To amend section 227 of the Communications Act of 1934 to clarify the prohibition on junk fax transmissions.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Junk Fax Prevention Act of 2004''.

SEC. 2. PROHIBITION ON FAX TRANSMISSIONS CONTAINING UNSOLICITED 
              ADVERTISEMENTS.

    (a) Prohibition.--Subparagraph (C) of section 227(b)(1) of the 
Communications Act of 1934 (47 U.S.C. 227(b)(1)(C)) is amended to read 
as follows:
                    ``(C) to use any telephone facsimile machine, 
                computer, or other device to send, to a telephone 
                facsimile machine, an unsolicited advertisement, 
                unless--
                            ``(i) the unsolicited advertisement is from 
                        a sender with an established business 
                        relationship with the recipient, and
                            ``(ii) the unsolicited advertisement 
                        contains a notice meeting the requirements 
                        under paragraph (2)(D),
                except that the exception under clauses (i) and (ii) 
                shall not apply with respect to an unsolicited 
                advertisement sent to a telephone facsimile machine by 
                a sender to whom a request has been made not to send 
                future unsolicited advertisements to such telephone 
                facsimile machine that complies with the requirements 
                under paragraph (2)(E); or''.
    (b) Definition of Established Business Relationship.--Subsection 
(a) of section 227 of the Communications Act of 1934 (47 U.S.C. 227(a)) 
is amended--
            (1) by redesignating paragraphs (2) through (4) as 
        paragraphs (3) through (5), respectively; and
            (2) by inserting after paragraph (1) the following new 
        paragraph:
            ``(2) The term `established business relationship', for 
        purposes only of subsection (b)(1)(C)(i), shall have the 
        meaning given the term in section 64.1200 of the Commission's 
        regulations, as in effect on January 1, 2003, except that--
                    ``(A) such term shall include a relationship 
                between a person or entity and a business subscriber 
                subject to the same terms applicable under such section 
                to a relationship between a person or entity and a 
                residential subscriber; and
                    ``(B) an established business relationship shall be 
                subject to any time limitation established pursuant to 
                paragraph (2)(G).''.
    (c) Required Notice of Opt-Out Opportunity.--Paragraph (2) of 
section 227(b) of the Communications Act of 1934 (47 U.S.C. 227(b)(2)) 
is amended--
            (1) in subparagraph (B), by striking ``and'' at the end;
            (2) in subparagraph (C), by striking the period at the end 
        and inserting a semicolon; and
            (3) by adding at the end the following new subparagraph:
                    ``(D) shall provide that a notice contained in an 
                unsolicited advertisement complies with the 
                requirements under this subparagraph only if--
                            ``(i) the notice is clear and conspicuous 
                        and on the first page of the unsolicited 
                        advertisement;
                            ``(ii) the notice states that the recipient 
                        may make a request to the sender of the 
                        unsolicited advertisement not to send any 
                        future unsolicited advertisements to a 
                        telephone facsimile machine or machines and 
                        that failure to comply, within the shortest 
                        reasonable time, as determined by the 
                        Commission, with such a request meeting the 
                        requirements under subparagraph (E) is 
                        unlawful;
                            ``(iii) the notice sets forth the 
                        requirements for a request under subparagraph 
                        (E);
                            ``(iv) the notice includes--
                                    ``(I) a domestic contact telephone 
                                and facsimile machine number for the 
                                recipient to transmit such a request to 
                                the sender; and
                                    ``(II) a cost-free mechanism for a 
                                recipient to transmit a request 
                                pursuant to such notice to the sender 
                                of the unsolicited advertisement; the 
                                Commission shall by rule require the 
                                sender to provide such a mechanism and 
                                may, in the discretion of the 
                                Commission and subject to such 
                                conditions as the Commission may 
                                prescribe, exempt certain classes of 
                                small business senders, but only if the 
                                Commission determines that the costs to 
                                such class are unduly burdensome given 
                                the revenues generated by such small 
                                businesses;
                            ``(v) the telephone and facsimile machine 
                        numbers and the cost-free mechanism set forth 
                        pursuant to clause (iv) permit an individual or 
business to make such a request during regular business hours; and
                            ``(vi) the notice complies with the 
                        requirements of subsection (d);''.
    (d) Request To Opt-Out of Future Unsolicited Advertisements.--
Paragraph (2) of section 227(b) of the Communications Act of 1934 (47 
U.S.C. 227(b)(2)), as amended by subsection (c) of this section, is 
further amended by adding at the end the following new subparagraph:
                    ``(E) shall provide, by rule, that a request not to 
                send future unsolicited advertisements to a telephone 
                facsimile machine complies with the requirements under 
                this subparagraph only if--
