When the National Do-Not-Call Registry ("Registry") was adopted in 2003, registering a phone number protected consumers from most telemarketing calls for five years. Thereafter, absent re-registration, numbers were expected to be removed from the Registry, and telemarketers could resume phone solicitations to those numbers. The Do-Not-Call program has proven to be very popular, and registrations have grown to well over 100 million numbers. In late 2007 and early 2008, however, with many registrations nearing expiration, federal agencies and now Congress have acted to forestall the removal of registered numbers from the Registry based solely on the expiration of the five-year term. Registrations now will last indefinitely, and consumers will not have to re-register.
In October 2007, the Federal Trade Commission (FTC) pledged not to drop numbers from the Registry following their expiration. The popularity of the Do-Not-Call program, plus concerns for consumers who might not understand why higher levels of telemarketing resumed, led the FTC to assert authority to maintain registrations, despite the plain language of its DNC rules. The agency thus created strong political incentives for Congress, the Federal Communications Commission ("FCC," the FTC's counterpart agency in regulating telemarketing), and the telemarketing industry to acquiesce in rule changes in support of indefinite registrations.
In November 2007, the FCC announced a proposed amendment to its rules to remove the five-year expiration period and maintain DNC registrations indefinitely. The FCC cited concerns that, without a rule change, tens of millions of registrations might expire in 2008. The comment period for this proposed change is now closed.
On February 15, 2008, President Bush signed into law two amendments to the Do-Not-Call Implementation Act ("Act"). H.R. 3541, the Do-Not-Call Improvement Act of 2007, prohibits the removal of a number from the Registry unless: (1) individuals request that their numbers be removed; or (2) numbers are invalid, disconnected, or reassigned. The FTC and FCC are expected to amend their respective telemarketing rules promptly to conform to the Act.
S.781, the Do-Not-Call Registry Fee Extension Act of 2007, reauthorized the FTC to collect fees from telemarketers for accessing the Registry. Congress also revamped the fee structure. Beginning with fiscal year 2009, a telemarketer will be able to access five area codes at no charge. Beginning with the sixth area code accessed, the FTC is directed to charge $54 if access to a particular area code is first requested during the first six months of a telemarketer's annual period, and $27 per area code first accessed during the second six months. In fiscal years after 2009, the Commission is to adjust these fees based on changes in the Consumer Price Index. As under the former law, entities not required to access the Registry may do so at no charge.
Consequences for Telemarketers
Telemarketers are justly concerned that the Registry remain accurate and up to date. Due to a high degree of turnover in phone numbers, aged registrations might easily refer to disconnected or reassigned numbers. Telemarketers bound not to call registered numbers would then forfeit a potential sale to a new holder of a phone number who never intended to prevent phone solicitations. The Act attempts to address these concerns by requiring the FTC to consult other appropriate databases to determine whether registered numbers have been disconnected and reassigned since their last registration.
This requirement, which resembles the agency's preexisting practice, reflects concern expressed to Congress by many marketers that telephone numbers have not always been purged from the Registry when reassigned. The House of Representatives' initial version of the recently enacted bill would have required the FTC to purge the list of reassigned numbers twice monthly; however, that provision was deleted after the agency advised Congress that it would be quite difficult to accomplish the purges that frequently.
The new legislation making registrations indefinite may require telemarketers to review their database management systems. "Scrubbing" procedures to remove registered phone numbers from calling lists likely were built in 2003, when the Do-Not-Call rules first came into effect with the five-year expiration mark. Procedures may have included "tagging" registered phone numbers with a date, five years from the time of registration, after which a telemarketer could resume phone solicitations. The virtue of this or similar features would have been the automatic release of a registered phone number back into a calling pool as soon as legally permitted. But in light of Congress' recent action, telemarketers must immediately root out such features. Otherwise, they may be unaware that they are calling numbers whose Do-Not-Call registrations remain in effect, risking possible regulatory enforcement actions, private suits, and reputational risk.