79–006

106TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 106–872

KNOW YOUR CALLER ACT OF 2000

SEPTEMBER 20, 2000.—Committed to the Committee of the Whole House on the

State of the Union and ordered to be printed

Mr. BLILEY, from the Committee on Commerce,

submitted the following

R E P O R T

[To accompany H.R. 3100]

[Including cost estimate of the Congressional Budget Office]

The Committee on Commerce, to whom was referred the bill

(H.R. 3100) to amend the Communications Act of 1934 to prohibit

telemarketers from interfering with the caller identification service

of any person to whom a telephone solicitation is made, and for

other purposes, having considered the same, report favorably thereon with an amendment and recommend that the bill as amended

do pass.

CONTENTS

Page

Amendment .............................................................................................................. 1

Purpose and Summary ............................................................................................ 3

Background and Need for Legislation .................................................................... 3

Hearings ................................................................................................................... 4

Committee Consideration ........................................................................................ 4

Committee Votes ...................................................................................................... 4

Committee Oversight Findings ............................................................................... 5

Committee on Government Reform Oversight Findings ...................................... 5

New Budget Authority, Entitlement Authority, and Tax Expenditures ............. 5

Committee Cost Estimate ....................................................................................... 5

Congressional Budget Office Estimate ................................................................... 5

Federal Mandates Statement ................................................................................. 7

Advisory Committee Statement .............................................................................. 7

Constitutional Authority Statement ...................................................................... 7

Applicability to Legislative Branch ........................................................................ 7

Section-by-Section Analysis of the Legislation ...................................................... 7

Changes in Existing Law Made by the Bill, as Reported ..................................... 8

AMENDMENT

The amendment is as follows:

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Strike all after the enacting clause and insert the following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Know Your Caller Act of 2000’’.

SEC. 2. PROHIBITION OF INTERFERENCE WITH CALLER IDENTIFICATION SERVICES.

Section 227 of the Communications Act of 1934 (47 U.S.C. 227) is amended—

(1) by redesignating subsections (e) and (f) as subsections (f) and (g), respectively; and

(2) by inserting after subsection (d) the following new subsection:

‘‘(e) PROHIBITION ON INTERFERENCE WITH CALLER IDENTIFICATION SERVICES.—

‘‘(1) IN GENERAL.—It shall be unlawful for any person within the United

States, in making any telephone solicitation—

‘‘(A) to interfere with or circumvent the capability of a caller identification

service to access or provide to the recipient of the telephone call involved

in the solicitation any information regarding the call that such service is

capable of providing; and

‘‘(B) to fail to provide caller identification information in a manner that

is accessible by a caller identification service, if such person has capability

to provide such information in such a manner.

For purposes of this section, the use of a telecommunications service or equipment that is incapable of transmitting caller identification information shall

not, of itself, constitute interference with or circumvention of the capability of

a caller identification service to access or provide such information.

‘‘(2) REGULATIONS.—Not later than 6 months after the enactment of the Know

Your Caller Act of 2000, the Commission shall prescribe regulations to implement this subsection, which shall—

‘‘(A) specify that the information regarding a call that the prohibition

under paragraph (1) applies to includes——

‘‘(i) the name of the person or entity who makes the telephone call

involved in the solicitation;

‘‘(ii) the name of the person or entity on whose behalf the solicitation

is made; and

‘‘(iii) a valid and working telephone number at which the person or

entity on whose behalf the telephone solicitation is made may be

reached during regular business hours for the purpose of requesting

that the recipient of the solicitation be placed on the do-not-call list required under section 64.1200 of the Commission’s regulations (47 CFR

64.1200) to be maintained by such person or entity; and

‘‘(B) provide that any person or entity who receives a request from a person to be placed on such do-not-call list may not use such person’s name

and telephone number for telemarketing, mail marketing, or other marketing purpose (including transfer or sale to any other entity for marketing

use) other than enforcement of such list.

‘‘(3) PRIVATE RIGHT OF ACTION.—A person or entity may, if otherwise permitted by the laws or rules of court of a State, bring in an appropriate court

of that State—

‘‘(A) an action based on a violation of this subsection or the regulations

prescribed under this subsection to enjoin such violation;

‘‘(B) an action to recover for actual monetary loss from such a violation,

or to receive $500 in damages for each such violation, whichever is greater;

or

‘‘(C) both such actions.

If the court finds that the defendant willfully or knowingly violated this subsection or the regulations prescribed under this subsection, the court may, in

its discretion, increase the amount of the award to an amount equal to not more

than 3 times the amount available under subparagraph (B) of this paragraph.