                            ``(i) the request identifies the telephone 
                        number or numbers of the telephone facsimile 
                        machine or machines to which the request 
                        relates;
                            ``(ii) the request is made to the telephone 
                        or facsimile number of the sender of such an 
                        unsolicited advertisement provided pursuant to 
                        subparagraph (D)(iv) or by any other method of 
                        communication as determined by the Commission; 
                        and
                            ``(iii) the person making the request has 
                        not, subsequent to such request, provided 
                        express invitation or permission to the sender, 
                        in writing or otherwise, to send such 
                        advertisements to such person at such telephone 
                        facsimile machine;''.
    (e) Authority To Establish Nonprofit Exception.--Paragraph (2) of 
section 227(b) of the Communications Act of 1934 (47 U.S.C. 227(b)(2)), 
as amended by subsections (c) and (d) of this section, is further 
amended by adding at the end the following new subparagraph:
                    ``(F) may, in the discretion of the Commission and 
                subject to such conditions as the Commission may 
                prescribe, allow professional or trade associations 
                that are tax-exempt nonprofit organizations to send 
                unsolicited advertisements to their members in 
                furtherance of the association's tax-exempt purpose 
                that do not contain the notice required by paragraph 
                (1)(C)(ii), except that the Commission may take action 
                under this subparagraph only by regulation issued after 
                public notice and opportunity for public comment and 
                only if the Commission determines that such notice 
                required by paragraph (1)(C)(ii) is not necessary to 
                protect the ability of the members of such associations 
                to stop such associations from sending any future 
                unsolicited advertisements; and''.
    (f) Authority To Establish Time Limit on Established Business 
Relationship Exception.--Paragraph (2) of section 227(b) of the 
Communications Act of 1934 (47 U.S.C. 227(b)(2)), as amended by 
subsections (c), (d), and (e) of this section, is further amended by 
adding at the end the following new subparagraph:
                    ``(G)(i) may, consistent with clause (ii), limit 
                the duration of the existence of an established 
                business relationship to a period not shorter than 5 
                years and not longer than 7 years after the last 
                occurrence of an action sufficient to establish such a 
                relationship, but only if--
                                    ``(I) the Commission determines 
                                that the existence of the exception 
                                under paragraph (1)(C) relating to an 
                                established business relationship has 
                                resulted in a significant number of 
                                complaints to the Commission regarding 
                                the sending of unsolicited 
                                advertisements to telephone facsimile 
                                machines;
                                    ``(II) upon review of such 
                                complaints referred to in subclause 
                                (I), the Commission has reason to 
                                believe that a significant number of 
                                such complaints involve unsolicited 
                                advertisements that were sent on the 
                                basis of an established business 
                                relationship that was longer in 
                                duration than the Commission believes 
                                is consistent with the reasonable 
                                expectations of consumers;
                                    ``(III) the Commission determines 
                                that the costs to senders of 
                                demonstrating the existence of an 
                                established business relationship 
                                within a specified period of time do 
                                not outweigh the benefits to recipients 
                                of establishing a limitation on such 
                                established business relationship; and
                                    ``(IV) the Commission determines 
                                that, with respect to small businesses, 
                                the costs are not unduly burdensome, 
                                given the revenues generated by small 
                                businesses, and taking into account the 
                                number of specific complaints to the 
                                Commission regarding the sending of 
                                unsolicited advertisements to telephone 
                                facsimile machines by small businesses; 
                                and
                    ``(ii) may not commence a proceeding to determine 
                whether to limit the duration of the existence of an 
                established business relationship before the expiration 
                of the 3-year period that begins on the date of the 
                enactment of the Junk Fax Prevention Act of 2004.''.
    (g) Unsolicited Advertisement.--Paragraph (5) of section 227(a) of 
the Communications Act of 1934 (47 U.S.C. 227(a)(4)), as so 
redesignated by subsection (b)(1) of this section, is amended by 
inserting ``, in writing or otherwise'' before the period at the end.
    (h) Regulations.--Except as provided in clause (ii) of section 
227(b)(2)(G) of the Communications Act of 1934 (as added by subsection 
(f) of this section), not later than 270 days after the date of the 
enactment of this Act, the Federal Communications Commission shall 
issue regulations to implement the amendments made by this section.

