section  401,  and  revocation  of  common  carrier  section  214  operating 
 authority. 
 XVIII.  OTHER  ISSUES 
 A.  Access  to  TCPA  Inquiries  and  Complaints 
 215.  The  Commission  stated  that  the  2002  Notice  was  prompted,  in  part,  by  the  increasing  number  and  variety  of  inquiries  and  complaints  involving  our  rules  on  telemarketing 


 774  See  47  U.  S.  C.    227(  f)(  3),  (7). 
 775  Review  of  the  FTC  do-  not-  call  database  will  be  particularly  important  so  that  our  enforcement  staff  can  easily 
 determine  the  date  of  any  do-  not-  call  request  and  the  date  that  a  company  last  downloaded  information  from  the  database. 


 776  In  the  course  of  its  investigations,  the  Enforcement  Bureau  will  follow  up  with  individual  complainants  as 
 appropriate.  In  light  of  the  state  court  private  right  of  action  under  the  TCPA  and  the  fact  that  many  TCPA  complaints  are  not  against  common  carriers,  consistent  with  existing  practice,  the  staff  will  not  necessarily  contact 


 each  individual  TCPA  complainant.  Compare  47  U.  S.  C.    208. 
 777  Before  initiating  a  forfeiture  proceeding  against  most  entities  that  do  not  hold  an  FCC  authorization,  the 
 violator  must  have  received  a  Commission  citation  and  then  engaged  in  an  additional  violation.  47  U.  S.  C.    503(  b)(  5). 
125

 Federal  Communications  Commission  FCC  03-  153 
 126 
 and  unsolicited  fax  advertisements.  778  A  few  commenters  maintain  that  the  Commission  should  not  consider  final  rules  until  parties  have  had  an  opportunity  to  analyze  the  consumer  complaints 
 referenced  in  the  2002  Notice.  779  Other  commenters  contend  that  the  number  of  complaints  received  by  the  Commission  does  not  necessarily  demonstrate  a  problem  that  demands 
 government  intervention.  780  The  ATA  filed  a  Freedom  of  Information  Act  (FOIA)  request  with  the  Commission  on  October  16,  2002,  seeking  access  to  the  TCPA-  related  informal 
 complaints.  781  The  FOIA  generally  provides  that  any  person  has  a  right  to  obtain  access  to  federal  agency  records,  subject  to  enumerated  exemptions  from  disclosure.  782  The  FOIA 
 requirements  do  not  apply  to  records  that  contain  personnel  and  medical  files  and  similar  files  the  disclosure  of  which  would  constitute  a  clearly  unwarranted  invasion  of  personal  privacy.  783 
 Many  of  the  complaints  sought  by  the  ATA  contain  personal  private  information.  In  addition,  the  complaints  are  part  of  a  system  of  records  subject  to  the  Privacy  Act.  784  For  these  reasons, 
 the  Commission  agreed  to  release  the  complaints  on  a  rolling  basis  only  after  personal  information  was  redacted.  785  In  response  to  ATAs  FOIA  request,  the  Commission  has  thus  far 


 778  See  2002  Notice,  17  FCC  Rcd  at  17466,  para.  8. 
 779  See,  e.  g.,  ATA  Comments  at  41-  43  (stating  that  [  a]  s  a  general  matter,  access  to  the  [complaints]  is  necessary 
 to  ensure  that  interested  parties  have  a  meaningful  opportunity  to  participate  .  .  .  and  that  the  Court  has  an  adequate  record  from  which  to  determine  whether  the  agency  properly  performed  its  functions.  );  MBNA 


 Comments  at  10  (requesting  an  opportunity  to  review  the  complaints  to  determine  the  nature  of  the  specific  practices  complained  of,  and  the  extent  to  which  such  practices  reasonably  require  new  TCPA  rules  .  .  .). 


 780  See,  e.  g.,  ABM  Comments  at  7;  SBC  Comments  at  7-  8,  17;  BellSouth  Comments  at  4. 
 781  The  ATAs  FOIA  request  was  for  copies  of  the  over  11,000  complaints  about  telemarketing  practices  received 
 during  the  period  January  2000  through  December  2001.  The  request  also  asked  for  copies  of  all  similar  complaints  about  telemarketing  practices  the  FCC  has  received  since  January  1,  2002;  copies  of  the  over  1,500 


 inquiries  about  predictive  dialing  received  from  June  2000  to  December  2001;  and  any  non-  publicly  released  FCC  responses  to  the  above-  referenced  complaints.  See  Motion  For  Extension  of  Time  filed  by  the  ATA,  CG  Docket 
 No.  02-  278,  Tab  1,  Electronic  FOIA  Request  from  Ronnie  London.  On  November  14,  2002,  following  a  meeting  with  the  ATA  regarding  its  FOIA  request,  CGB  confirmed  in  a  letter  to  ATA  counsel  that  it  would  take  a  number 
 of  months  and  considerable  staff  resources  in  order  to  provide  the  over  11,000  documents  covered  by  the  request.  See  Letter  from  K.  Dane  Snowden,  FCC,  to  Ronnie  London,  Counsel  to  ATA,  November  14,  2002. 


 782  See  5  U.  S.  C.    552. 
 783  5  U.  S.  C.    552(  b)(  6);  see  also  47  C.  F.  R.    0.441  et  seq. 
 784  5  U.  S.  C.    552(  a);  47  C.  F.  R.    0.551  et  seq. 
 785  We  explained  that  informal  complaints  often  contain  personally  identifiable  information  such  as  addresses, 
 phone  numbers,  social  security  numbers,  and  personal  financial  information.  The  ATA  subsequently  filed  an  Application  for  Review  of  the  Freedom  of  Information  Action,  requesting  that  the  Commission  overturn  the 


 staffs  classification  of  the  telemarketing  complaints  and  predictive  dialing  inquiries  as  not  routinely  available  documents  and  immediately  release  them  for  public  consideration.  See  Review  of  Freedom  of  Information  Action 
 filed  by  the  ATA  at  5,  CG  Docket  No.  02-  278,  December  6,  2002.  (In  the  alternative,  ATA  requested  that  the  Commission  require  the  staff  to  significantly  accelerate  its  release  of  the  redacted  documents  in  time  for 
 consideration  of  them  in  the  notice  and  comment  period,  and  to  substantially  reduce  or  waive  the  charge  associated  with  producing  the  requested  documents.)  On  December  23,  2002,  the  ATA  filed  a  Motion  for 
 Expedited  Review  of  its  Application  for  Review  of  the  Freedom  of  Information  Act  Action  to  ensure  that  ATA  and  (continued.) 
126

 Federal  Communications  Commission  FCC  03-  153 
 127 
 provided  approximately  2,420  redacted  complaints.  786 
 216.  We  agree  with  commenters  that  the  increasing  number  of  inquiries  and  complaints  about  telemarketing  practices  should  not  form  the  basis  upon  which  we  revise  or 


 adopt  new  rules  under  the  TCPA.  787  Rather,  such  information  can  be  considered  in  determining  whether  to  seek  comment  on  the  effectiveness  of  any  of  its  rules.  788  We  note  that,  even  in  the 
 absence  of  any  such  complaints,  the  Commission  is  required  by  the  Do-  Not-  Call  Act  to  complete  the  TCPA  rulemaking  commenced  last  year.  We  disagree  with  commenters  who  suggest  that 
 parties  must  have  access  to  all  of  the  complaints  referenced  in  the  NPRM  in  order  to  be  able  to  have  a  meaningful  opportunity  to  participate  in  this  proceeding.  789  It  is  not  the  existence  of  the 
 complaints,  or  the  number  of  complaints,  that  led  the  Commission  to  institute  this  proceeding  to  consider  revision  of  its  TCPA  rules.  Rather,  our  TCPA  rules  have  been  in  place  for  more  than 
 ten  years.  We  opened  this  proceeding  to  determine  whether  the  Commissions  rules  need  to  be  revised  in  order  to  more  effectively  carry  out  Congresss  directives  in  the  TCPA.  790  In  any 
 event,  since  September  2002,  consumers,  industry,  and  state  governments  have  filed  over  6,000  comments  in  this  proceeding,  during  which  time  the  Commission  extended  the  comment  periods 
 twice  and  released  a  Further  Notice  in  order  to  ensure  that  parties  had  ample  opportunity  to  comment  on  possible  FCC  action.  The  substantial  record  compiled  in  this  proceeding,  along 
 with  the  Commissions  own  enforcement  experience,  provides  the  basis  for  the  actions  we  take  here  today. 


 B.  Reports  to  Congress 
 217.  The  Do-  Not-  Call  Act  requires  the  Commission  to  transmit  reports  to  Congress 


 (Continued  from  previous  page)  other  parties  participating  in  the  .  .  .  proceeding  are  afforded  timely  access  to  critical  documents  central  to  the 
 issues  raised.  .  .by  the  [2002  Notice].  See  Motion  for  Expedited  Review  at  1. 
 786  As  directed  by  the  ATA,  the  Commission  stopped  processing  the  FOIA  on  January  27,  2003.  The  comment 
 period  in  this  proceeding  was  subsequently  extended  following  the  release  of  a  Further  Notice,  and  the  ATA  wrote  to  the  Commission  asking  that  the  FOIA  processing  continue.  However,  the  ATA  did  not  represent  that  it  would 


 pay  the  additional  FOIA  fees  that  would  accrue  from  the  processing,  and  CGB  wrote  to  the  ATA  for  further  directions.  The  ATA  then  paid  for  complaint  records  provided  through  January  27,  2003,  and  asked  the 
 Commission  to  continue  processing  the  request.  CGB  has  provided  the  ATA  with  a  total  of  2,420  redacted  complaints  thus  far. 


 787  See,  e.  g.,  ATA  Comments  at  36  (noting  that  the  Commissions  tally  of  complaints,  inquiries  and  website  visits 
 fails  to  demonstrate  a  significant  problem  .  .  .  the  existence  of  a  complaint  does  not  amount  to  a  violation  of  the  rules.) 


 788  Other  considerations  included:  the  Commissions  own  enforcement  experience;  the  amount  of  time  that  had 
 passed  since  the  Commission  undertook  a  broad  review  of  the  TCPA  rules,  during  which  time  telemarketing  practices  have  changed  significantly;  and  the  actions  by  the  FTC  to  consider  changes  to  its  telemarketing  rules, 


 including  the  establishment  of  a  national  do-  not-  call  registry.  See  2002  Notice,  17  FCC  Rcd  at  17464-  68,  para.  7-  11. 


 789  See,  e.  g.,  ATA  Comments  at  41. 
 790  2002  Notice,  17  FCC  Rcd  at  17461,  para.  1. 
127

 Federal  Communications  Commission  FCC  03-  153 
 128 
 within  45  days  after  the  promulgation  of  final  rules  in  this  proceeding,  and  annually  thereafter.  791  By  this  Order,  the  Commission  delegates  its  authority  to  the  Chief,  Consumer  &  Governmental 
 Affairs  Bureau,  to  issue  all  such  reports. 
 XIX.  PROCEDURAL  ISSUES 
 A.  Regulatory  Flexibility  Act  Analysis 
 218.  Pursuant  to  the  Regulatory  Flexibility  Act  of  1980,  as  amended,  792  the  Commissions  Final  Regulatory  Flexibility  Analysis  in  this  Order  is  attached  as  Appendix  B. 


 B.  Paperwork  Reduction  Act  Analysis 
 219.  This  Order  contains  modified  information  collections  subject  to  the  Paperwork  Reduction  Act  of  1995  (PRA),  Public  Law  104-  13.  It  will  be  submitted  to  the  Office  of 


 Management  and  Budget  (OMB)  for  review  under    3507(  d)  of  the  PRA.  OMB,  the  general  public,  and  other  Federal  agencies  are  invited  to  comment  on  the  modified  information 
 collections  contained  in  this  proceeding. 
 C.  Late-  Filed  Comments 
 220.  We  note  that  there  were  comments  filed  late  in  this  proceeding.  In  the  interest  of  having  as  complete  and  accurate  a  record  as  possible,  we  will  accept  late-  filed  comments  and 


 waive  the  requirements  of  47  C.  F.  R.    1.46(  b). 
 D.  Materials  in  Accessible  Formats 
 221.  To  request  materials  in  accessible  formats  for  people  with  disabilities  (braille,  large  print,  electronic  files,  audio  format),  send  an  email  to  fcc504@  fcc.  gov  or  call  the 


 Consumer  &  Governmental  Affairs  Bureau  at  (202)  418-  0531  (voice),  (202)  418-  7365  (TTY).  This  Report  and  Order  can  also  be  downloaded  in  Text  and  ASCII  formats  at: 
 http://  www.  fcc.  gov/  cgb/  policy/  telemarketing.  html. 
 XX.  ORDERING  CLAUSES 
 222.  Accordingly,  IT  IS  ORDERED  that,  pursuant  to  the  authority  contained  in  Sections  1-  4,  222,  227,  and  303(  r)  of  the  Communications  Act  of  1934,  as  amended;  47  U.  S.  C. 


   151-  154,  222  and  227;  and  47  C.  F.  R.    64.1200  of  the  Commissions  rules,  and  the  Do-  Not-Call  Implementation  Act,  Pub.  L.  No.  108-  10,  117  Stat.  557,  the  Report  and  Order  in  CG  Docket 
 No.  02-  278  IS  ADOPTED,  and  Parts  64  and  68  of  the  Commissions  rules,  47  C.  F.  R.  Parts  64.1200,  64.1601,  and  68.318,  are  amended  as  set  forth  in  Appendix  A.  The  requirements  of  this 
 Report  and  Order  shall  become  effective  30  days  after  publication  of  a  summary  thereof  in  the  Federal  Register,  with  the  following  exceptions.  As  discussed  herein,  the  national  do-  not-  call 
 rules  at  47  C.  F.  R.    64.1200(  c)(  2)  will  go  into  effect  on  October  1,  2003;  the  call  abandonment 
 791  See  Do-  Not-  Call  Act,  Sec.  4. 
 792  See  5  U.  S.  C.    604. 
128

 Federal  Communications  Commission  FCC  03-  153 
 129 
 rules  at  47  C.  F.  R.    64.1200(  a)(  5)  and  (6)  will  become  effective  on  October  1,  2003;  and  the  caller  ID  requirements  at  47  C.  F.  R.    64.1601(  e)  will  go  into  effect  on  January  29,  2004.  The 
 amendments  to  the  rules  in    64.1200  that  contain  information  collection  requirements  under  the  PRA  are  not  effective  until  approved  by  OMB.  The  Commission  will  publish  a  document  in  the 
 Federal  Register  announcing  the  effective  date  of  these  rules. 
 223.  IT  IS  FURTHER  ORDERED  that  the  comments  addressing  the  applicability  of  the  informal  complaint  rules  to  telemarketers  ARE  INCORPORATED  into  CI  Docket  02-  32. 


 224.  IT  IS  FURTHER  ORDERED  that  the  Commissions  Consumer  &  Governmental  Affairs  Bureau  shall  have  authority  to  issue  any  reports  to  Congress  as  required  by  the  Do-  Not-Call 
 Implementation  Act. 
 225.  IT  IS  FURTHER  ORDERED  that  the  Commissions  Consumer  &  Governmental  Affairs  Bureau,  Reference  Information  Center,  SHALL  SEND  a  copy  of  this  Report  and  Order, 


 including  the  Final  Regulatory  Flexibility  Analysis,  to  the  Chief  Counsel  for  Advocacy  of  the  Small  Business  Administration. 