‘‘(4) DEFINITIONS.—For purposes of this subsection:

‘‘(A) CALLER IDENTIFICATION SERVICE.—The term ‘caller identification

service’ means any service or device designed to provide the user of the

service or device with the telephone number of an incoming telephone call.

‘‘(B) TELEPHONE CALL.—The term ‘telephone call’ means any telephone

call or other transmission which is made to or received at a telephone number of any type of telephone service and includes telephone calls made using

the Internet (irrespective of the type of customer premises equipment used

in connection with such services). Such term also includes calls made by an

automatic telephone dialing system, an integrated services digital network,

and a commercial mobile radio source.’’.

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SEC. 3. EFFECT ON STATE LAW AND STATE ACTIONS.

(a) EFFECT ON STATE LAW.—Subsection (f)(1) of section 227 of the Communications Act of 1934 (47 U.S.C. 227(f)(1)), as so redesignated by section 2(1) of this Act,

is further amended by inserting after ‘‘subsection (d)’’ the following: ‘‘and the prohibition under paragraphs (1) and (2) of subsection (e),’’.

(b) ACTIONS BY STATES.—The first sentence of subsection (g)(1) of section 227 of

the Communications Act of 1934 (47 U.S.C. 227(g)(1)), as so redesignated by section

2(1) of this Act, is further amended by striking ‘‘telephone calls’’ and inserting ‘‘telephone solicitations, telephone calls, or’’.

SEC. 4. STUDY REGARDING TRANSMISSION OF CALLER IDENTIFICATION INFORMATION.

The Federal Communications Commission shall conduct a study to determine—

(1) the extent of the capability of the public switched network to transmit the

information that can be accessed by caller identification services;

(2) the types of telecommunications equipment being used in the telemarketing industry, the extent of such use, and the capabilities of such types

of equipment to transmit the information that can be accessed by caller identification services; and

(3) the changes to the public switched network and to the types of telecommunications equipment commonly being used in the telemarketing industry

that would be necessary to provide for the public switched network to be able

to transmit caller identification information on all telephone calls, and the costs

(including costs to the telemarketing industry) to implement such changes.

The Commission shall complete the study and submit a report to the Congress on

the results of the study, not later than one year after the date of the enactment

of this Act.

PURPOSE AND SUMMARY

The purpose of this bill is to prevent telemarketers from interfering with or circumventing caller identification information from

being transmitted to consumers. This bill specifically prevents telemarketers from blocking caller identification information and requires telemarketers to provide that information when they have

the capability to do so. If a telemarketer’s telecommunications service or equipment is incapable of transmitting caller identification

information, it will not constitute a violation of the bill if that information is not transmitted. The bill also prohibits telemarketers

from using information on ‘‘do-not-call’’ lists for any marketing purpose.

BACKGROUND AND NEED FOR LEGISLATION

Telemarketing has been, and continues to be, a controversial

marketing practice. Telemarketing can provide huge benefits for

consumers. In many instances, consumers are introduced to new

opportunities or products through telemarketing. Telemarketing

can also promote the availability of competitive alternatives to incumbent providers and thus help facilitate a competitive marketplace. Unfortunately, certain telemarketing practices can be a significant and intrusive nuisance for consumers, as well as a source

of consumer confusion. In some instances, rogue telemarketers can

take advantage of this confusion to commit fraud against consumers.

To protect against these abuses, Congress enacted the Telephone

Consumer Protection Act of 1991 (P.L. 102–243; 47 U.S.C. §227).

Regulated by the FCC, the TCPA, among other things, requires

telemarketers to follow ‘‘do not call’’ requests from consumers, restricts telemarketing calling hours to 8:00 a.m.–9:00 p.m., mandates that telemarketers provide the name of the solicitor, name of

the entity calling, and the telephone number or address where that

person may be contacted, and includes a private right of action. ExVerDate 11-MAY-2000 06:30 Sep 21, 2000 Jkt 079006 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\HR872.XXX pfrm07 PsN: HR872
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emptions exist for established business relationships and tax-exempt non-profit organizations.

The FTC has also implemented the Telemarketing Sales Rule

which requires telemarketers to make certain disclosures and prohibits certain misrepresentations. These rules give the consumer

the power to stop unwanted telemarketing calls, requires solicitors

to identify the seller, their purpose and the nature of what is being

sold, limits commercial telephone solicitations to between 8:00 a.m.

and 9:00 p.m., and gives State law enforcement officers the authority to prosecute fraudulent telemarketers who operate across State

lines.