SEC. 3. FCC ANNUAL REPORT REGARDING JUNK FAX ENFORCEMENT.

    Section 227 of the Communications Act of 1934 (47 U.S.C. 227) is 
amended by adding at the end the following new subsection:
    ``(g) Junk Fax Enforcement Report.--The Commission shall submit a 
report to the Congress for each year regarding the enforcement of the 
provisions of this section relating to sending of unsolicited 
advertisements to telephone facsimile machines, which shall include the 
following information:
            ``(1) The number of complaints received by the Commission 
        during such year alleging that a consumer received an 
        unsolicited advertisement via telephone facsimile machine in 
        violation of the Commission's rules.
            ``(2) The number of such complaints received during the 
        year on which the Commission has taken action.
            ``(3) The number of such complaints that remain pending at 
        the end of the year.
            ``(4) The number of citations issued by the Commission 
        pursuant to section 503 during the year to enforce any law, 
        regulation, or policy relating to sending of unsolicited 
        advertisements to telephone facsimile machines.
            ``(5) The number of notices of apparent liability issued by 
        the Commission pursuant to section 503 during the year to 
        enforce any law, regulation, or policy relating to sending of 
        unsolicited advertisements to telephone facsimile machines.
            ``(6) For each such notice--
                    ``(A) the amount of the proposed forfeiture penalty 
                involved;
                    ``(B) the person to whom the notice was issued;
                    ``(C) the length of time between the date on which 
                the complaint was filed and the date on which the 
                notice was issued; and
                    ``(D) the status of the proceeding.
            ``(7) The number of final orders imposing forfeiture 
        penalties issued pursuant to section 503 during the year to 
        enforce any law, regulation, or policy relating to sending of 
        unsolicited advertisements to telephone facsimile machines.
            ``(8) For each such forfeiture order--
                    ``(A) the amount of the penalty imposed by the 
                order;
                    ``(B) the person to whom the order was issued;
                    ``(C) whether the forfeiture penalty has been paid; 
                and
                    ``(D) the amount paid.
            ``(9) For each case in which a person has failed to pay a 
        forfeiture penalty imposed by such a final order, whether the 
        Commission referred such matter for recovery of the penalty.
            ``(10) For each case in which the Commission referred such 
        an order for recovery--
                    ``(A) the number of days from the date the 
                Commission issued such order to the date of such 
                referral;
                    ``(B) whether an action has been commenced to 
                recover the penalty, and if so, the number of days from 
                the date the Commission referred such order for 
                recovery to the date of such commencement; and
                    ``(C) whether the recovery action resulted in 
                collection of any amount, and if so, the amount 
                collected.''.

SEC. 4. GAO STUDY OF JUNK FAX ENFORCEMENT.

    (a) In General.--The Comptroller General of the United States shall 
conduct a study regarding complaints received by the Federal 
Communications Commission concerning unsolicited advertisements sent to 
telephone facsimile machines, which shall determine--
            (1) the mechanisms established by the Commission to 
        receive, investigate, and respond to such complaints;
            (2) the level of enforcement success achieved by the 
        Commission regarding such complaints;
            (3) whether complainants to the Commission are adequately 
        informed by the Commission of the responses to their 
        complaints; and
            (4) whether additional enforcement measures are necessary 
        to protect consumers, including recommendations regarding such 
        additional enforcement measures.
    (b) Additional Enforcement Remedies.--In conducting the analysis 
and making the recommendations required under paragraph (7) of 
subsection (a), the Comptroller General shall specifically examine--
            (1) the adequacy of existing statutory enforcement actions 
        available to the Commission;
            (2) the adequacy of existing statutory enforcement actions 
        and remedies available to consumers;
            (3) the impact of existing statutory enforcement remedies 
        on senders of facsimiles;
            (4) whether increasing the amount of financial penalties is 
        warranted to achieve greater deterrent effect; and
            (5) whether establishing penalties and enforcement actions 
        for repeat violators or abusive violations similar to those 
        established by section 4 of the CAN-SPAM Act of 2003 (15 U.S.C. 
        7703) would have a greater deterrent effect.
    (c) Report.--Not later than 270 days after the date of the 
enactment of this Act, the Comptroller General shall submit a report on 
the results of the study under this section to Committee on Energy and 
Commerce of the House of Representatives and the Committee on Commerce, 
Science, and Transportation of the Senate.

            Passed the House of Representatives July 20, 2004.

            Attest:

                                                 JEFF TRANDAHL,

                                                                 Clerk.

Summary: Junk Fax Prevention Act of 2004 - Amends the Communications Act of 1934 to prohibit a person from using any telephone facsimile (fax) machine, computer, or other device to send, to another fax machine, an unsolicited advertisement, unless the advertisement: (1) is from a sender with an established business relationship with the recipient; and (2) contains a notice on its first page that the recipient may request not to be sent any future unsolicited advertisements, and that failure to comply with such request is unlawful. Requires such notice to include a domestic contact telephone and fax machine number for the recipient to transmit such a request, as well as a cost-free mechanism for sending the request.

Requires the Federal Communications Commission (FCC) to provide that a request not to send unsolicited advertisements complies with FCC requirements if: (1) the request identifies the recipient fax number to which the request relates; (2) the request is made to the telephone or fax number of the sender; and (3) the person making the request has not subsequently provided express invitation or permission to the sender to have such advertisements sent. Authorizes the FCC to allow tax-exempt, nonprofit professional or trade associations to send unsolicited advertisements to their members in furtherance of professional or association purposes.

Authorizes the FCC, upon determining a significant number of complaints involving unsolicited fax advertisements, to limit the duration of the existence of an "established business relationship" exemption to a period not shorter than five and not longer than seven years after the last occurrence of an action sufficient to establish such relationship.

Requires the: (1) FCC to report annually to Congress on the enforcement of the above requirements; and (2) Comptroller General to study, and report to specified congressional committees on, complaints received by the FCC concerning unsolicited advertisements sent to fax machines.