 FEDERAL  COMMUNICATIONS  COMMISSION 


 Marlene  H.  Dortch  Secretary 
129

 Federal  Communications  Commission  FCC  03-  153 
 130 
 Appendix  A 
 Final  Rules 
 Part  64  of  the  Code  of  Federal  Regulations  is  amended  as  follows: 
 PART  64    MISCELLANEOUS  RULES  RELATING  TO  COMMON  CARRIERS 
 1.  Authority:  47  U.  S.  C.    227. 
 *  *  *  *  *  2.  Subpart  L  is  amended  by  revising  the  Subpart  Heading  to  read  as  follows: 


 Subpart  L    Restrictions  on  Telemarketing  and  Telephone  Solicitation 
 *  *  *  *  *  3.  Section  64.1200  is  revised  to  read  as  follows: 


   64.1200  Delivery  restrictions. 
 (a)  No  person  or  entity  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, 
 (i)  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; 
 (ii)  To  the  telephone  line  of  any  guest  room  or  patient  room  of  a  hospital,  health  care  facility,  elderly  home,  or  similar  establishment;  or 


 (iii)  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  line  using  an  artificial  or  prerecorded  voice  to  deliver  a  message  without  the  prior  express  consent  of  the  called  party,  unless  the  call: 


 (i)  Is  made  for  emergency  purposes, 
 (ii)  Is  not  made  for  a  commercial  purpose, 
 (iii)  Is  made  for  a  commercial  purpose  but  does  not  include  or  introduce  an  unsolicited  advertisement  or  constitute  a  telephone  solicitation, 
130

 Federal  Communications  Commission  FCC  03-  153 
 131 
 (iv)  Is  made  to  any  person  with  whom  the  caller  has  an  established  business  relationship  at  the  time  the  call  is  made,  or 
 (v)  Is  made  by  or  on  behalf  of  a  tax-  exempt  nonprofit  organization. 
 (3)  Use  a  telephone  facsimile  machine,  computer,  or  other  device  to  send  an  unsolicited  advertisement  to  a  telephone  facsimile  machine. 


 (i)  For  purposes  of  paragraph  (a)(  3)  of  this  section,  a  facsimile  advertisement  is  not  unsolicited  if  the  recipient  has  granted  the  sender  prior  express  invitation  or  permission  to  deliver  the 
 advertisement,  as  evidenced  by  a  signed,  written  statement  that  includes  the  facsimile  number  to  which  any  advertisements  may  be  sent  and  clearly  indicates  the  recipients  consent  to  receive 
 such  facsimile  advertisements  from  the  sender. 
 (ii)  A  facsimile  broadcaster  will  be  liable  for  violations  of  paragraph  (a)(  3)  of  this  section  if  it  demonstrates  a  high  degree  of  involvement  in,  or  actual  notice  of,  the  unlawful  activity  and  fails 
 to  take  steps  to  prevent  such  facsimile  transmissions. 
 (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. 


 (5)  Disconnect  an  unanswered  telemarketing  call  prior  to  at  least  15  seconds  or  four  (4)  rings. 
 (6)  Abandon  more  than  three  percent  of  all  telemarketing  calls  that  are  answered  live  by  a  person,  measured  over  a  30-  day  period.  A  call  is  abandoned  if  it  is  not  connected  to  a  live 
 sales  representative  within  two  (2)  seconds  of  the  called  persons  completed  greeting.  Whenever  a  sales  representative  is  not  available  to  speak  with  the  person  answering  the  call,  that  person 
 must  receive,  within  two  (2)  seconds  after  the  called  persons  completed  greeting,  a  prerecorded  identification  message  that  states  only  the  name  and  telephone  number  of  the  business,  entity,  or 
 individual  on  whose  behalf  the  call  was  placed,  and  that  the  call  was  for  telemarketing  purposes.  The  telephone  number  so  provided  must  permit  any  individual  to  make  a  do-  not-  call 
 request  during  regular  business  hours  for  the  duration  of  the  telemarketing  campaign.  The  telephone  number  may  not  be  a  900  number  or  any  other  number  for  which  charges  exceed  local 
 or  long  distance  transmission  charges.  The  seller  or  telemarketer  must  maintain  records  establishing  compliance  with  paragraph  (a)(  6)  of  this  section. 


 (i)  A  call  for  telemarketing  purposes  that  delivers  an  artificial  or  prerecorded  voice  message  to  a  residential  telephone  line  that  is  assigned  to  a  person  who  either  has  granted  prior  express 
 consent  for  the  call  to  be  made  or  has  an  established  business  relationship  with  the  caller  shall  not  be  considered  an  abandoned  call  if  the  message  begins  within  two  (2)  seconds  of  the  called 
 persons  completed  greeting. 
 (ii)  Calls  made  by  or  on  behalf  of  tax-  exempt  nonprofit  organizations  are  not  covered  by  paragraph  (a)(  6)  of  this  section. 


 (7)  Use  any  technology  to  dial  any  telephone  number  for  the  purpose  of  determining  whether  the  line  is  a  facsimile  or  voice  line. 
131

 Federal  Communications  Commission  FCC  03-  153 
 132 
 (b)  All  artificial  or  prerecorded  telephone  messages  shall: 
 (1)  At  the  beginning  of  the  message,  state  clearly  the  identity  of  the  business,  individual,  or  other  entity  that  is  responsible  for  initiating  the  call.  If  a  business  is  responsible  for  initiating  the  call, 
 the  name  under  which  the  entity  is  registered  to  conduct  business  with  the  State  Corporation  Commission  (or  comparable  regulatory  authority)  must  be  stated,  and 


 (2)  During  or  after  the  message,  state  clearly  the  telephone  number  (other  than  that  of  the  autodialer  or  prerecorded  message  player  that  placed  the  call)  of  such  business,  other  entity,  or 
 individual.  The  telephone  number  provided  may  not  be  a  900  number  or  any  other  number  for  which  charges  exceed  local  or  long  distance  transmission  charges.  For  telemarketing  messages 
 to  residential  telephone  subscribers,  such  telephone  number  must  permit  any  individual  to  make  a  do-  not-  call  request  during  regular  business  hours  for  the  duration  of  the  telemarketing 
 campaign. 
 (c)  No  person  or  entity  shall  initiate  any  telephone  solicitation,  as  defined  in  paragraph  (f)(  9)  of  this  section,  to: 


 (1)  Any  residential  telephone  subscriber  before  the  hour  of  8  a.  m.  or  after  9  p.  m.  (local  time  at  the  called  partys  location),  or 
 (2)  A  residential  telephone  subscriber  who  has  registered  his  or  her  telephone  number  on  the  national  do-  not-  call  registry  of  persons  who  do  not  wish  to  receive  telephone  solicitations  that  is 
 maintained  by  the  federal  government.  Such  do-  not-  call  registrations  must  be  honored  for  a  period  of  5  years.  Any  person  or  entity  making  telephone  solicitations  (or  on  whose  behalf 
 telephone  solicitations  are  made)  will  not  be  liable  for  violating  this  requirement  if: 
 (i)  it  can  demonstrate  that  the  violation  is  the  result  of  error  and  that  as  part  of  its  routine  business  practice,  it  meets  the  following  standards: 


 (A)  Written  procedures.  It  has  established  and  implemented  written  procedures  to  comply  with  the  national  do-  not-  call  rules; 
 (B)  Training  of  personnel.  It  has  trained  its  personnel,  and  any  entity  assisting  in  its  compliance,  in  procedures  established  pursuant  to  the  national  do-  not-  call  rules; 
 (C)  Recording.  It  has  maintained  and  recorded  a  list  of  telephone  numbers  that  the  seller  may  not  contact; 
 (D)  Accessing  the  national  do-  not-  call  database.  It  uses  a  process  to  prevent  telephone  solicitations  to  any  telephone  number  on  any  list  established  pursuant  to  the  do-  not-  call  rules, 
 employing  a  version  of  the  national  do-  not-  call  registry  obtained  from  the  administrator  of  the  registry  no  more  than  three  months  prior  to  the  date  any  call  is  made,  and  maintains  records 
 documenting  this  process;  and  (E)  Purchasing  the  national  do-  not-  call  database.  It  uses  a  process  to  ensure  that  it  does  not  sell, 
 rent,  lease,  purchase  or  use  the  national  do-  not-  call  database,  or  any  part  thereof,  for  any  purpose  except  compliance  with  this  section  and  any  such  state  or  federal  law  to  prevent  telephone 
 solicitations  to  telephone  numbers  registered  on  the  national  database.  It  purchases  access  to  the  relevant  do-  not-  call  data  from  the  administrator  of  the  national  database  and  does  not  participate 
132

 Federal  Communications  Commission  FCC  03-  153 
 133 
 in  any  arrangement  to  share  the  cost  of  accessing  the  national  database,  including  any  arrangement  with  telemarketers  who  may  not  divide  the  costs  to  access  the  national  database 
 among  various  client  sellers;  or 
 (ii)  It  has  obtained  the  subscribers  prior  express  invitation  or  permission.  Such  permission  must  be  evidenced  by  a  signed,  written  agreement  between  the  consumer  and  seller  which  states  that 
 the  consumer  agrees  to  be  contacted  by  this  seller  and  includes  the  telephone  number  to  which  the  calls  may  be  placed;  or 


 (iii)  The  telemarketer  making  the  call  has  a  personal  relationship  with  the  recipient  of  the  call. 
 (d)  No  person  or  entity  shall  initiate  any  call  for  telemarketing  purposes  to  a  residential  telephone  subscriber  unless  such  person  or  entity  has  instituted  procedures  for  maintaining  a  list 
 of  persons  who  request  not  to  receive  telemarketing  calls  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  calls  for  telemarketing  purposes  must  have  a  written  policy,  available  upon  demand,  for  maintaining  a  do-  not-  call  list. 
 (2)  Training  of  personnel  engaged  in  telemarketing.  Personnel  engaged  in  any  aspect  of  telemarketing  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  call  for  telemarketing  purposes  (or  on  whose  behalf  such  a  call  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  subscribers  name,  if  provided,  and  telephone 
 number  on  the  do-  not-  call  list  at  the  time  the  request  is  made.  Persons  or  entities  making  calls  for  telemarketing  purposes  (or  on  whose  behalf  such  calls  are  made)  must  honor  a  residential 
 subscribers  do-  not-  call  request  within  a  reasonable  time  from  the  date  such  request  is  made.  This  period  may  not  exceed  thirty  days  from  the  date  of  such  request.  If  such  requests  are 
 recorded  or  maintained  by  a  party  other  than  the  person  or  entity  on  whose  behalf  the  telemarketing  call  is  made,  the  person  or  entity  on  whose  behalf  the  telemarketing  call  is  made 
 will  be  liable  for  any  failures  to  honor  the  do-  not-  call  request.  A  person  or  entity  making  a  call  for  telemarketing  purposes  must  obtain  a  consumers  prior  express  permission  to  share  or 
 forward  the  consumers  request  not  to  be  called  to  a  party  other  than  the  person  or  entity  on  whose  behalf  a  telemarketing  call  is  made  or  an  affiliated  entity. 


 (4)  Identification  of  sellers  and  telemarketers.  A  person  or  entity  making  a  call  for  telemarketing  purposes  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.  The  telephone  number  provided  may  not  be  a  900 
 number  or  any  other  number  for  which  charges  exceed  local  or  long  distance  transmission  charges. 


 (5)  Affiliated  persons  or  entities.  In  the  absence  of  a  specific  request  by  the  subscriber  to  the  contrary,  a  residential  subscribers  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 
133

 Federal  Communications  Commission  FCC  03-  153 
 134 
 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  calls  for  telemarketing  purposes  must  maintain  a  record  of  a  callers  request  not  to  receive  further  telemarketing  calls.  A  do-  not-call 
 request  must  be  honored  for  5  years  from  the  time  the  request  is  made. 
 (7)  Tax-  exempt  nonprofit  organizations  are  not  required  to  comply  with  64.1200(  d). 
 (e)  The  rules  set  forth  in  sections  64.1200(  c)  and  64.1200(  d)  are  applicable  to  any  person  or  entity  making  telephone  solicitations  or  telemarketing  calls  to  wireless  telephone  numbers  to  the 
 extent  described  in  the  Commissions  Report  and  Order,  CG  Docket  No.  02-  278,  FCC  03-  153,  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991. 


 (f)  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  emergency  purposes  means  calls  made  necessary  in  any  situation  affecting  the  health  and  safety  of  consumers. 


 (3)  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  the  subscribers  purchase  or  transaction  with  the  entity  within  the  eighteen  (18)  months  immediately  preceding  the  date  of  the  telephone 
 call  or  on  the  basis  of  the  subscribers  inquiry  or  application  regarding  products  or  services  offered  by  the  entity  within  the  three  months  immediately  preceding  the  date  of  the  call,  which 
 relationship  has  not  been  previously  terminated  by  either  party. 
 (i)  The  subscribers  seller-  specific  do-  not-  call  request,  as  set  forth  in  paragraph  (d)(  3)  of  this  section,  terminates  an  established  business  relationship  for  purposes  of  telemarketing  and 
 telephone  solicitation  even  if  the  subscriber  continues  to  do  business  with  the  seller. 
 (ii)  The  subscribers  established  business  relationship  with  a  particular  business  entity  does  not  extend  to  affiliated  entities  unless  the  subscriber  would  reasonably  expect  them  to  be  included 
 given  the  nature  and  type  of  goods  or  services  offered  by  the  affiliate  and  the  identity  of  the  affiliate. 


 (4)  The  term  facsimile  broadcaster  means  a  person  or  entity  that  transmits  messages  to  telephone  facsimile  machines  on  behalf  of  another  person  or  entity  for  a  fee. 
 (5)  The  term  seller  means  the  person  or  entity  on  whose  behalf  a  telephone  call  or  message  is  initiated  for  the  purpose  of  encouraging  the  purchase  or  rental  of,  or  investment  in,  property, 
 goods,  or  services,  which  is  transmitted  to  any  person. 
134

 Federal  Communications  Commission  FCC  03-  153 
 135 
 (6)  The  term  telemarketer  means  the  person  or  entity  that  initiates  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. 
 (7)  The  term  telemarketing  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. 
 (8)  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. 


 (9)  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: 
 (i)  To  any  person  with  that  persons  prior  express  invitation  or  permission. 
 (ii)  To  any  person  with  whom  the  caller  has  an  established  business  relationship;  or 
 (iii)  By  or  on  behalf  of  a  tax-  exempt  nonprofit  organization. 
 (10)  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  persons  prior  express  invitation  or  permission. 
 (11)  The  term  personal  relationship  means  any  family  member,  friend,  or  acquaintance  of  the  telemarketer  making  the  call. 


 (g)  Beginning  January  1,  2004,  common  carriers  shall: 
 (1)  When  providing  local  exchange  service,  provide  an  annual  notice,  via  an  insert  in  the  subscribers  bill,  of  the  right  to  give  or  revoke  a  notification  of  an  objection  to  receiving 
 telephone  solicitations  pursuant  to  the  national  do-  not-  call  database  maintained  by  the  federal  government  and  the  methods  by  which  such  rights  may  be  exercised  by  the  subscriber.  The 
 notice  must  be  clear  and  conspicuous  and  include,  at  a  minimum,  the  Internet  address  and  toll-free  number  that  residential  telephone  subscribers  may  use  to  register  on  the  national  database. 