Despite these restrictions, complaints regarding telemarketing

practices continue to rise. According to the FTC, telemarketing

complaints have increased significantly from 1997–1999. In 1997,

the FTC received 2,260 complaints, in 1998 complaints rose to

8,667, and in 1999 complaints totaled 17,423. In light of these concerns, H.R. 3100 was drafted to create additional consumer protections.

HEARINGS

The Subcommittee on Telecommunications, Trade, and Consumer

Protection held a legislative hearing on H.R. 3100 on June 13,

2000. The Subcommittee received testimony from: The Honorable

Matt Salmon, M.C.; The Honorable Rodney Frelinghuysen, M.C.;

Ms. Eileen Harrington, Assistant Director of Marketing Practices,

Federal Trade Commission; The Honorable Jeff Hatch-Miller, Arizona House of Representatives; Ms. Virginia Tierney, on behalf of

the American Association of Retired Persons; and Mr. Steven R.

Brubaker, Senior Vice President of Operations, InfoCision Management Corp. on behalf of the American Teleservices Association.

COMMITTEE CONSIDERATION

On September 14, 2000, the Subcommittee on Telecommunications, Trade, and Consumer Protection was discharged from the

further consideration of H.R. 3100.

The Full Committee met in open markup session on September

14, 2000, and ordered H.R. 3100 reported to the House, with

amendment, by a voice vote, a quorum being present.

COMMITTEE VOTES

Clause 3(b) of rule XIII of the Rules of the House of Representatives requires the Committee to list the record votes on the motion

to report legislation and amendments thereto. There were no

record votes taken in connection with ordering H.R. 3100 reported.

A motion by Mr. Bliley to order H.R. 3100 reported to the House,

with an amendment, was agreed to by a voice vote.

The following amendments were agreed to by a voice vote:

An amendment in the nature of a substitute by Mr. Tauzin, No.

1, prohibiting telemarketers from blocking caller identification information, preempting State law relating to such violations, and requiring a FCC study to investigate the current state of transmission of caller identification information; and,

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An amendment to the amendment in the nature of a substitute

by Mr. Stearns, No. 1b, including Internet telephony as a communication governed under the bill.

The following amendment was withdrawn by unanimous consent:

An amendment to the amendment in the nature of a substitute

by Mr. Wynn, No. 1a, to require a live operator when using automatic dialing or predictive dialing equipment.

COMMITTEE OVERSIGHT FINDINGS

Pursuant to clause 3(c)(1) of rule XIII of the Rules of the House

of Representatives, the Committee held a legislative hearing and

made findings that are reflected in this report.

COMMITTEE ON GOVERNMENT REFORM OVERSIGHT FINDINGS

Pursuant to clause 3(c)(4) of rule XIII of the Rules of the House

of Representatives, no oversight findings have been submitted to

the Committee by the Committee on Government Reform.

NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX

EXPENDITURES

In compliance with clause 3(c)(2) of rule XIII of the Rules of the

House of Representatives, the Committee finds that H.R. 3100, the

Know Your Caller Act of 2000, would result in no new or increased

budget authority, entitlement authority, or tax expenditures or revenues.

COMMITTEE COST ESTIMATE

The Committee adopts as its own the cost estimate prepared by

the Director of the Congressional Budget Office pursuant to section

402 of the Congressional Budget Act of 1974.

CONGRESSIONAL BUDGET OFFICE ESTIMATE

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the House

of Representatives, the following is the cost estimate provided by

the Congressional Budget Office pursuant to section 402 of the

Congressional Budget Act of 1974:

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, September 20, 2000.

Hon. TOM BLILEY, Chairman, Committee on Commerce,

House of Representatives, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 3100, the Know Your

Caller Act of 2000.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contacts are Ken Johnson (for federal costs), Shelley Finlayson (for the state and local impact), and

Jean Wooster (for the private-sector impact).

Sincerely,

BARRY B. ANDERSON

(For Dan L. Crippen, Director).

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Enclosure.

H.R. 3100—Know Your Caller Act of 2000

CBO estimates that implementing H.R. 3100 would have a negligible impact on the federal budget. H.R. 3100 would prohibit telephone solicitors from purposefully blocking their contact information so that it does not appear on caller identification systems. The

contact information that must be transmitted consists of the name

of the person or entity that is placing the call, the organization on

whose behalf the call is being made, and a return phone number.

The bill would require the Federal Communications Commission

(FCC) to issue regulations to implement the bill within six months

of enactment. In addition, H.R. 3100 would establish a private

right of action in state courts to punish violations of these provisions. Finally, the bill would require the FCC to study issues surrounding the transmission of caller identification information and

report to the Congress within one year of the bill’s enactment.

