The Federal Communications Commission (FCC) approved and published its amended Telephone Consumer Protection Act (TCPA) regulations in February 2012, imposing additional consent, abandonment, and opt-out requirements for prerecorded or autodialed telemarketing calls. The new call abandonment and opt-out requirements went into effect in November 2012 and January 2013, respectively. (See our alert on these requirements here. The new written consent requirements for telemarketing calls go into effect on October 16, 2013.
New Consent Requirements for Prerecorded or Autodialed Telemarketing Calls
- Telemarketing Calls to Mobile Phones
- Old rule: Prior express consent—verbal or written—required for prerecorded/autodialed telemarketing calls to mobile phones.
- New rule: Prior express written consent required for prerecorded/autodialed telemarketing calls to mobile phones.
- NOTE: Some kind of consent (verbal or written) is, for the most part, always required for prerecorded or autodialed telephone calls made to mobile phones. If it is a telemarketing call, it must now be in writing. Verbal consents are still sufficient if the call is purely informational.
- Telemarketing Calls to Residential Lines
- Old rule: Prior express consent—verbal or written—required for prerecorded telemarketing calls, unless the caller has an “established business relationship” with the consumer.
- New rule: Eliminates exemption for “established business relationships” (was applicable to residential calls only). Prior express written consent now required for all prerecorded telemarketing calls to residential lines.
- NOTE: No consent required for purely informational calls to residential lines.
The new rules harmonize the requirements for mobile and residential phones with respect to telemarketing calls—prior express written consent is now required for both.
An important difference still remains in that some type of consent—either verbal or written—is required for informational or non-telemarketing calls made to mobile phones. No such consent is required for informational or non-telemarketing calls made to residential phones.
What Constitutes “Telemarketing”?
- Telemarketing calls include those that offer, market, or promote products or services to consumers or that have a telemarketing purpose. If a call is conducted to induce the purchase of goods or services, it is a telemarketing call. As a general rule, calls that are not purely informational in purpose and message constitute telemarketing.
- Dual-purpose calls—calls that have both an informational component and a telemarketing purpose—are deemed telemarketing (e.g., calls or text messages reminding consumers that their gift certificates or coupons are about to expire).
- Telemarketing does not include the following:
- Debt collection calls
- Calls by or on behalf of tax-exempt nonprofit organizations (although nonprofit entities engaged in for-profit-type activities should remain cautious)
- Calls for political purposes
- Calls made by loan servicers regarding the servicing of a consumer loan or home loan modification, and refinance calls placed by loan servicers pursuant to the American Recovery and Reinvestment Act (also known as the Recovery Act)
- Calls for noncommercial purposes, including airline notification calls, bank and credit card balance and fraud alerts, school and university notifications, research or survey calls, package deliveries, and wireless usage notifications
What Is “Prior Express Written Consent”?
- The term prior express written consent means an agreement, in writing, bearing the signature of the person called that clearly authorizes the seller to deliver or cause to be delivered to the person called advertisements or telemarketing messages using an automatic telephone dialing system or an artificial or prerecorded voice, and the telephone number to which the signatory authorizes such advertisements or telemarketing messages to be delivered.
- An electronic or digital form of signature is acceptable, to the extent this form of signature is recognized as a valid signature under applicable federal or state law. Consent obtained in compliance with the E-SIGN Act will satisfy the requirements of the new rules, including permission obtained via e-mail, website form, text message, telephone keypress, or voice recording. Traditional forms of writing will also suffice.
What Clear and Conspicuous Disclosures Must Be Made to Consumers?
- The consumer authorizes the seller to deliver or cause to be delivered telemarketing calls using an automatic telephone dialing system (ATDS) or an artificial or prerecorded voice; and
- The consumer is not required to sign or enter the agreement as a condition of purchasing any property, goods, or services.
New Written Consent Checklist
- Identify each specific company to whom consent is being provided.
- Identify the consumer’s mobile phone number.
- Indicate an affirmative agreement (i.e., I agree/consent…).
- Disclose that the consumer is authorizing the seller to engage in telemarketing (i.e., to receive offers related to the seller’s products or services).
- Disclose that the calls will be made using automated technology.
- Disclose that the consumer is not required to provide consent as a condition of purchasing goods or services.
- Obtain a written signature from the consumer (either electronically through E-SIGN or handwritten).
What Does This Mean with Respect to Existing Customers?
- If a business has only verbal consent from existing customers, it may continue to make autodialed or prerecorded telemarketing calls to these customers until October 16, 2013. Beginning October 16, businesses will no longer be able to rely on non-written forms of consent.
- If a business has prior written consent from existing consumers, it will need to evaluate whether these prior written consents conform to the new regulatory requirements (see checklist above). To the extent these prior written consents are missing any of the new requirements above, businesses will need to decide whether to contact existing customers to get the proper consents before the October 16 deadline, scrub these numbers from their calling lists, or rely on their prior written consents going forward. Where possible, the best practice is to get written consent in conformity with all the new requirements prior to October 16.
TCPA Best Practices
- Obtain written consent early in the consumer relationship (at the time of the initial application, consumer transaction or contact, etc.).
- Specifically disclose that you intend to send SMS text messages, where applicable.
- Avoid sweeping language in consent forms referring broadly to affiliates, partners, or brands. The new regulations require that the specific seller be identified and named.
- Require online consumers to take affirmative action, such as manually checking a box clearly providing the required disclosures and/or clicking a submit button after manually typing in their telephone number.
- Create a record-keeping system and implement procedures to store and access the new written consents obtained from consumers. The burden of proving consent lies with the seller, not the consumer.
- Use phone lists that were obtained directly from consumers and be wary of purchasing phone lists that are represented to consist of “opt-ins.” Once you buy and use the list, it effectively becomes yours.