 (2)  When  providing  service  to  any  person  or  entity  for  the  purpose  of  making  telephone  solicitations,  make  a  one-  time  notification  to  such  person  or  entity  of  the  national  do-  not-  call 
 requirements,  including,  at  a  minimum,  citation  to  47  C.  F.  R.    64.1200  and  16  C.  F.  R.  Part  310.  Failure  to  receive  such  notification  will  not  serve  as  a  defense  to  any  person  or  entity  making 
 telephone  solicitations  from  violations  of  this  section. 
 (h)  The  administrator  of  the  national  do-  not-  call  registry  that  is  maintained  by  the  federal  government  shall  make  the  telephone  numbers  in  the  database  available  to  the  States  so  that  a 
135

 Federal  Communications  Commission  FCC  03-  153 
 136 
 State  may  use  the  telephone  numbers  that  relate  to  such  State  as  part  of  any  database,  list  or  listing  system  maintained  by  such  State  for  the  regulation  of  telephone  solicitations. 
   64.1601  Delivery  requirements  and  privacy  restrictions. 
 4.  Section  64.1601  is  amended  by  adding  paragraph  (e)  to  read  as  follows: 
 *  *  *  *  *  (e)  Any  person  or  entity  that  engages  in  telemarketing,  as  defined  in  section  64.1200(  f)(  7)  must 
 transmit  caller  identification  information. 
 (i)  For  purposes  of  this  paragraph,  caller  identification  information  must  include  either  CPN  or  ANI,  and,  when  available  by  the  telemarketers  carrier,  the  name  of  the  telemarketer.  It  shall  not 
 be  a  violation  of  this  paragraph  to  substitute  (for  the  name  and  phone  number  used  in,  or  billed  for,  making  the  call)  the  name  of  the  seller  on  behalf  of  which  the  telemarketing  call  is  placed 
 and  the  sellers  customer  service  telephone  number.  The  telephone  number  so  provided  must  permit  any  individual  to  make  a  do-  not-  call  request  during  regular  business  hours. 


 (ii)  Any  person  or  entity  that  engages  in  telemarketing  is  prohibited  from  blocking  the  transmission  of  caller  identification  information. 
 (iii)  Tax-  exempt  nonprofit  organizations  are  not  required  to  comply  with  this  paragraph. 
   68.318  Additional  limitations. 
 5.  Section  68.318  is  amended  by  revising  (d)  to  read  as  follows: 
 *  *  *  *  *  (d)  Telephone  facsimile  machines;  Identification  of  the  sender  of  the  message.  It  shall  be 
 unlawful  for  person  within  the  United  States  to  use  a  computer  or  other  electronic  device  to  send  any  message  via  a  telephone  facsimile  machine  unless  such  person  clearly  marks,  in  a  margin  at 
 the  top  or  bottom  of  each  transmitted  page  of  the  message  or  on  the  first  page  of  the  transmission,  the  date  and  time  it  is  sent  and  an  identification  of  the  business,  other  entity,  or 
 individual  sending  the  message  and  the  telephone  number  of  the  sending  machine  or  of  such  business,  other  entity,  or  individual.  If  a  facsimile  broadcaster  demonstrates  a  high  degree  of 
 involvement  in  the  senders  facsimile  messages,  such  as  supplying  the  numbers  to  which  a  message  is  sent,  that  broadcasters  name,  under  which  it  is  registered  to  conduct  business  with 
 the  State  Corporation  Commission  (or  comparable  regulatory  authority),  must  be  identified  on  the  facsimile,  along  with  the  senders  name.  Telephone  facsimile  machines  manufactured  on  and 
 after  December  20,  1992,  must  clearly  mark  such  identifying  information  on  each  transmitted  page. 


 *  *  *  *  * 
136

 Federal  Communications  Commission  FCC  03-  153 
 137 
 Appendix  B 
 FINAL  REGULATORY  FLEXIBILITY  ANALYSIS 
 1.  As  required  by  the  Regulatory  Flexibility  Act  of  1980,  as  amended  (RFA),  793  an  Initial  Regulatory  Flexibility  Analysis  (IRFA)  was  incorporated  in  the  Notice  of  Proposed 


 Rulemaking  and  Memorandum  Opinion  and  Order  794  (2002  Notice)  released  by  the  Federal  Communications  Commission  (Commission)  on  September  18,  2002.  The  Commission  sought 
 written  public  comments  on  the  proposals  contained  in  the  2002  Notice,  including  comments  on  the  IRFA.  On  March  25,  2003,  the  Commission  released  a  Further  Notice  of  Proposed 
 Rulemaking  (Further  Notice),  seeking  comments  on  the  requirements  contained  in  the  Do-  Not-Call  Implementation  Act  (Do-  Not-  Call  Act),  795  which  was  signed  into  law  on  March  11,  2003.  796 
 None  of  the  comments  filed  in  this  proceeding  were  specifically  identified  as  comments  addressing  the  IRFA;  however,  comments  that  address  the  impact  of  the  proposed  rules  and 
 policies  on  small  entities  are  discussed  below.  This  present  Final  Regulatory  Flexibility  Analysis  (FRFA)  conforms  to  the  RFA.  797 


 A.  Need  for,  and  Objectives  of,  the  Order 
 2.  Since  1992,  when  the  Commission  adopted  rules  pursuant  to  the  Telephone  Consumer  Protection  Act  (TCPA),  798  telemarketing  practices  have  changed  significantly.  New 


 technologies  have  emerged  that  allow  telemarketers  to  better  target  potential  customers  and  make  marketing  using  telephones  and  facsimile  machines  more  cost-  effective.  At  the  same  time, 
 these  new  telemarketing  techniques  have  heightened  public  concern  about  the  effect  telemarketing  has  on  consumer  privacy.  A  growing  number  of  states  have  passed,  or  are 
 considering,  legislation  to  establish  statewide  do-  not-  call  lists,  and  the  Federal  Trade  Commission  (FTC)  has  decided  to  establish  a  national  do-  not-  call  registry.  799  Congress  provided 
 in  the  TCPA  that  individuals  privacy  rights,  public  safety  interests,  and  commercial  freedoms 
 793  See  5  U.  S.  C.    603.  The  RFA,  see  5  U.  S.  C.    601-  612,  has  been  amended  by  the  Small  Business  Regulatory 
 Enforcement  Fairness  Act  of  1996  (SBREFA),  Pub.  L.  No.  104-  121,  Title  II,  110  Stat.  857  (1996). 
 794  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  Notice  of  Proposed 
 Rulemaking  (NPRM)  and  Memorandum  Opinion  and  Order  (MO&  O),  17  FCC  Rcd  17459,  CG  Docket  No.  02-  278  and  CC  Docket  No.  92-  90.  In  the  MO&  O,  the  Commission  closed  and  terminated  CC  Docket  No.  92-  90  and 


 opened  a  new  docket  to  address  the  issues  raised  in  this  proceeding. 
 795  Do-  Not-  Call  Implementation  Act,  Pub.  L.  No.  108-  10,  117  Stat.  557  (2003),  to  be  codified  at  15  U.  S.  C.   
 1601. 
 796  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  CG  Docket  No.  02-  278, 
 Further  Notice  of  Proposed  Rulemaking,  68  Fed.  Reg.  16250  (March  25,  2003). 
 797  See  5  U.  S.  C.    604. 


 798  Telephone  Consumer  Protection  Act  of  1991,  Pub.  L.  No.  102-  243,  105  Stat.  2394  (1991),  codified  at  47 
 U.  S.  C.    227.  The  TCPA  amended  Title  II  of  the  Communications  Act  of  1934,  47  U.  S.  C.    201  et  seq. 
 799  See  Telemarketing  Sales  Rule,  68  Fed.  Reg.  4580  (Jan.  29,  2003). 
137

 Federal  Communications  Commission  FCC  03-  153 
 138 
 of  speech  and  trade  must  be  balanced  in  a  way  that  protects  the  privacy  of  individuals  and  permits  legitimate  telemarketing  practices.  800 
 3.  The  2002  Notice  sought  comments  on  whether  to  revise  or  clarify  Commission  rules  governing  unwanted  telephone  solicitations,  the  use  of  automatic  telephone  dialing 
 systems,  prerecorded  or  artificial  voice  messages,  telephone  facsimile  machines,  the  effectiveness  of  company-  specific  do-  not-  call  lists,  and  the  appropriateness  of  establishing  a 
 national  do-  not-  call  list.  In  addition,  in  the  IRFA,  the  Commission  sought  comments  on  the  effect  the  proposed  policies  and  rules  would  have  on  small  business  entities.  801 


 4.  In  this  Report  and  Order  (Order)  the  Commission  revises  the  current  TCPA  rules  and  adopts  new  rules  to  provide  consumers  with  additional  options  for  avoiding  unwanted 
 telephone  solicitations.  We  establish  a  national  do-  not-  call  registry  for  consumers  who  wish  to  avoid  most  unwanted  telemarketing  calls.  This  national  do-  not-  call  registry  will  supplement  the 
 current  company-  specific  do-  not-  call  rules,  which  will  continue  to  permit  consumers  to  request  that  particular  companies  not  call  them.  The  Commission  also  adopts  a  new  provision  to  permit 
 consumers  registered  with  the  national  do-  not-  call  list  to  provide  permission  to  call  to  specific  companies  by  an  express  written  agreement.  The  TCPA  rules  exempt  from  the  do-  not-  call 
 requirements  nonprofit  organizations  and  companies  with  whom  consumers  have  an  established  business  relationship.  The  definition  of  established  business  relationship  has  been  amended  so 
 that  it  is  limited  to  18  months  from  any  purchase  or  financial  transaction  with  the  company  and  to  three  months  from  any  inquiry  or  application  from  the  consumer.  Any  company  that  is  asked 
 by  a  consumer,  including  an  existing  customer,  not  to  call  again  must  honor  that  request  for  five  years.  We  retain  the  current  calling  time  restrictions  of  8:  00  a.  m.  until  9:  00  p.  m. 


 5.  To  address  the  use  of  predictive  dialers,  we  have  determined  that  a  telemarketer  must  abandon  no  more  than  three  percent  of  calls  answered  by  a  person,  must  deliver  a 
 prerecorded  identification  message  when  abandoning  a  call,  and  must  allow  the  telephone  to  ring  for  15  seconds  or  four  rings  before  disconnecting  an  unanswered  call.  The  new  rules  also 
 require  all  companies  conducting  telemarketing  to  transmit  caller  identification  information  when  available,  and  they  prohibit  companies  from  blocking  such  information.  The  Commission 
 has  revised  its  earlier  determination  that  an  established  business  relationship  constitutes  express  invitation  or  permission  to  receive  an  unsolicited  facsimile  advertisement.  We  find  that  the 
 permission  to  send  fax  ads  must  be  in  writing,  include  the  recipients  signature,  and  clearly  indicate  the  recipients  consent  to  receive  such  ads.  In  addition,  we  have  clarified  when  fax 
 broadcasters  are  liable  for  the  transmission  of  unlawful  fax  advertisements. 
 6.  We  believe  the  rules  the  Commission  adopts  in  the  Order  strike  an  appropriate  balance  between  maximizing  consumer  privacy  protections  and  avoiding  imposing  undue 


 burdens  on  telemarketers.  In  addition,  the  Commission  must  comply  with  the  Do-  Not-  Call  Act,  which  requires  the  Commission  to  file  an  annual  report  to  the  House  Committee  on  Energy  and 
 Commerce  and  the  Senate  Committee  on  Commerce,  Science  and  Transportation.  This  report  is 


 800  See  TCPA,  Section  2(  9),  reprinted  in  7  FCC  Rcd  2736  at  2744. 
 801  2002  Notice,  17  FCC  Rcd  at  17497-  501,  paras.  70-  80. 
138

 Federal  Communications  Commission  FCC  03-  153 
 139 
 to  include:  (1)  an  analysis  of  the  effectiveness  of  the  registry;  (2)  the  number  of  consumers  included  on  the  registry;  (3)  the  number  of  persons  accessing  the  registry  and  the  fees  collected 
 for  such  access;  (4)  a  description  of  coordination  with  state  do-  not-  call  registries;  and,  lastly,  (5)  a  description  of  coordination  of  the  registry  with  the  Commissions  enforcement  efforts.  802 


 B.  Summary  of  Significant  Issues  Raised  by  Public  Comments  in  Response  to  the  IRFA 
 7.  There  were  no  comments  filed  in  direct  response  to  the  IRFA.  Some  commenters,  however,  raised  issues  and  questions  about  the  impact  the  proposed  rules  and  policies  would 
 have  on  small  entities.  Telemarketers  maintained  that  telemarketing  is  used  to  introduce  consumers  to  novel  and  competitive  products  and  services,  803  often  offered  by  small 
 businesses.  804  Some  commenters  insisted  that  business-  to-  business  telemarketing  is  essential  for  small  businesses.  805  They  indicated  that  they  rely  on  fax  broadcasting  as  a  cost-  effective  form  of 
 advertising.  806  On  the  other  hand,  other  small  businesses  have  requested  that  the  Commission  allow  their  telephone  numbers  to  be  included  on  any  national  do-  not-  call  list  807  and  urged  the 
 Commission  to  adopt  rules  protecting  them  from  unsolicited  faxes.  808  The  rules  adopted  herein  reflect  not  only  the  difficult  balancing  of  individuals  privacy  rights  against  the  protections 
 afforded  commercial  speech,  but  the  difficult  balancing  of  the  interests  of  small  businesses  that  rely  on  telemarketing  against  those  that  are  harmed  by  unwanted  telephone  calls  and  facsimile 
 transmissions.  The  amended  rules  should  reduce  burdens  on  both  consumers  and  businesses,  including  small  businesses. 