Based on information from the FCC, CBO estimates that the

FCC would spend less than $500,000 annually to implement H.R.

3100, assuming the availability of appropriated funds. Because the

commission is authorized under current law to collect fees from the

telecommunications industry sufficient to offset the cost of its enforcement programs, CBO assumes that those additional costs

would be offset by an increase in collections credited to annual appropriations for the FCC.

H.R. 3100 contains an intergovernmental mandate as defined in

the Unfunded Mandates Reform Act (UMRA) because it would preempt certain provisions of state telemarketing statutes, which

could affect the associated fines and penalties. Because states vary

significantly in their regulation of telephone solicitors, CBO cannot

determine precisely the total revenue loss they would experience as

a result of this bill. However, based on our estimate of the number

of states regulating in this area, the size of the fines assessed, and

the amount of revenues generated from fines, CBO estimates that

revenue losses to states would not exceed the threshold established

by UMRA ($55 million in 2000, adjusted annually for inflation).

H.R. 3100 would also impose private-sector mandates, as defined

by UMRA, on telephone solicitors. A company that has telecommunication services or equipment that is capable of transmitting its name and phone number would be required to do so. The

bill also would prohibit those companies from using a person’s

name and number for telemarketing, mail marketing, or any other

marketing purposes when that person has requested to be placed

on a ‘‘do-not-call’’ list.

Based on information from the FCC and industry representatives, CBO estimates that the cost of the mandates would be well

below the threshold established by UMRA for private-sector mandates ($109 million in 2000, adjusted annually for inflation).

The CBO staff contacts for this estimate are Ken Johnson (for

federal costs), Shelley Finlayson (for the state and local impact),

and Jean Wooster (for the private-sector impact). This estimate

was approved by Robert A. Sunshine, Assistant Director for Budget

Analysis.

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FEDERAL MANDATES STATEMENT

The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office

pursuant to section 423 of the Unfunded Mandates Reform Act.

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the

Federal Advisory Committee Act were created by this legislation.

CONSTITUTIONAL AUTHORITY STATEMENT

Pursuant to clause 3(d)(1) of rule XIII of the Rules of the House

of Representatives, the Committee finds that the Constitutional authority for this legislation is provided in Article I, section 8, clause

3, which grants Congress the power to regulate commerce with foreign nations, among the several States, and with the Indian tribes.

APPLICABILITY TO LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the

terms and conditions of employment or access to public services or

accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act.

SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Sec. 1. Short title

This section establishes the short title of the legislation, the

‘‘Know Your Caller Act of 2000’’.

Sec. 2. Prohibition of interference with caller identification services

This section amends section 227 of the Communications Act of

1934 (47 U.S.C. § 227) by making it unlawful for any person making a telephone solicitation to interfere with or circumvent the

transmission of caller identification information. If a person making a telephone solicitation has the ability to provide caller identification information, that person must provide such information.

The use of telecommunications service or equipment that is incapable of transmitting such information does not constitute interference or circumvention pursuant to the bill.

This section also directs the Federal Communications Commission to prescribe regulations implementing the subsection. The regulations must direct the person making the telemarketing call to

disclose the following caller identification information: the name of

the person placing the telephone solicitation, the name of the person on whose behalf the solicitation is being made, and a valid

working telephone number of the person or entity on whose behalf

the telephone solicitation is being made. This section also provides

that the names and telephone numbers complied as part of a ‘‘donot-call’’ list must not be used for any marketing purpose.

This section further allows a person or entity to bring a private

right of action for an injunction, actual monetary damages or $500

per violation, or both. If a court finds the defendant acted willfully

or knowingly, the court may award treble damages.

8

This section also defines a ‘‘caller identification service’’ and

‘‘telephone call.’’

Sec. 3. Effect on State law and State actions

This section makes it clear that any State may bring an action

for blocking caller identification information during a telephone solicitation or telephone call. This section also preempts State laws

that deal with the same subject matter, although it allows States

to set fines higher than the $500 fine set forth in section 2(e)(3)(B).

Sec. 4. Study regarding transmission of caller identification information

This section requires that the FCC, within one year, conduct a

study to determine the capability of the public switched network to

transmit caller identification information; the types of equipment

being used by the telemarketing industry and the capability of such

equipment to transmit caller identification information; the

changes necessary to the public switched network and telemarketing equipment to allow for the transmission of caller identification information in all instances; and the cost related to those

changes.