 8.  National  Do-  Not-  Call  List.  As  discussed  more  extensively  in  the  Order,  809  some  commenters  opposed  the  adoption  of  a  national  do-  not-  call  registry,  stating  that  company-specific 
 do-  not-  call  lists  adequately  protect  consumer  privacy.  810  Other  commenters  supported  the  establishment  of  a  national  do-  not-  call  registry,  arguing  that  further  regulation  is  needed 
 because  the  current  system  does  little  or  nothing  to  protect  privacy  in  the  home.  811  NFIB  believes  that  significant  burdens  are  being  placed  upon  businesses  of  all  sizes  in  order  to 


 802  See  Do-  Not-  Call  Act,  Sec.  4(  b). 
 803  WorldCom  Reply  Comments  at  2. 
 804  NEMA  Comments  at  8;  PLP  Comments  at  1. 
 805  See  e.  g.,  Yellow  Pages  Comments  at  2. 
 806  NADA  Comments  at  2-  3. 
 807  John  Shaw  Reply  Comments  at  10;  Mathemaesthetics  Comments  at  6;  Gail  Berk  Comments. 
 808  John  Holcomb  Comments  at  1;  Jim  Carter  Comments. 
 809  Order,  paras.  21,  88. 
 810  See  e.  g.,  MBNA  Comments  at  4. 
 811  See  e.  g.,  Privacy  Rights  at  2. 
139

 Federal  Communications  Commission  FCC  03-  153 
 140 
 comply  with  the  regulations.  .  .,  but  that  small  businesses  bear  the  brunt  of  those  burdens.  812  NFIB  suggested  that  women,  minorities  and  small  businesses  will  be  affected  disproportionately 
 by  any  new  restrictions.  813  And,  some  commenters  maintained  that  businesses,  including  small  businesses,  will  suffer  a  reduction  in  telemarketing  sales  as  a  result  of  the  establishment  of  a 
 national  do-  not-  call  list.  814  SBSC,  while  opposed  to  a  national  do-  not-  call  list,  nevertheless  offered  a  recommendation  that  would  make  such  a  list  less  onerous  for  small  businesses.  SBSC 
 suggested  exempting  local  calls  that  might  result  in  a  face-  to-  face  transaction  from  the  do-  not-call  list  requirements.  815  NAIFA  also  encouraged  exempting  calls  which  result  in  face-  to-  face 
 meetings  and  recommended  an  exemption  for  those  businesses  that  make  a  de  minimus  number  of  calls.  816 


 9.  The  Commission  received  comments  arguing  that  a  national  do-  not-  call  list  would  be  cumbersome  817  and  too  expensive  for  small  businesses  to  use.  818  DSA  specifically 
 indicated  that  a  national  do-  not-  call  list  would  increase  businesses  start-  up  costs  if  they  were  required  to  purchase  the  list.  819  In  addition,  MBA  maintained  that  many  small  lenders  use 
 referrals  from  existing  customers,  not  large  lists,  to  attract  new  business.  Such  referrals,  MBA  suggested,  will  be  difficult  to  scrub  against  a  national  do-  not-  call  list.  820  Some  commenters 
 suggested  that  an  option  to  help  reduce  the  cost  of  a  national  do-  not-  call  list  for  small  businesses  would  be  to  offer  smaller  pieces  of  the  list  to  small  businesses.  821 


 10.  Yellow  Pages  urged  the  Commission  to  continue  to  exempt  business-  to-  business  calls  from  a  national  do-  not-  call  list,  because  small  businesses  benefit  tremendously  by 
 advertising  in  yellow  pages  and  on-  line.  822  However,  other  commenters  requested  that  small  businesses  be  allowed  to  include  their  telephone  numbers  on  the  national  do-  not-  call  list.  823  One 


 812  NFIB  Comments  at  1.  See  also,  PLP  Comments  at  4;  NEMA  Comments  at  8. 
 813  MBNA  Comments  at  3;  MBNA  Reply  at  7. 
 814  MBNA  Comments  at  3. 
 815  SBSC  Comments  at  2-  3.  See  also,  PLP  Comments  at  4-  5;  MBA  Reply  at  5-  6;  Farmers  Comments  at  1. 
 816  NAIFA  Comments  at  3-  4.  See  also,  DSA  Comments  at  6-  7  and  Vector  Comments  at  8-  10. 
 817  NAMB  Comments  at  2;  NRF  Comments  at  9-  10. 
 818  MBA  Comments  at  3. 
 819  DSA  Comments  at  4-  5.  See  also,  NAA  Comments  at  10-  11. 
 820  MBA  Comments  at  3.  See  also,  MPA  Comments  at  10-  11  (  small  businesses  will  be  daunted  by  or  unable  to 
 afford  the  computer  processing  time  and  expense  involved  in  scrubbing  their  relatively  small  marketing  lists  against  a  [national  list]);  see  also  NRF  Comments  at  9. 


 821  Strang  Reply  Comments  at  12.  See  also  Joe  W.  McDaniel-  First  Dec  4,  2002  Comments. 
 822  Yellow  Pages  Comments  at  2-  4. 
 823  Mathemaesthetics  Comments  at  6. 
140

 Federal  Communications  Commission  FCC  03-  153 
 141 
 small  business  commenter  stated  that  .  .  .  telemarketing  .  .  .  interferes  with  business  operations,  especially  small  business  operations  .  .  .  .  824  Another  commenter  argued  that  people  that  work 
 from  home  .  .  .  should  not  have  to  be  bothered  with  telemarketing  calls  that  would  impact  their  job  performance  and  potentially  their  ability  to  make  a  living.  825  Finally,  some  have  assured  the 
 Commission  that  a  national  do-  not-  call  list  would  be  manageable  and  feasible  to  maintain.  826  NCS,  for  example,  maintained  that  even  extremely  small  telemarketers  could  gain  access  to  the 
 do-  not-  call  list  at  a  reasonable  cost  using  the  Internet.  827 
 11.  Website  or  Toll-  Free  Number  to  Access  Company-  Specific  Lists  and  to  Confirm  Requests.  The  Commission  sought  comment  on  whether  to  consider  any  modifications  that 


 would  allow  consumers  greater  flexibility  to  register  on  company-  specific  do-  not-  call  lists.  828  We  specifically  asked  whether  companies  should  be  required  to  provide  a  toll-  free  number 
 and/  or  website  that  consumers  can  access  to  register  their  names  on  do-  not-  call  lists.  829  Some  commenters  argued  that  it  would  be  costly  if  small,  local  businesses  were  required  to  design  and 
 maintain  websites  or  provide  toll-  free  numbers  for  consumers  to  make  do-  not-  call  requests.  830  In  addition,  they  maintained  that  businesses  should  not  be  required  to  confirm  registration  of  a 
 consumers  name  on  a  companys  do-  not-  call  list.  831  Confirmations  by  mail,  they  stated,  would  be  expensive  for  a  business  and  probably  perceived  by  the  consumer  as  junk  mail.  832 


 12.  Established  Business  Relationship.  One  issue  raised  by  commenters  as  particularly  burdensome  for  small  business  was  monitoring  existing  business  relationships  and 
 do-  not-  call  requests.  NFIB  stated  that  members  have  found  requests  by  existing  customers  to  cease  contacting  them  unwieldy  and  difficult  .  .  .  to  translate  as  a  business  practice.  833  An 
 individual  who  continues  to  interact  with  a  [sic]  these  small  businesses  following  a  do  not  contact  request  does  not  sever  the  business  relationship  de  facto.  .  .  834  According  to  NFIB,  it 
 should  be  the  right  of  the  business  to  continue  to  call  that  customer.  They  argued  that  it  should  be  the  responsibility  of  the  customer  to  terminate  the  relationship  with  that  business 


 824  Mathemaesthetics  Comments  at  6. 
 825  David  T.  Piekarski  Comments  (Docket  No.  03-  62)  at  1-  2. 
 826  NCS  Comments  at  4-  5.  See  also,  Mathemaesthetics  Comments  at  7-  8. 
 827  NCS  Comments  at  5. 
 828  2002  Notice,  17  FCC  Rcd  at  17470-  71,  para.  17. 
 829  2002  Notice,  17  FCC  Rcd  at  17470-  71,  para.  17. 
 830  MBA  Comments  at  6. 
 831  MBA  Comments  at  6-  7. 
 832  MBA  Comments  at  6-  7. 
 833  NFIB  Comments  at  2. 
 834  NFIB  Comments  at  2. 
141

 Federal  Communications  Commission  FCC  03-  153 
 142 
 affirmatively.  835 
 13.  NADA  indicated  that  there  has  been  no  significant  change  that  would  warrant  a  revision  of  the  established  business  relationship  exemption.  836  In  fact,  NADA  stated  that 


 narrowing  the  exemption  would  unnecessarily  deprive  small  businesses  of  a  cost-  effective  marketing  opportunity.  837  According  to  NADA,  small  businesses  must  maximize  their 
 marketing  resources  and  the  best  way  to  do  so  is  to  direct  their  marketing  efforts  toward  their  existing  customers.  838 


 14.  While  no  commenter  specifically  addressed  the  effect  of  time  limits  on  small  businesses,  several  entities  discussed  time  limits  for  the  established  business  relationship  rule  in 
 general.  839  DMA  indicated  the  difficulty  in  establishing  a  clock  that  will  apply  across  all  the  industries  that  use  the  phone  to  relate  to  their  customers.  840  DMA  continued  by  stating 
 [  d]  ifferent  business  models  require  different  periods  of  time.  841  This  concept  was  supported  by  Nextel,  the  FTCs  eighteen-  month  limit  on  its  EBR  rule  would  be  inappropriate  for  the 
 telecommunications  industry  and  would  dramatically  increase  administrative  burdens  and  costs  for  all  businesses  as  they  would  be  forced  to  monitor  and  record  every  customer  inquiry 
 and  purchasing  pattern  to  ensure  compliance  with  the  FCCs  rules.  842 
 15.  Unsolicited  Facsimile  Advertising  and  War  Dialing.  Privacy  Rights  commented  that  the  practice  of  dialing  large  blocks  of  numbers  to  identify  facsimile  lines,  i.  e., 


 war  dialing,  should  be  prohibited,  especially  because  such  calls  cannot  be  characterized  as  telemarketing.  843  It  argued  that  this  practice  is  particularly  troubling  for  small  business  owners 
 who  often  work  out  of  home  offices  because  it  deprives  the  small  business  owner  of  the  use  of  the  equipment,  creates  an  annoyance  and  interrupts  business  calls.  844 


 16.  NFIB  advocated  on  behalf  of  its  small  business  members  that  the  ability  to  fax  information  to  their  established  customers  is  an  essential  commercial  tool.  845  Any  customer 
 835  NFIB  Comments  at  2. 
 836  NADA  Comments  at  2. 
 837  NADA  Comments  at  2. 
 838  NADA  Comments  at  2. 
 839  See,  e.  g.,  NASUCA  Comments  at  17-  18;  DMA  Comments  at  20-  21;  Nextel  Reply  Comments  at  11-  13. 
 840  DMA  Comments  at  20. 
 841  DMA  Comments  at  20. 
 842  Nextel  Reply  Comments  12-  13. 
 843  Privacy  Rights  Comments  at  4-  5. 
 844  Privacy  Rights  Comments  at  4-  5. 
 845  NFIB  Comments  at  3-  4.  See  also,  NADA  Comments  at  2-  3. 
142

 Federal  Communications  Commission  FCC  03-  153 
 143 
 who  provides  contact  information  when  patronizing  a  business  is  providing  express  permission  to  be  contacted  by  that  business,  including  via  facsimile  advertising.  846  In  addition,  NFIB 
 indicated  that  businesses  engaged  in  facsimile  advertising  should  not  be  required  to  identify  themselves,  and  that  customers  should  be  required  to  notify  the  business  that  they  do  not  wish  to 
 receive  such  faxes.  847  NADA  agreed  that  the  Commission  should  preserve  its  determination  that  a  prior  business  relationship  between  a  fax  sender  and  recipient  establishes  the  requisite 
 consent  to  receive  fax  advertisements.  848  According  to  NADA,  changing  these  rules  would  deprive  small  businesses  of  a  marketing  tool  upon  which  they  have  come  to  rely.  849 


 17.  Other  commenters  disagreed,  explaining  that  numerous  small  businesses  are  burdened  by  the  intrusion  of  ringing  telephones  and  fax  machines,  850  the  receipt  of 
 advertisements  in  which  they  are  not  interested,  851  the  depletion  of  toner  and  paper,  852  and  the  time  spent  dealing  with  these  unwanted  faxes.  853  A  few  home-  based  businesses  and  other 
 companies  maintain  that  facsimile  advertisements  interfere  with  the  receipt  of  faxes  connected  to  their  own  business,  and  that  the  time  spent  collecting  and  sorting  these  faxes  increases  their  labor 
 costs.  854  In  fact,  NFIB  has  received  complaints  from  its  own  members  who  .  .  .  failed  to  realize  that  their  membership  entitles  them  to  the  receipt  of  such  information  via  fax.  855 


 18.  Caller  ID  Requirements.  In  response  to  the  Commissions  proposal  to  require  telemarketers  to  transmit  caller  ID  or  prohibit  the  blocking  of  such  information,  NYSCPB 
 favored  prohibiting  the  intentional  blocking  of  caller  ID  information,  but  acknowledged  that  requiring  the  transmission  of  caller  ID  may  be  inappropriate  for  smaller  firms.  856  NYSCPB 


 846  NFIB  Comments  at  3-  4. 
 847  NFIB  Comments  at  3-  4.  But  see,  Mathemaesthetics  Comments  at  2-  5. 
 848  NADA  Comments  at  2. 
 849  NADA  Comments  at  2. 
 850  Mathemaesthetics  Comments  at  2. 
 851  Jeff  Bryson  Comments;  Carolyn  Capps  Comments  at  2. 
 852  Michael  C.  Addison  Comments. 
 853  John  Holcomb  Comments  at  1. 
 854  Jim  Carter  Comments;  JC  Homola  Comments;  Autoflex  Comments  at  1-  2;  Rob  McNeal  Comments 
 (unsolicited  faxes  costs  company  tens  of  thousands  of  dollars  each  year  in  materials  and  employee  time);  see  also  NCL  Comments  at  6  ([  P]  eople  who  work  out  of  their  homes  are  especially  harmed  by  unsolicited  faxes,  which 


 use  up  their  paper  and  toner  and  tie  up  their  machines.);  Mathemaesthetics  Reply  Comments  at  7  ([  U]  nsolicited  [fax]  ads  caused  my  business  fax  machine  to  become  prematurely  empty,  which  rendered  wholly  useless  the 
 equipment  my  small  business  crucially  depends  on  for  its  revenue.  When  a  customer  of  mine  a  short  time  later  attempted  to  fax  a  purchase  order  for  over  $3,000  worth  of  my  companys  product,  my  empty  fax  machine  was 
 not  able  to  capture  this  transaction  for  a  significant  period  of  time    .  (emphasis  in  original)). 
 855  NFIB  Comments  at  2  (emphasis  added). 


 856  NYSCPB-  Other  Than  National  DNC  List  Comments  at  9-  10. 
143

 Federal  Communications  Commission  FCC  03-  153 
 144 
 stated  that  [  w]  hile  mandatory  transmission  of  caller  ID  information  would  undoubtedly  facilitate  do-  not-  call  enforcement  .  .  .  we  would  not  want  to  impose  onerous  burdens  on  smaller, 
 less  technically  sophisticated  firms  .  .  .  .  857  In  addition,  NYSCPB  suggested  that  smaller  businesses  that  lack  the  capability  to  transmit  caller  ID  be  exempt  from  providing  caller  ID 
 information  until  the  business  installs  new  equipment  with  caller  ID  capabilities.  858 
 C.  Description  and  Estimate  of  the  Number  of  Small  Entities  to  Which  the  Rules  Will  Apply 


 19.  The  RFA  directs  agencies  to  provide  a  description  of,  and  where  feasible,  an  estimate  of  the  number  of  small  entities  that  may  be  affected  by  the  rules  adopted  herein.  859  The 
 RFA  generally  defines  the  term  small  entity  as  having  the  same  meaning  as  the  terms  small  business,  small  organization,  and  small  governmental  jurisdiction.  860  In  addition,  the  term 
 small  business  has  the  same  meaning  as  the  term  small  business  concern  under  the  Small  Business  Act.  861  Under  the  Small  Business  Act,  a  small  business  concern  is  one  that:  1)  is 
 independently  owned  and  operated;  2)  is  not  dominant  in  its  field  of  operation;  and  3)  satisfies  any  additional  criteria  established  by  the  Small  Business  Administration  (SBA).  862 


 20.  The  Commissions  rules  on  telephone  solicitation  and  the  use  of  autodialers,  artificial  or  prerecorded  messages  and  telephone  facsimile  machines  apply  to  a  wide  range  of 
 entities,  including  all  entities  that  use  the  telephone  or  facsimile  machine  to  advertise.  863  That  is,  our  action  affects  the  myriad  of  businesses  throughout  the  nation  that  use  telemarketing  to 
 advertise.  For  instance,  funeral  homes,  mortgage  brokers,  automobile  dealers,  newspapers  and  telecommunications  companies  could  all  be  affected.  Thus,  we  expect  that  the  rules  adopted  in 
 this  proceeding  could  have  a  significant  economic  impact  on  a  substantial  number  of  small  entities. 


 21.  Nationwide,  there  are  a  total  of  22.4  million  small  businesses,  according  to  SBA  data.  864  And,  as  of  1992,  nationwide  there  were  approximately  275,801  small  organizations  [not- 


 857  NYSCPB-  Other  Than  National  DNC  List  Comments  at  9. 
 858  NYSCPB-  Other  Than  National  DNC  List  Comments  at  10. 
 859  5  U.  S.  C.    604(  a)(  3). 
 860  5  U.  S.  C.    601(  6). 
 861  5  U.  S.  C.    601(  3)  (incorporating  by  reference  the  definition  of  small-  business  concern  in  the  Small  Business 
 Act,  15  U.  S.  C.    632).  Pursuant  to  5  U.  S.  C.    601(  3),  the  statutory  definition  of  a  small  business  applies  unless  an  agency,  after  consultation  with  the  Office  of  Advocacy  of  the  Small  Business  Administration  and  after 


 opportunity  for  public  comments,  establishes  one  or  more  definitions  of  such  term  which  are  appropriate  to  the  activities  of  the  agency  and  publishes  such  definition(  s)  in  the  Federal  Register. 


 862  15  U.  S.  C.    632. 
 863  47  C.  F.  R.    64.1200. 
 864  See  SBA,  Programs  and  Services,  SBA  Pamphlet  No.  CO-  0028,  at  page  40  (July  2002). 
144

 Federal  Communications  Commission  FCC  03-  153 
 145 
 for-  profit].  865 
 22.  Again,  we  note  that  our  action  affects  an  exhaustive  list  of  business  types  and  varieties.  We  will  mention  with  particularity  the  intermediary  groups  that  engage  in  this  activity. 


 SBA  has  determined  that  telemarketing  bureaus  with  $6  million  or  less  in  annual  receipts  qualify  as  small  businesses.  866  For  1997,  there  were  1,727  firms  in  the  telemarketing  bureau 
 category,  total,  which  operated  for  the  entire  year.  867  Of  this  total,  1,536  reported  annual  receipts  of  less  than  $5  million,  and  an  additional  77  reported  receipts  of  $5  million  to  $9,999,999. 
 Therefore,  the  majority  of  such  firms  can  be  considered  to  be  small  businesses. 
 D.  Description  of  Projected  Reporting,  Recordkeeping,  and  Other  Compliance  Requirements  for  Small  Entities 


 23.  The  rules  contained  herein  require  significant  recordkeeping  requirements  on  the  part  of  businesses,  including  small  business  entities.  First,  while  the  national  do-  not-  call  list  will 
 be  developed  and  maintained  by  the  FTC,  all  businesses  that  engage  in  telemarketing  will  be  responsible  for  obtaining  the  list  of  telephone  numbers  on  the  national  do-  not-  call  list  and 
 scrubbing  their  calling  lists  to  avoid  calling  those  numbers.  868  They  must  also  continue  to  be  responsible  for  maintaining  their  own  company-  specific  do-  not-  call  lists;  however,  this  is  not  a 
 new  requirement,  but  a  continuation  of  the  Commissions  existing  rules.  The  Commission  has  reduced  the  period  of  time  that  businesses  must  retain  company-  specific  do-  not-  call  requests 
 from  10  years  to  five  years.  In  addition,  for  those  businesses,  including  small  businesses,  that  wish  to  call  consumers  under  the  established  business  relationship  exemption,  they  must 
 continue  to  maintain  customer  lists  in  the  normal  course  of  business.  Because  of  the  time  limits  associated  with  this  rule,  businesses  will  need  to  monitor  and  record  consumer  contacts  to  assure 
 that  they  are  complying  with  the  18-  month  and  three-  month  provisions  in  the  rule.  Businesses  that  want  to  call  consumers  with  whom  they  have  no  relationship,  but  who  are  listed  on  the 
 national  do-  not-  call  list,  must  obtain  a  consumers  express  permission  to  call.  This  permission  must  be  evidenced  by  a  signed,  written  agreement. 


 24.  Second,  all  businesses  that  use  autodialers,  including  predictive  dialers,  to  sell  goods  or  services,  will  be  required  to  maintain  records  documenting  compliance  with  the  call 
 abandonment  rules.  869  Such  records  should  demonstrate  the  telemarketers  compliance  with  a  call  abandonment  rate  of  no  less  than  three  percent  measured  over  a  30-  day  period,  with  the  two-second- 
 transfer  rule,  and  with  the  ring  duration  requirement. 


 865  1992  Economic  Census,  U.  S.  Bureau  of  the  Census,  Table  6  (special  tabulation  of  data  under  contract  to  Office 
 of  Advocacy  of  the  U.  S.  Small  Business  Administration). 
 866  See  13  C.  F.  R.    121.201,  NAICS  code  561422. 


 867  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Administrative  and  Support  and  Waste 
 Management  and  Remediation  Services,  Receipts  Size  of  Firms  Subject  to  Federal  Income  Tax:  1997,  Table  4,  NAICS  code  561422  (issued  Oct.  2000). 


 868  Order,  paras  16-  85. 
 869  Order,  paras.  129-  134,  146-  159. 
145

 Federal  Communications  Commission  FCC  03-  153 
 146 
 25.  Third,  with  the  exception  of  tax-  exempt  nonprofit  organizations,  all  businesses  that  engage  in  telemarketing  will  be  required  to  transmit  caller  ID  information.  870 
 26.  Fourth,  businesses  that  advertise  by  fax  will  be  required  to  maintain  records  demonstrating  that  recipients  have  provided  express  permission  to  send  fax  advertisements. 
 Such  permission  must  be  given  in  writing,  and  businesses  must  document  that  they  have  obtained  the  required  permission.  871 


 E.  Steps  Taken  to  Minimize  the  Significant  Economic  Impact  on  Small  Entities,  and  Significant  Alternatives  Considered 
 27.  The  RFA  requires  an  agency  to  describe  any  significant  alternatives  that  it  has  considered  in  developing  its  approach,  which  may  include  the  following  four  alternatives 
 (among  others):  (  1)  the  establishment  of  differing  compliance  or  reporting  requirements  or  timetables  that  take  into  account  the  resources  available  to  small  entities;  (2)  the  clarification, 
 consolidation,  or  simplification  of  compliance  or  reporting  requirements  under  the  rule  for  such  small  entities;  (3)  the  use  of  performance  rather  than  design  standards;  and  (4)  an  exemption 
 from  coverage  of  the  rule,  or  any  part  thereof,  for  such  small  entities.  872 
 28.  There  were  five  specific  areas  in  which  the  Commission  considered  alternatives  for  small  businesses.  These  areas  were:  (1)  establishing  a  National  Do-  Not-  Call  List  ((  a) 


 providing  a  portion  of  the  national  do-  not-  call  list  (five  area  codes)  for  free,  (b)  providing  businesses  with  30  days  to  process  do-  not-  call  requests,  and  (c)  reducing  the  do-  not-  call  record 
 retention  rate  from  10  years  to  five  years);  (2)  maintaining  the  current  established  business  rule  exemption  and  adopting  the  FTCs  time  limits  of  18  months  and  three  months;  (3)  establishing  a 
 call  abandonment  rate  of  three  percent,  rather  than  zero  percent,  and  measuring  the  rate  over  a  30-  day  period,  rather  than  on  a  per  day  basis;  (4)  continuing  to  prohibit  facsimile  advertising  to 
 residential  and  business  numbers;  and  (5)  declining  to  require  businesses  to  maintain  a  website  or  toll-  free  number  for  do-  not-  call  requests  or  confirmation  of  such  requests  by  consumers.  As 
 mentioned,  supra,  in  Section  B  of  the  FRFA,  small  businesses  presented  arguments  on  both  sides  of  each  of  these  issues. 


 29.  National  Do-  Not-  Call  List.  This  Order  establishes  a  national  do-  not-  call  list  for  those  residential  telephone  subscribers  who  wish  to  avoid  most  unwanted  telephone 
 solicitations.  873  Although  many  businesses,  including  small  businesses,  objected  to  a  national  do-  not-  call  registry,  874  the  Commission  determined  that  a  national  do-  not-  call  list  was  necessary 
 to  carry  out  the  directives  in  the  TCPA.  We  agreed  with  those  commenters  who  maintained  that  the  company-  specific  approach  to  concerns  about  unwanted  telephone  solicitations  does  not 


 870  Order,  paras.  173-  184. 
 871  Order,  paras.  185-  203. 
 872  5  U.  S.  C.    603(  c)(  1)-(  c)(  4). 
 873  Order,  paras.  25-  41. 
 874  See  e.  g.,  MBNA  Comments  at  4. 
146

 Federal  Communications  Commission  FCC  03-  153 
 147 
 alone  adequately  protect  individuals  privacy  interests.  875  We  declined  to  exempt  local  solicitations  and  small  businesses  from  the  national  do-  not-  call  list.  876  Given  the  numerous 
 entities  that  solicit  by  telephone,  and  the  technological  tools  that  allow  even  small  entities  to  make  a  significant  number  of  solicitation  calls,  we  believe  that  to  do  so  would  undermine  the 
 effectiveness  of  the  national  do-  not-  call  rules  in  protecting  consumer  privacy.  In  addition,  we  declined  to  permit  businesses  to  register  their  numbers  on  the  national  do-  not-  call  registry, 
 despite  the  requests  of  numerous  small  business  owners  to  do  so.  877  The  TCPA  expressly  contemplates  that  a  national  do-  not-  call  database  includes  residential  telephone  subscribers 
 numbers.  Although  business  numbers  will  not  be  included  in  the  national  do-  not-  call  database,  a  business  could  nevertheless  request  that  its  number  be  added  to  a  companys  do-  not-  call  list. 


 30.  The  Commission  considered  the  costs  to  small  businesses  of  purchasing  the  national  do-  not-  call  list.  In  an  attempt  to  minimize  the  cost  for  small  businesses,  we  have 
 considered  an  alternative  and  determined  that  businesses  will  be  allowed  to  obtain  up  to  five  area  codes  free  of  charge.  878  Since  many  small  businesses  telemarket  within  a  local  area,  providing 
 five  area  codes  at  no  cost  should  help  to  reduce  or  eliminate  the  costs  of  purchasing  the  national  registry  for  small  businesses.  879  Furthermore,  as  suggested  by  NCS,  small  businesses  should  be 
 able  to  gain  access  to  the  national  list  in  an  efficient,  cost-  effective  manner  via  the  Internet.  880 
 31.  As  discussed  extensively  in  the  Order,  many  businesses,  including  small  business  entities,  requested  specific  exemptions  from  the  requirements  of  a  national  do-  not-  call  list.  881  In 


 order  to  minimize  potential  confusion  for  both  consumers  and  businesses  alike,  we  declined  to  create  specific  exemptions  for  small  businesses.  882  We  believe  the  exemptions  adopted  for  calls 
 made  to  consumers  with  whom  a  seller  has  an  established  business  relationship  and  those  that  have  provided  express  agreement  to  be  called  provide  businesses  with  a  reasonable  opportunity 
 to  conduct  their  business  while  protecting  consumer  privacy  interests. 
 32.  The  Commission  also  considered  modifying  for  small  businesses  the  time  frames  for  (1)  processing  consumers  do-  not-  call  requests;  (2)  retaining  consumer  do-  not-  call  records; 


 and  (3)  scrubbing  calling  lists  against  the  national  do-  not-  call  registry.  In  doing  so,  we 


 875  See  e.  g.,  Privacy  Rights  Comments  at  2. 
 876  Order,  paras.  46-  49,  54. 
 877  See  e.  g.,  Mathemaesthetics  Comments  at  6. 
 878  Order,  para.  54. 
 879  See  e.  g.,  MBA  Reply  at  3;  NAA  Comments  at  3;  SBSC  Comments  at  2;  PLP  Comments  at  5. 
 880  NCS  Comments  at  4-  5. 
 881  See  e.  g.,  NAA  Comments  at  12-  14  (exempt  newspapers);  NAIFA  Comments  at  3  (exempt  referral  calls);  SBSC 
 Comments  at  2  (exempt  local  calls);  MBA  Comments  at  5  (exempt  calls  to  set  up  face-  to-  face  meetings). 
 882  Order,  paras.  46-  54. 
147

 Federal  Communications  Commission  FCC  03-  153 
 148 
 recognized  the  limitations  on  small  businesses  of  processing  requests  in  a  timely  manner.  883  Therefore,  we  determined  to  require  that  both  large  and  small  businesses  must  honor  do-  not-  call 
 requests  within  30  days  from  the  date  such  a  request  is  made,  instead  of  requiring  that  businesses  honor  requests  in  less  time.  884  Although  some  commenters  suggested  periods  of  up  to  60  to  90 
 days  to  process  do-  not-  call  requests,  we  determined  that  such  an  inconsistency  in  the  rules  would  lead  to  confusion  for  consumers.  Consumers  might  not  easily  recognize  that  the  telemarketer 
 calling  represented  a  small  business  and  that  they  must  then  allow  a  longer  period  of  time  for  their  do-  not-  call  requests  to  be  processed. 


 33.  The  Commission  also  determined  to  reduce  the  retention  period  of  do-  not-  call  records  from  10  years  to  five  years.  885  This  modification  should  benefit  businesses  that  are 
 concerned  about  telephone  numbers  that  change  hands  over  time.  They  argue  that  a  shorter  retention  requirement  will  result  in  do-  not-  call  lists  that  more  accurately  reflect  those  consumers 
 who  have  requested  not  to  be  called.  Finally,  we  considered  allowing  small  businesses  additional  time  to  scrub  their  customer  call  lists  against  the  national  do-  not-  call  database.  The 
 FTCs  rules  require  telemarketers  to  scrub  their  lists  every  90  days.  For  the  sake  of  consistency,  and  to  avoid  confusion  on  the  part  of  consumers  and  businesses,  the  Commission  determined  to 
 require  all  businesses  to  access  the  national  registry  and  scrub  their  calling  lists  of  numbers  in  the  registry  every  90  days. 