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the

House of Representatives, changes in existing law made by the bill,

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic,

existing law in which no change is proposed is shown in roman):

SECTION 227 OF THE COMMUNICATIONS ACT OF 1934

SEC. 227. RESTRICTIONS ON THE USE OF TELEPHONE EQUIPMENT.

(a) * * *

* * * * * * *

(e) PROHIBITION ON INTERFERENCE WITH CALLER IDENTIFICATION

SERVICES.—

(1) IN GENERAL.—It shall be unlawful for any person within

the United States, in making any telephone solicitation—

(A) to interfere with or circumvent the capability of a

caller identification service to access or provide to the recipient of the telephone call involved in the solicitation any

information regarding the call that such service is capable

of providing; and

(B) to fail to provide caller identification information in

a manner that is accessible by a caller identification service, if such person has capability to provide such information in such a manner.

For purposes of this section, the use of a telecommunications

service or equipment that is incapable of transmitting caller

identification information shall not, of itself, constitute interference with or circumvention of the capability of a caller identification service to access or provide such information.

(2) REGULATIONS.—Not later than 6 months after the enactment of the Know Your Caller Act of 2000, the Commission

9

shall prescribe regulations to implement this subsection, which

shall—

(A) specify that the information regarding a call that the

prohibition under paragraph (1) applies to includes—

(i) the name of the person or entity who makes the

telephone call involved in the solicitation;

(ii) the name of the person or entity on whose behalf

the solicitation is made; and

(iii) a valid and working telephone number at which

the person or entity on whose behalf the telephone solicitation is made may be reached during regular business hours for the purpose of requesting that the recipient of the solicitation be placed on the do-not-call list

required under section 64.1200 of the Commission’s

regulations (47 CFR 64.1200) to be maintained by such

person or entity; and

(B) provide that any person or entity who receives a request from a person to be placed on such do-not-call list

may not use such person’s name and telephone number for

telemarketing, mail marketing, or other marketing purpose

(including transfer or sale to any other entity for marketing

use) other than enforcement of such list.

(3) PRIVATE RIGHT OF ACTION.—A person or entity may, if otherwise permitted by the laws or rules of court of a State, bring

in an appropriate court of that State—

(A) an action based on a violation of this subsection or

the regulations prescribed under this subsection to enjoin

such violation;

(B) an action to recover for actual monetary loss from such a violation, or to receive $500 in damages for each

such violation, whichever is greater; or

(C) both such actions.

If the court finds that the defendant willfully or knowingly violated this subsection or the regulations prescribed under this

subsection, the court may, in its discretion, increase the amount

of the award to an amount equal to not more than 3 times the

amount available under subparagraph (B) of this paragraph.

(4) DEFINITIONS.—For purposes of this subsection:

(A) CALLER IDENTIFICATION SERVICE.—The term ‘‘caller

identification service’’ means any service or device designed

to provide the user of the service or device with the telephone number of an incoming telephone call.

(B) TELEPHONE CALL.—The term ‘‘telephone call’’ means

any telephone call or other transmission which is made to

or received at a telephone number of any type of telephone

service and includes telephone calls made using the Internet (irrespective of the type of customer premises equipment

used in connection with such services). Such term also includes calls made by an automatic telephone dialing system, an integrated services digital network, and a commercial mobile radio source.

ø(e)¿ (f) EFFECT ON STATE LAW.—

(1) STATE LAW NOT PREEMPTED.—Except for the standards

prescribed under subsection (d) and the prohibition under

paragraphs (1) and (2) of subsection (e), and subject to paraVerDate 11-MAY-2000 06:30 Sep 21, 2000 Jkt 079006 PO 00000 Frm 00009 Fmt 6659 Sfmt 6601 E:\HR\OC\HR872.XXX pfrm07 PsN: HR872
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graph (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) * * *

* * * * * * *

ø(f)¿ (g) ACTIONS BY STATES.—

(1) AUTHORITY OF STATES.—Whenever the attorney general of

a State, or an official or agency designated by a State, has reason to believe that any person has engaged or is engaging in

a pattern or practice of øtelephone calls¿ telephone solicitations, telephone calls, or or other transmissions to residents of

that State in violation of this section or the regulations prescribed under this section, the State may bring a civil action

on behalf of its residents to enjoin such calls, an action to recover for actual monetary loss or receive $500 in damages for

each violation, or both such actions. If the court finds the defendant willfully or knowingly violated such regulations, the

court may, in its discretion, increase the amount of the award

to an amount equal to not more than 3 times the amount available under the preceding sentence.

* * * * * * *

Æ