 34.  Established  Business  Relationship.  We  have  modified  the  current  definition  of  established  business  relationship  886  so  that  it  is  limited  in  duration  to  18  months  from  any 
 purchase  or  transaction  and  three  months  from  any  inquiry  or  application.  The  revised  definition  is  consistent  with  the  definition  adopted  by  the  FTC.  887  We  concluded  that  regulating  the 
 duration  of  an  established  business  relationship  is  necessary  to  minimize  confusion  and  frustration  for  consumers  who  receive  calls  from  companies  they  have  not  contacted  or 
 patronized  for  many  years.  There  was  little  consensus  among  industry  members  about  how  long  an  established  business  relationship  should  last  following  a  transaction  between  the  consumer 
 and  seller.  888  We  believe  the  18-  month  timeframe  strikes  an  appropriate  balance  between  industry  practices  and  consumer  privacy  interests.  Although  businesses,  including  small 
 businesses  must  monitor  the  length  of  relationships  with  their  customers  to  determine  whether  they  can  lawfully  call  a  customer,  we  believe  that  a  rule  consistent  with  the  FTCs  will  benefit 
 businesses  by  creating  one  uniform  standard  with  which  businesses  must  comply. 
 35.  Call  Abandonment.  In  the  2002  Notice,  the  Commission  requested  information 
 883  Order,  para.  94. 
 884  Order,  para.  94. 
 885  Order,  para.  92. 
 886  Order,  para.  113. 
 887  See  FTC  Order,  68  Fed.  Reg.  4580  at  4591-  94. 
 888  See,  e.  g.,  Bank  of  America  Comments  at  4  (36  months);  MPA  Comments  at  12-  13  (24  months);  Sprint 
 Comments  at  18  (12  months). 
148

 Federal  Communications  Commission  FCC  03-  153 
 149 
 on  the  use  of  predictive  dialers  and  the  harms  that  result  when  predictive  dialers  abandon  calls.  889  In  response,  some  small  businesses  urged  the  Commission  to  adopt  a  maximum  rate  of  zero  on 
 abandoned  calls.  They  described  their  frustration  over  hang-  up  calls  that  interrupt  their  work  and  with  answering  the  phone  only  to  find  complete  silence  on  the  other  end.  890  Most  industry 
 members  encouraged  the  Commission  to  adopt  an  abandonment  rate  of  no  less  than  five  percent,  claiming  that  this  rate  minimizes  abandoned  calls,  while  still  allowing  for  the  substantial 
 benefits  achieved  by  predictive  dialers.  891  The  Commission  has  determined  that  a  three  percent  maximum  rate  on  abandoned  calls  balances  the  interests  of  businesses  that  derive  economic 
 benefits  from  predictive  dialers  and  consumers  who  find  intrusive  those  calls  delivered  by  predictive  dialers.  892  We  believe  that  this  alternative,  a  rate  of  three  percent,  will  also  benefit 
 small  businesses  that  are  affected  by  interruptions  from  hang-  ups  and  dead  air  calls. 
 36.  The  three  percent  rate  will  be  measured  over  a  30-  day  period,  rather  than  on  a  per  day  basis.  Industry  members  maintained  that  a  per  day  measurement  would  not  account  for 


 short-  term  fluctuations  in  marketing  campaigns  893  and  may  be  overly  burdensome  to  smaller  telemarketers.  We  believe  that  measuring  the  three  percent  rate  over  a  longer  period  of  time  will 
 still  reduce  the  overall  number  of  abandoned  calls,  yet  permit  telemarketers  to  manage  individual  calling  campaigns  effectively.  It  will  also  permit  telemarketers  to  more  easily  comply  with  the 
 recordkeeping  requirements  associated  with  the  use  of  predictive  dialers. 
 37.  Unsolicited  Facsimile  Advertising.  The  record  reveals  that  facsimile  advertising  can  both  benefit  and  harm  small  businesses  with  limited  resources.  The  small  businesses  and 


 organizations  that  rely  upon  faxing  as  a  cost-  effective  way  to  advertise  insist  that  the  Commission  allow  facsimile  advertising  to  continue.  894  Other  small  businesses  contend  that 
 facsimile  advertising  interferes  with  their  daily  operations,  increases  labor  costs,  and  wastes  resources  such  as  paper  and  toner.  895  The  Commission  has  reversed  its  prior  conclusion  that  an 
 established  business  relationship  provides  companies  with  the  necessary  express  permission  to  send  faxes  to  their  customers.  896  Under  the  amended  rules,  a  business  may  advertise  by  fax  with 
 the  prior  express  permission  of  the  fax  recipient,  which  must  be  in  writing.  897  Businesses  may  obtain  such  written  permission  through  direct  mail,  websites,  or  during  interaction  with 
 customers  in  their  stores.  This  alternative  will  benefit  those  small  businesses,  which  are 
 889  2002  Notice,  17  FCC  Rcd  at  17475-  76,  para.  26. 
 890  Mathemaesthetics  Comments  at  6. 
 891  WorldCom  Reply  at  18-  19. 
 892  Order,  paras.  150-  152. 
 893  See,  e.  g.,  WorldCom  Further  Comments  at  8;  Teleperformance  Further  Comments  at  4. 
 894  NFIB  Comments  at  3-  4. 
 895  John  Holcomb  Comments  at  1;  Mathemaesthetics  Comments  at  2-  3. 
 896  Order,  para.  189. 
 897  Order,  para.  191. 
149

 Federal  Communications  Commission  FCC  03-  153 
 150 
 inundated  with  unwanted  fax  advertisements. 
 38.  Website  or  Toll-  Free  Number  to  Access  Company-  Specific  Lists  and  to  Confirm  Requests.  Lastly,  the  Commission  has  determined  not  to  require  businesses  to  provide  a  website 


 or  toll-  free  number  for  consumers  to  request  placement  on  company-  specific  do-  not-  call  lists  or  to  respond  affirmatively  to  do-  not-  call  requests  or  otherwise  provide  some  means  of 
 confirmation  that  consumers  have  been  added  to  a  companys  do-  not-  call  list.  898  Several  commenters  indicated  that  such  requirements  would  be  costly  to  small  businesses.  899  Although 
 we  believe  these  measures  would  improve  the  ability  of  consumers  to  register  do-  not-  call  requests,  we  agree  that  such  requirements  would  be  potentially  costly  to  businesses,  particularly 
 small  businesses.  Instead,  we  believe  that  the  national  do-  not-  call  registry  will  provide  consumers  with  a  viable  alternative  if  they  are  concerned  that  their  company-  specific  do-  not-  call 
 requests  are  not  being  honored.  In  addition,  consumers  may  pursue  a  private  right  of  action  if  there  is  a  violation  of  the  do-  not-  call  rules.  This  alternative  should  reduce,  for  small  businesses 
 who  engage  in  telemarketing,  both  the  potential  cost  and  resource  burdens  of  maintaining  company-  specific  lists. 


 39.  REPORT  TO  CONGRESS:  The  Commission  will  send  a  copy  of  the  Order,  including  this  FRFA,  in  a  report  to  be  sent  to  Congress  pursuant  to  the  Congressional  Review 
 Act.  900  In  addition,  the  Commission  will  send  a  copy  of  the  Order,  including  this  FRFA,  to  the  Chief  Counsel  for  Advocacy  of  the  SBA.  A  copy  of  the  Order  and  FRFA  (or  summaries  thereof) 
 will  also  be  published  in  the  Federal  Register.  901 


 898  Order,  para.  93. 
 899  MBA  Comments  at  6-  7. 
 900  See  5  U.  S.  C.    801(  a)(  1)(  A). 
 901  See  5  U.  S.  C.    604(  b). 
150

 Federal  Communications  Commission  FCC  03-  153 
 151 
 Appendix  C 
 Comments  Filed 


 Due  to  the  significant  number  of  comments  filed  by  individual  consumers  in  this  proceeding,  we  have  listed  below  only  those  comments  received  from  industry,  consumer  advocacy  groups  and 
 governmental  entities.  All  individual  consumer  comments,  including  those  cited  in  the  Report  and  Order,  are  available  for  inspection  on  the  Commissions  Electronic  Comment  Filing  System 
 (ECFS). 


 ACI  Telecentrics  Incorporated  (5-  2-  03)  ACI  Allstate  Life  Insurance  Company  (Lisa  Behzad;  12-  9-  02)  Allstate 
 Americall  Group,  Inc.  (11-  26-  02)  Americall  American  Association  of  Blood  Banks  (Marlene  H.  Dortch;  12-  6-  02)  AABB 
 American  Association  of  Retired  Persons  (AARP;  1-  31-  03)  AARP  American  Bankers  Association  (12-  9-  02)  ABA 
 American  Business  Media  (11-  22-  02)  ABM  American  Express  Company  (12-  5-  02)  American  Express 
 American  General  Finance,  Inc.  (12-  10-  02)  AGF  American  Insurance  Association  (11-  21-  02)  AIA 
 American  International  Automobile  Dealers  Association  (12-  9-  02)  AIADA  American  Red  Cross  (12-  9-  02)  Red  Cross 
 American  Resort  Development  Association  (11-  15-  02)  ARDA  American  Teleservices  Association  (12-  9-  02)  (12-  23-  02)  ATA 
 Americas  Blood  Centers  (Jeanne  Dariotis;  12-  5-  02)  ABC  Ameriquest  Mortgage  Company  (12-  9-  02)  Ameriquest 
 Association  for  Communications  Technology  Professionals  in  Higher  Education  (ACUTA,  Inc.)  and  Association  of  College 
 and  University  Housing  Officers-  International  (ACUHO-  I)  (ACUTA  and  ACUHO-  I;  12-  9-  02)  ACUTA 
 Association  for  Competitive  Technology  (12-  9-  02)  ACT  Association  of  Fundraising  Professionals  (11-  27-  02)  AFP 
 AT&  T  Wireless  Services,  Inc.  (12-  9-  02)  AT&  T  Wireless  Autoflex  Leasing  (11-  18-  02)  Autoflex 
 Avinta  Communications,  Inc.  (Abraham  Y.  Chen;  11-  18-  02)  Avinta  Bank  of  America  (12-  3-  02)  Bank  of  America 
 BellSouth  Corporation  (12-  9-  02)  BellSouth  Blocklist.  com  (12-  9-  02)  Blocklist.  com 
 BMO  Financial  Group  (12-  9-  02)  BMO  Financial  The  Broadcast  Team  (12-  6-  02)  TBT 
 Brunswick  Corporation  (12-  9-  02)  Brunswick  Californians  Against  Telephone  Solicitation  (Robert  Arkow;  12-  9-  02)  CATS 
 Call  Compliance,  Inc.  (12-  9-  02)  Call  Compliance  Castel,  Inc.  (2-  28-  03)  Castel 
 Cellular  Telecommunications  &  Internet  Association  (12-  9-  02)  CTIA  Cendant  Corporation  (11-  22-  02)  Cendant 
151

 Federal  Communications  Commission  FCC  03-  153 
 152 
 Center  for  Democracy  &  Technology  (12-  9-  02)  CDT  Cherry  Communications  (11-  21-  02)  Cherry 
 Cingular  Wireless  LLC  (12-  9-  02)  Cingular  Citigroup,  Inc.  (12-  12-  02)  Citigroup 
 City  of  Chicago  (11-  22-  02)  City  of  Chicago  CMOR  (12-  9-  02)  CMOR 
 CNN.  com  (4-  22-  03)  CNN  Colorado  Public  Utilities  Commission  (12-  3-  02)  CO  PUC 
 Comcast  Cable  Communications,  Inc.  (12-  9-  02)  Comcast  Concerned  Telephone  Companies  (12-  9-  02)  CTC 
 Consumer  Bankers  Association  (12-  9-  02)  CBA  Consumer  Choice  Coalition  (12-  2-  02)  Coalition 
 Consumer  Disability  Telecommunications  Advisory  Committee  (12-  24-  02)  CDTAC 
 Consumer  Mortgage  Coalition  (12-  19-  02)  CMC  Convergys  Corporation  (12-  9-  02)  Convergys 
 Copilevitz  and  Canter,  LLC  (William  E.  Raney;  12-  9-  02)  Copilevitz  &  Canter  Cox  Enterprises,  Inc.  (12-  9-  02)  Cox 
 DialAmerica  Marketing,  Inc.  (12-  10-  02)  DialAmerica  Direct  Marketing  Association  (12-  9-  02)  DMA 
 Direct  Selling  Association  (12-  9-  02)  DSA  DIRECTV,  Inc.  (12-  9-  02)  DIRECTV 
 Discover  Bank  (12-  9-  02)  Discover  Electronic  Privacy  Information  Center;  Consumer  Task  Force  for 
 Automotive  Issues;  Remar  Sutton;  Consumer  Action;  Privacy  Rights  Clearinghouse;  Consumer  Federation  of  America; 
 International  Union,  UAW;  Free  Congress  Foundation;  Junkbusters  Corp.;  Consumer  Project  on  Technology;  Computer  Professionals 
 for  Social  Responsibility;  and  Private  Citizens,  Inc.  (12-  9-  02)  EPIC  Electronic  Retailing  Association  (12-  9-  02)  ERA 
 Emergency  Communications  Network,  Inc.  (12-  6-  02)  ECN  Farmers  Insurance  Group  (11-  22-  02)  Farmers 
 Financial  Services  Roundtable  (12-  12-  02)  FSR  Florida  Department  of  Agriculture  and  Consumer  Services  (1-  8-  03)  FL  DACS 
 Fund  for  Public  Interest  Research,  Inc.  (Jon  Scarlett;  12-  6-  02)  Fund  for  Public  Interest  Globecomm  Systems,  Inc.  (12-  9-  02)  Globecomm 
 Hilton  Head  Hospitality  Resort  Services  (1-  31-  03)  Hilton  Head  Household  Automotive  Finance  Corporation;  OFL-  A  Receivables 
 Corp.;  and  Household  Automotive  Credit  Corporation  (12-  9-  02)  Household  Automotive  Household  Bank  (SB),  N.  A.  (12-  9-  02)  Household  Bank 
 Household  Finance  Corp.  (House  Hold  Finance  Corporation;  12-  12-  02)  Household  Finance  Household  Financial  Services,  Inc.  (12-  10-  02)  HFS 
 Hunton  &  Williams  (11-  22-  02)  Hunton  &  Williams  IBM  Corporate  Market  Intelligence  (2-  4-  03)  IBM 
 Intellidyn  Corporation  (Kathie  Fleischer;  12-  4-  02)  Intellidyn  Interactive  Teleservices  Corporation  (Barbara  Bricker;  4-  10-  03) 
 (Duane  L.  Billingslea;  4-  11-  03)  ITC 
152

 Federal  Communications  Commission  FCC  03-  153 
 153 
 Intrado  Inc.  (11-  22-  02)  Intrado  Intuit,  Inc.  (12-  9-  02)  Intuit 
 Katz  &  Korin  (Robert  J.  Schuckit;  10-  5-  02)  Katz  &  Korin  Kauffman  Group  Inc.  (11-  25-  02)  Kauffman 
 Kondos  &  Kondos  Law  Offices  (11-  14-  02)  Kondos  &  Kondos  LCC  International,  Inc.  (12-  9-  02)  LCC 
 The  Leukemia  &  Lymphoma  Society  (George  Dahlman;  1-  31-  03  and  5-  2-  03)  L&  LS 
 LSSi  Corp.  (12-  9-  02)  LSSi  Magazine  Publishers  of  America  (12-  9-  02)  MPA 
 March  of  Dimes  (11-  22-  02)  March  of  Dimes  MasterCard  International  Incorporated  (12-  9-  02)  Mastercard 
 Mathemaesthetics,  Inc.  (11-  22-  02)  (see  also  Douglas  M.  McKenna)  Mathemaesthetics  MBNA  America  Bank,  N.  A.  (12-  9-  02)  (Revised  12-  10-  02)  MBNA 
 Metris  Companies,  Inc.  (12-  6-  02)  Metris  Meyer  Associates,  Inc.  ([  Thoams]  Caprio;  4-  24-  03)  Meyer 
 MidFirst  Bank  (1-  9-  03)  MidFirst  Mortgage  Bankers  Association  of  America  (12-  9-  02)  MBA 
 Mortgage  Investors  Corporation,  Inc.  (12-  9-  02)  Mortgage  Investors  Mothers  Against  Drunk  Driving  (1-  30-  03)  (Wendy  J.  Hamilton;  5-  1-  03)  MADD 
 Moultrie  Independent  Telephone  Company  (12-  9-  02)  Moultrie  National  Association  of  Attorneys  General  (12-  9-  02)  NAAG 
 National  Association  of  Broadcasters  (12-  9-  02)  NAB  National  Association  of  Consumer  Agency  Administrators 
 (Kathleen  Thuner,  President;  11-  22-  02)  NACAA  National  Association  of  Independent  Insurers  (12-  10-  02)  NAII 
 National  Association  of  Insurance  &  Financial  Advisors  (11-  22-  02)  NAIFA  National  Association  of  Mortgage  Brokers  (12-  9-  02) 
 (see  also  Armand  Cosenza)  NAMB  National  Association  of  Regulatory  Utility  Commissioners  (11-  22-  02)  NARUC 
 National  Association  of  State  Utility  Consumer  Advocates  (NASUCA;  12-  9-  02)  NASUCA 
 National  Automobile  Dealers  Association  (12-  10-  02)  NADA  National  Cable  &  Telecommunications  Association  (12-  9-  02)  NCTA 
 National  Consumers  League  (12-  6-  02)  NCL  National  Energy  Marketers  Association  (11-  22-  02)  NEM 
 National  Federation  of  Independent  Business  (1-  9-  03)  NFIB  National  Public  Radio,  Inc.  (12-  9-  02)  NPR 
 National  Retail  Federation  (12-  9-  02)  NRF  National  Telecommunications  Cooperative  Association  (11-  22-  02)  NTCA 
 NCS  Pearson,  Inc.  (12-  9-  02)  NCS  NeuStar,  Inc.  (12-  9-  02)  NeuStar 
 New  Orleans,  Utility,  Cable  &  Telecommunications  Committee  of  the  City  Council  (11-  18-  02)  City  of  New  Orleans 
 Newsletter  &  Electronic  Publishers  Association  (12-  9-  02)  NEPA  Newspaper  Association  of  America  (12-  9-  02)  NAA 
 New  York  State  Consumer  Protection  Board  (11-  22-  02)  (3  comments)  NYSCPB 
153

 Federal  Communications  Commission  FCC  03-  153 
 154 
 Nextel  Communications,  Inc.  (12-  9-  02)  Nextel  Nielsen  Media  Research,  Inc.  (1-  31-  03)  Nielsen 
 North  Dakota  Public  Service  Commission  (12-  2-  02)  ND  PSC  Not-  For-  Profit  and  Charitable  Coalition  (11-  22-  02)  NPCC 
 Office  of  the  Peoples  Counsel  for  the  District  of  Columbia  (Elizabeth  A.  Noel;  12-  9-  02)  OPC-  DC 
 Ohio,  Public  Utilities  Commission  (12-  9-  02)  PUC  of  Ohio  Oregon  Telecommunications  Association  (12-  3-  02)  OTA 
 Pacesetter  Corporation  (11-  20-  02)  Pacesetter  Personal  Legal  Plans,  Inc.  (12-  16-  02)  PLP 
 Progressive  Casualty  Insurance  Company  (11-  18-  02)  Progressive  Casualty  Privacilla.  org  (12-  9-  02)  Privacilla.  org 
 Privacy  Rights  Clearinghouse  (Beth  Givens;  12-  5-  02)  PRC  Private  Citizen,  Inc.  (12-  9-  02)  Private  Citizen 
 Process  Handler  et  al.  For  Hire,  Inc.  (5-  14-  03)  Process  Handler  Progressive  Business  Publications  (Edward  M.  Satell;  4-  28-  03)  Progressive  Business 
 Qwest  Services  Corporation  (12-  9-  02)  Qwest  R  &  D  Lawn  &  Tree  Services  (11-  18-  02)  R  &  D 
 Reed  Elsevier,  Inc.  (12-  9-  02)  Reed  Reese  Brothers,  Inc.  (12-  9-  02)  Reese 
 Response  Catalyst  (Doug  Hibbeler;  12-  9-  02)  Response  Catalyst  Royal  Sonesta  Hotel  (4-  7-  03)  Royal  Sonesta 
 SBC  Communications,  Inc.  (12-  9-  02)  SBC  Scholastic,  Inc.  (12-  9-  02)  Scholastic 
 The  Seattle  Times  Company  (12-  9-  02)  Seattle  Times  SER  Solutions,  Inc.  (11-  19-  02)  SER 
 Small  Business  Survival  Committee  (1-  31-  03)  SBSC  Special  Olympics  Florida  (Laurie  Moyson;  5-  8-  03)  Special  Olympics  FL 
 Special  Olympics  Hawaii  (Nancy  Bottelo;  1-  30-  03)  Special  Olympics  HI  Special  Olympics  Kansas  (5-  1-  03)  Special  Olympics  KS 
 Special  Olympics  New  Jersey  (Suzanne  Schwanda;  1-  31-  03)  Special  Olympics  NJ  Special  Olympics  New  Mexico  (Randy  Mascorella;  4-  30-  03)  Special  Olympics  NM 
 Special  Olympics  New  York  (5-  2-  03)  Special  Olympics  NY  Special  Olympics  Ohio  (Federal  Communications  Commission;  1-  31-  03)  Special  Olympics  OH 
 Special  Olympics  Virginia  (5-  2-  03)  Special  Olympics  VA  Special  Olympics  Wisconsin  (Dennis  H.  Alldridge;  1-  30-  03)  Special  Olympics  WI 
 Sprint  (12-  9-  02)  Sprint  Student  Parent  Support  Services  Corp.  (3-  19-  03)  Student  Support 
 Suggs  &  Associates,  P.  C.  (James  [M.  Suggs];  12-  4-  02)  Suggs  Sytel  Limited  (12-  9-  02)  Sytel 
 Technion  Communications  Corp.  (11-  19-  02)  Technion  Telatron  Marketing  Group,  Inc.  (12-  9-  02)  Telatron 
 Telecommunications  for  the  Deaf  (11-  15-  02)  TDI  Teleperformance  USA  (Julie  Loppe-  Peyrin;  12-  6-  02) 
 (Timothy  J.  Casey;  12-  6-  02)  Teleperformance  Telestar  Marketing,  L.  P.  (11-  19-  02)  Telestar 
 Tennessee  Regulatory  Authority  and  the 
154

 Federal  Communications  Commission  FCC  03-  153 
 155 
 Tennesse  Attorney  General  (12-  9-  02)  TN  AG  Texas,  Office  of  Public  Utility  Counsel  (12-  9-  02)  TOPUC 
 Texas,  Public  Utility  Commission  (12-  3-  02)  Texas  PUC  TSI  Telecommunications  Services,  Inc.  (11-  7-  02)  TSI 
 U.  S.  Chamber  of  Commerce  (12-  26-  02)  Chamber  of  Commerce  Vector  Marketing  Corporation  (12-  9-  02)  Vector 
 Ver-  A-  Fast  (12-  10-  02)  (see  also  Bob  Bensman;  11-  19-  02)  Ver-  A-  Fast  VeriSign,  Inc.  (f/  n/  a  Illuminet,  Inc.)  (3-  31-  03)  VeriSign 
 Verizon  (12-  10-  02)  Verizon  Verizon  Wireless  (12-  9-  02)  Verizon  Wireless 
 Visa  U.  S.  A.  Inc.  (12-  9-  02)  Visa  Wells  Fargo  &  Company  (11-  5-  02)  Wells  Fargo 
 Winnebago  Cooperative  Telephone  Association  (1-  30-  03)  Winnebago  Worldcom,  Inc.  (12-  9-  02)  Worldcom 
 Xpedite  Systems,  Inc.  (12-  9-  02)  Xpedite  Yellow  Pages  Integrated  Media  Association  (12-  9-  02)  Yellow  Pages 
155

 Federal  Communications  Commission  FCC  03-  153 
 156 
 Reply  Comments  Filed 
 Adval  Communications,  Inc.  (1-  31-  03)  ADVAL  American  Teleservices  Association  (1-  31-  03)  (3-  5-  03,  correction)  ATA 
 Ameriquest  Mortgage  Company  (1-  31-  03)  Ameriquest  AT&  T  Wireless  Services,  Inc.  (1-  31-  03)  AT&  T  Wireless 
 BellSouth  Corporation  (1-  31-  03)  BellSouth  Cablevision  Systems  Corporation  (1-  31-  03)  Cablevision 
 Cavalier  Telephone,  LLC  (1-  31-  03)  Cavalier  CMOR  (1-  31-  03)  CMOR 
 Coontz,  J.  Greg  (1-  8-  03)  DialAmerica  Marketing,  Inc.  (1-  31-  03)  DialAmerica 
 Direct  Marketing  Association  (1-  31-  03)  DMA  DIRECTV,  Inc.  (1-  31-  03)  DIRECTV 
 Hershovitz,  Marc  B.,  Michael  Jablonski,  Ned  Blumenthal  and  C.  Ronald  Ellington  (1-  8-  03)  (3  comments)  Hershovitz 
 The  International  Softswitch  Consortium  (1-  31-  03)  ISC  Intuit,  Inc.  (1-  31-  03)  Intuit 
 LSSi  Corp.  (Lissi  Corp;  1-  31-  03)  LSSi  Mathemaesthetics,  Inc.  (1-  8-  03)  (see  also  Douglas  McKenna;  1-  6-  03)  Mathemaesthetics 
 MBNA  America  Bank,  N.  A.  (1-  31-  03)  MBNA  Mortgage  Bankers  Association  of  America 
 (Stephen  A.  OConner;  1-  31-  03)  MBA  National  Association  of  Broadcasters  (1-  31-  03)  NAB 
 National  Association  of  State  Utility  Consumer  Advocates  (NASUCA;  1-  31-  03)  NASUCA 
 National  Public  Radio,  Inc.  (1-  31-  03)  NPR  NCS  Pearson,  Inc.  (1-  31-  03)  NCS 
 The  Newspaper  Association  of  America  (1-  21-  03)  NAA  Nextel  Communications,  Inc.  (1-  31-  03)  Nextel 
 Office  of  the  Peoples  Counsel  for  the  District  of  Columbia  (Elizabeth  A.  Nol,  Peoples  Counsel;  1-  31-  03)  OPC-  DC 
 Private  Citizen,  Inc.  (1-  9-  03)  Private  Citizen  RoperASW  (1-  30-  03)  RoperASW 
 SBC  Communications,  Inc.  (1-  31-  03)  SBC  Sytel  Limited  (2-  3-  03)  Sytel 
 Teleperformance  USA  (4-  30-  03)  Teleperformance  Vector  Marketing  Corporation  (1-  31-  03)  Vector 
 Verizon  (1-  31-  03)  Verizon  Verizon  Wireless  (1-  31-  03)  Verizon  Wireless 
 Visa  (1-  31-  03)  Visa  VoltDelta  (Brad  Schorer;  12-  9-  02)  VoltDelta 
 Worldcom,  Inc.  (1-  31-  03)  Worldcom  Xpedite  Systems,  Inc.  (1-  31-  03)  Xpedite 
 Yellow  Pages  Integrated  Media  Association  (1-  31-  03)  Yellow  Pages 
156

 Federal  Communications  Commission  FCC  03-  153 
 157 
 Further  Comments  Filed 
 Active  Periodicals,  Inc.  (5-  5-  03)  Active  Periodicals  Allstate  Life  Insurance  Company  (5-  5-  03)  Allstate 
 American  Association  of  Retired  Persons  (AARP;  5-  19-  03)  AARP  American  Council  of  Life  Insurers  (5-  5-  03)  ACLI 
 American  Teleservices  Association  (5-  5-  03)  ATA  Americas  Community  Bankers  (5-  8-  03)  ACB 
 Ameriquest  Mortgage  Company  (5-  5-  03)  Ameriquest  Bank  of  America  Corporation  (Kathryn  D.  Kohler;  5-  2-  03)  Bank  of  America 
 Bank  One  Corporation  (5-  5-  03)  Bank  One  Cendant  Corporation  (5-  5-  03)  Cendant 
 Citigroup  Inc.  (5-  19-  03)  Citigroup  City  of  Chicago  (5-  1-  03)  City  of  Chicago 
 Chrusch,  Michael  J.,  Esq.  (5-  5-  03)  Consumer  Council  of  America  (5-  5-  03)  CCA 
 Direct  Marketing  Association  (5-  5-  03)  DMA  DIRECTV,  Inc.  (5-  5-  03)  DIRECTV 
 Electronic  Retailing  Association  (5-  5-  03)  ERA  Federal  Trade  Commission  (5-  12-  03)  FTC 
 Household  Bank  (SB),  N.  A.  (5-  2-  03)  Household  InfoCision  Management  Corporation  (5-  5-  03)  InfoCision 
 Interactive  Teleservices  Corporation  ITC  Intuit  Inc.  (5-  5-  03)  Intuit 
 Lorman  Education  Services  (5-  5-  03)  Lorman  MBNA  America  Bank,  N.  A.  (5-  5-  03)  MBNA 
 Metris  Companies  Inc.  (5-  5-  03)  Metris  Miller  Isar,  Inc.  (5-  2-  03)  Miller  Isar 
 Mortgage  Bankers  Association  of  America  (Kurt  Pfotenhauer;  5-  5-  03)  MBA  National  Association  of  Independent  Insurers 
 (National  Association  of  Independent  Insures  [sic];  5-  5-  03)  NAII  National  Association  of  Realtors 
 (National  Association  of  Realtor;  5-  5-  03)  NAR  National  Association  of  State  Utility  Consumer  Advocates 
 (NASUCA;  5-  5-  03)  NASUCA  National  Association  of  Insurance  and  Financial  Advisors  (5-  2-  03)  NAIFA 
 National  Telecommunications  Cooperative  Association  (NTCA;  5-  5-  03)  NTCA  Newspaper  Association  of  America  (5-  5-  03)  NAA 
 New  Jersey  State  Division  of  the  Ratepayer  Advocate  (5-  5-  03)  New  Jersey  Ratepayer  Nextel  Communications,  Inc.  (5-  5-  03)  Nextel 
 Scholastic  Inc.  (5-  5-  03)  Scholastic  Securities  Industry  Association  (James  Y.  Chin;  5-  5-  03)  SIA 
 Software  &  Information  Industry  Association  (5-  5-  03)  SIIA  Sprint  Corporation  (5-  5-  03)  Sprint 
 Stonebridge  Life  Insurance  Companies  (5-  5-  03)  Stonebridge  Teleperformance  USA  (4-  29-  03)  Teleperformance 
 Tennessee  Regulatory  Authority  (5-  5-  03)  TN  RA 
157

 Federal  Communications  Commission  FCC  03-  153 
 158 
 Vector  Marketing  Corporation  (Vector    Marketing  Corporation;  4-  29-  03)  Vector 
 Verizon  (5-  5-  03)  Verizon  Winstar  Communications,  LLC  (5-  5-  03)  Winstar 
 Worldcom,  Inc.  (5-  5-  03)  Worldcom  Yellow  Pages  Integrated  Media  Association  (5-  5-  03)  Yellow  Pages 
158

 Federal  Communications  Commission  FCC  03-  153 
 159 
 Further  Reply  Comments  Filed 
 American  Council  of  Life  Insurers  (5-  19-  03)  ACLI  American  Teleservices  Association  (5-  19-  03)  ATA 
 Americas  Community  Bankers  (5-  8-  03)  ACB  Ameriquest  Mortgage  Company  (5-  5-  03)  Ameriquest 
 Competitive  Telecommunications  Association  (5-  19-  03)  Competitive  Telecom  DialAmerica  Marketing,  Inc.  (5-  19-  03)  DMA 
 Indiana  Attorney  General  Steve  Carter  (5-  19-  03)  Indiana  AG  National  Association  of  State  Utility  Consumer  Advocates 
 (NASUCA;  5-  19-  03)  NASUCA  New  Jersey  State  Division  of  the  Ratepayer  Advocate  (5-  19-  03)  New  Jersey  Ratepayer 
 Primerica  Financial  Services,  Inc.  (5-  19-  03)  Primerica  SBC  Communications,  Inc.  (SBC  Communications  Inc.;  5-  19-  03)  SBC 
 Verizon  (5-  5-  03)  Verizon 
159

 Federal  Communications  Commission  FCC  03-  153 
 160 
 SEPARATE  STATEMENT  OF  CHAIRMAN  MICHAEL  K.  POWELL 
 Re:  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991;  CG  Docket  No.  02-  278 
 Our  decision  today  is  the  most  sweeping  consumer  protection  measure  ever  adopted  by  the  FCC.  No  longer  will  consumers  be  forced  to  endure  unwanted  telephone  calls  and  faxes. 
 Under  the  Telephone  Consumer  Protection  Act  (TCPA)  and  our  revised  rules,  consumers  are  empowered  to  choose. 


 The  TCPA  is  about  tools.  It  gives  consumers  the  tools  they  need  to  build  a  high  and  strong  fence  around  their  homes  to  protect  them  from  unsolicited  telephone  calls  and  faxes.  It 
 also  allows  other  consumers  to  have  a  lower  fence  or  no  fence  at  all,  if  they  wish  to  take  advantage  of  these  commercial  messages.  Our  decision  makes  the  American  consumers  toolbox 
 more  complete  by  creating  a  national  do  not  call  list  and  strengthening  and  modifying  our  other  longstanding  protections  under  the  TCPA.  Our  goal:  to  maximize  consumers  ability  to  control 
 the  messages  they  receive  on  their  personal  phones  and  faxes. 
 Since  the  enactment  of  the  TCPA  a  decade  ago,  the  rapid  growth  of  technology  has  led  to  a  five-  fold  increase  in  marketing  contacts  via  telephone.  An  increased  number  of  telemarketing 
 calls,  the  proliferation  of  predictive  dialers,  and  the  incomplete  protections  of  less-comprehensive  do  not  call  lists  have  combined  to  necessitate  the  Commissions  new  approach. 
 Consumers  want  more  control  over  their  telephones    today  we  give  it  to  them. 
 In  addition  to  the  national  do  not  call  list,  our  decision  contains  a  number  of  other  important  provisions.  First,  although  telemarketing  calls  made  pursuant  to  an  existing  business 
 relationship  are  exempt  under  the  TCPA,  the  Commission  today  significantly  narrows  the  scope  of  that  exemption  to  better  protect  consumers.  Consumers  may  eliminate  even  these  commercial 
 calls  upon  request.  Second,  we  tighten  the  limitations  on  our  existing  do  not  call  rules  and  impose  additional  requirements  on  predictive  dialers,  pre-  recorded  messages,  and  calls  to 
 wireless  phones.  We  also  require  telephone  solicitations  to  provide  caller  identification.  Finally  we  adopt  stricter  rules  to  control  unsolicited  fax  advertising.  Taken  together  and  combined  with 
 vigilant  enforcement,  our  rules  provide  consumers  with  the  tools  they  need  to  craft  the  commercial  relationships  they  want. 


 Consistent  with  the  instructions  in  the  recently  enacted  Do  Not  Call  Implementation  Act,  our  order  maximizes  consistency  and  complements  the  FTCs  recently  amended  rules.  I  look 
 forward  to  working  with  the  FTC,  under  the  fine  leadership  of  Chairman  Muris,  to  harmonize  our  rules  and  move  forward  with  nation-  wide  implementation  of  the  federal  Do-  Not-  Call 
 Registry. 
160

 Federal  Communications  Commission  FCC  03-  153 
 161 
 SEPARATE  STATEMENT  OF  COMMISSIONER  KATHLEEN  Q.  ABERNATHY 
 Re:  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991,  CG  Docket  No.  02-  278,  Report  and  Order 
 Todays  decision  to  establish  a  national  do-  not-  call  list  is  directly  responsive  to  consumer  frustration  with  telemarketing  overload.  Consumers  are  fed  up  with  the  barrage  of  telemarketing 
 calls  that  intrude  on  their  privacy,  and  they  crave  the  ability  to  just  say  no.  Congress  also  has  made  clear  the  importance  of  giving  consumers  a  more  effective  means  of  blocking  unwanted 
 calls.  Congress  authorized  establishment  of  a  national  do-  not-  call  registry  in  the  Telephone  Consumer  Protection  Act  of  1991,  and  earlier  this  year,  it  enacted  the  Do-  Not-  Call 
 Implementation  Act.  This  legislation  authorizes  funding  for  the  Federal  Trade  Commissions  national  registry  and  directs  this  Commission  to  maximize  consistency  with  the  FTCs 
 Telemarketing  Sales  Rule.  Todays  action  responds  to  this  congressional  direction  by  providing  a  convenient,  one-  stop  solution  that  will  enable  consumers  to  place  their  phone  numbers  on  a 
 unified  national  do-  not-  call  list  at  no  charge. 
 At  the  same  time,  I  remain  mindful  that  telemarketing  can  serve  a  valuable  function  by  providing  information  to  consumers  about  goods  and  services.  Many  consumers  appreciate 
 learning  about  ways  to  save  money,  obtain  better  service,  or  otherwise  take  advantage  of  commercial  opportunities.  Moreover,  telemarketers  enjoy  protection  under  the  First 
 Amendment,  which  requires  that  any  restrictions  on  commercial  speech  advance  a  substantial  governmental  interest  and  be  no  more  extensive  than  necessary.  Accordingly,  I  am  pleased  that 
 we  have  crafted  rules  that  balance  the  competing  interests  at  stake. 
 In  particular,  we  have  preserved  and  in  some  cases  modified  the  exemptions  for  calls  to  consumers  with  whom  the  marketer  has  an  established  business  relationship,  calls  to  consumers 
 who  have  expressly  consented  to  being  called,  and  calls  by  tax-  exempt  nonprofit  organizations  (or  by  independent  telemarketers  calling  on  their  behalf).  Consumers  should  understand  that,  as 
 a  result  of  these  statutory  exemptions,  placing  a  phone  number  on  the  national  do-  not-  call  list  will  not  necessarily  mean  that  you  will  receive  no  telemarketing  calls.  But  the  small  number  of 
 calls  received  should  be  more  consistent  with  consumers  expectations  of  privacy,  and  consumers  can  prohibit  any  further  contact  through  company-  specific  do-  not-  call  lists. 


 I  am  also  pleased  that  the  Commission  has  established  a  narrow  exemption  from  the  national  do-  not-  call  list  to  permit  marketers  to  contact  people  with  whom  they  have  a  personal 
 relationship.  I  believe  the  record  shows  that  Congress  was  concerned  about  anonymous  calls  using  autodialers;  it  did  not  intend  to  put  the  Avon  Lady  out  of  business.  Consumers  generally 
 expect  and  welcome  calls  from  family,  friends,  and  acquaintances  who  want  to  promote  products  and  services.  Restricting  such  calls  therefore  would  impose  a  more  extensive  burden  on  speech 
 than  is  necessary  to  achieve  Congresss  goals. 
161

 Federal  Communications  Commission  FCC  03-  153 
 162 
 In  addition,  the  Order  appropriately  clarifies  the  interplay  between  federal  and  state  telemarketing  restrictions.  While  I  support  empowering  consumers  to  block  unwanted  calls, 
 telemarketers  should  not  have  to  comply  with  multiple,  inconsistent  rules.  Indeed,  Congress  clearly  called  on  this  Commission  and  the  FTC  to  establish  a  uniform  federal  regime.  Thus,  the 
 Order  appropriately  clarifies  that,  while  states  may  enforce  the  federal  rules  and  may  adopt  more  restrictive  rules  for  intrastate  calls,  states  generally  may  not  regulate  interstate  calls. 


 In  sum,  I  am  pleased  to  support  this  Order,  because  it  provides  effective  mechanisms  for  consumers  to  restrict  unwanted  telemarketing  calls,  while  balancing  the  legitimate  interests  that 
 companies  and  individuals  have  in  communicating  with  customers  and  potential  customers.  I  expect  companies  to  comply  with  our  new  rules,  and  I  look  forward  to  working  together  with  the 
 FTC  and  state  attorneys  general  to  ensure  that  consumers  receive  the  privacy  protection  they  want  and  deserve. 
162

 Federal  Communications  Commission  FCC  03-  153 
 163 
 SEPARATE  STATEMENT  OF  COMMISSIONER  MICHAEL  J.  COPPS 
 Re:  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991  (CG  Docket  No.  02-  278),  Report  and  Order 
 Few  rights  are  so  fundamental  as  the  right  to  privacy  in  our  daily  lives,  yet  few  are  under  such  frontal  assault.  Our  dinners  are  disrupted  by  unwanted  phone  calls.  Our  computer  accounts 
 are  besieged  with  bothersome  spam.  Our  mailboxes  are  swollen  with  advertisements  for  products,  goods  and  services.  We  conduct  our  whole  lives  against  the  white  noise  of  commercial 
 solicitation.  These  intrusions  exhaust  us,  irritate  us  and  threaten  our  cherished  right  to  be  left  alone. 


 Today  we  have  an  opportunity  to  do  something  about  it.  We  have  an  opportunity  to  reinforce  our  homes  against  the  constant  invasion  of  commercialism  and  the  endless  nuisance  of 
 unwanted  telemarketing  calls.  At  the  direction  of  Congress  and  through  coordinated  action  with  the  Federal  Trade  Commission,  we  now  return  a  measure  of  privacy  control  to  citizens.  We 
 establish  a  national  Do-  Not-  Call  registry  that  permits  each  of  us  to  choose  limits  on  the  telemarketing  calls  we  receive.  We  do  this  in  a  way  that  balances  the  First  Amendment  rights  of 
 marketers  with  the  right  of  each  individual  and  every  household  to  determine  the  scope  of  permissible  intrusion.  This  decision  represents  a  positive  step  for  all  of  us,  not  only  as 
 consumers,  but  as  citizens.  I  am  pleased  to  support  it. 
 I  am  especially  pleased  that  the  rules  we  adopt  are  in  harmony  with  those  put  in  place  by  our  allies  in  this  exercise  at  the  Federal  Trade  Commission.  This  is  consistent  with  Congress 
 direction  that  we  maximize  consistency  with  the  rules  adopted  by  our  fellow  agency.  This  makes  for  a  user-  friendly  registry. 


 To  ensure  that  the  Do-  Not-  Call  list  achieves  the  protective  power  and  prominence  that  Congress  intended,  both  agencies  must  now  work  together  and  with  our  partners  in  the  states 
 to  enforce  the  national  program  we  establish  here  today.  When  the  Do-  Not-  Call  list  is  open  for  business,  we  will  share  the  duty  of  vigilant  enforcement.  We  worked  hard  here  to  balance  the 
 rights  and  privileges  of  personal  contacts  and  relationships  with  the  right  to  be  left  alone.  I  think  we  achieve  good  balance,  but  I  never  underestimate  the  inventiveness  of  some  in  skirting  or 
 abusing  rules,  and  these  individuals  and  enterprises  should  understand  that  such  actions  will  not  go  unnoticed  or  unpunished. 


 We  all  owe  a  debt  of  gratitude  to  the  many  people  at  our  Consumer  and  Governmental  Affairs  Bureau  who  worked  hard  to  draft  and  coordinate  and  bring  this  item  before  the 
 Commission  and  who  will  continue  to  labor  on  behalf  of  the  American  people  to  implement  the  rules  and  make  the  national  registry  a  success.  I  also  want  to  commend  my  colleagues  for  the 
 productive  discussions  we  have  had  on  this  item  in  recent  days.  The  result  is  a  little  more  privacy  in  our  not-  so-  private  society. 
163

 Federal  Communications  Commission  FCC  03-  153 
 164 
 SEPARATE  STATEMENT  OF  COMMISSIONER  JONATHAN  S.  ADELSTEIN 
 Re:  Rules  and  Regulations  Implementing  the  Telephone  Consumer  Protection  Act  of  1991  (CG  Docket  02-  278). 
 I  am  pleased  to  support  this  item.  By  adopting  a  National  Do-  Not-  Call  List,  we  arm  American  consumers  with  a  powerful  tool  to  protect  their  privacy.  This  is  one  of  the  most 
 significant  things  that  the  FCC  has  ever  done  for  American  families.  It  will  benefit  consumers  on  a  daily  basis  and  in  a  very  personal  way.  Its  certainly  the  thing  that  people  will  notice  as 
 much  as  anything  else  we  have  done.  Were  restoring  peace  and  quiet  around  the  dinner  table  for  everyone  who  asks  for  it,  and  plenty  will  ask,  myself  included.  The  public  has  sent  a 
 resounding  directive  telling  us  that  uninvited  telephone  solicitations  are  not  merely  a  distraction  but  are  driving  customers  away  from  their  phones.  Consumers  have  also  made  clear  that  our 
 prior  rules    without  a  national  Do-  Not-  Call  List    do  not  work  to  their  satisfaction.  And  Congress  has  made  its  wishes  clear  by  adopting  the  Do-  Not-  Call  Act  which  authorized  the 
 establishment  of  the  national  list.  My  hope  is  that  our  actions  here  will  allow  the  American  public  to  once  again  view  their  phones  as  a  useful  connection  to  the  world  rather  than  a  source  of 
 nightly  harassment. 
 At  the  same  time,  we  balance  the  interests  of  consumer  privacy  alongside  the  commercial  speech  interests  of  those  businesses  who  use  the  telephone  to  offer  goods  and  services  and  the 
 interests  of  those  consumers  willing  to  receive  such  offers.  The  record  bears  out  that  many  consumers  find  telephone  solicitations  valuable.  According  to  industry  estimates,  outbound 
 telemarketing  generates  between  300  and  600  billion  dollars  in  annual  revenues.  So,  I  am  sensitive  to  the  potential  impact  of  these  rules  on  the  businesses  that  rely  on  telephones  to  reach 
 their  customers.  I  have  particular  concern  about  the  local  telephone  industry,  where  the  practical  effect  of  our  established  business  relationship  exemption  may  have  an  uneven  impact  on 
 competitors.  Nonetheless,  Congress  has  captured  the  will  of  the  people    certainly,  as  reflected  in  our  record    when  it  directed  us  to  maximize  the  consistency  of  our  rules  with  the  newly-adopted 
 FTC  national  list.  Congress  did  not  explicitly  provide  for  particular  treatment  of  the  local  telephone  industry  in  the  Do-  Not-  Call  Act,  but  I  believe  that  this  area  warrants  our  special 
 attention  and  monitoring. 
 So  that  our  rules  are  no  more  extensive  than  necessary  and  because  American  consumers  each  hold  different  views  about  the  value  of  telephone  solicitations,  we  adopt  a  suite  of  options 
 from  which  customers  can  choose  the  approach  that  best  serves  their  needs.  Under  our  rules,  customers  may  sign  up  for  the  new  national  Do-  Not-  Call  List  or,  alternatively,  may  continue  to 
 receive  telemarketing  calls  and  sign  up  for  the  company-  specific  lists  when  they  no  longer  wish  to  hear  from  a  particular  company.  When  customers  sign  up  for  the  national  list,  they  still  have 
 the  ability  to  grant  express  permission  to  receive  calls  from  particular  companies.  So  our  rules  are  flexible  enough  to  allow  consumers  to  choose  the  best  option  for  them. 


 We  have  a  special  obligation  to  remain  vigilant  in  our  implementation  of  these  rules.  Congress  has  asked  us  to  report  to  it  annually.  I  look  forward  to  those  reports  with  the  optimism 
 that  we  have  adopted  measures  that  will  put  American  consumers  back  in  control  of  their  phones. 
164