What are the Main Telemarketing Laws?
Federal statutes and regulations that govern commercial communication by telephone include the following:
- The Telemarketing Consumer Fraud and Abuse Prevention Act
- The Telemarketing Sales Rule
- The Telephone Consumer Protection Act
- The National Do-Not-Call Registry
What is the Telemarketing Consumer Fraud and Abuse Prevention Act?
Generally referred to as the “Telemarketing Act,” the Telemarketing Consumer Fraud and Abuse Prevention Act (15 S.C. §6101) does all of the following:
- Prohibits specific deceptive and abusive telemarketing acts or practices
- Requires disclosure of certain material information
- Requires express verifiable authorization for certain payment mechanisms
- Sets record-keeping requirements
- Specifies exempt transactions
What is the Telemarketing Sales Rule?
The Federal Trade Commission (FTC) established the Telemarketing Sales Rule (16 C.F.R. §§ 310.1 to 310.9) (TSR) to enforce the Telemarketing Act. The TSR does all of the following:
- Prohibits deceptive and abusive telemarketing acts or practices
- Establishes a national do-not-call registry maintained by the FTC
- Establishes an allowable calling time from 8:00 m. to 9:00 p.m
- Restricts unauthorized billing
- Requires telemarketers to transmit caller identification information and imposes disclosure and consent requirements related to telemarketing transactions
The TSR applies to companies that sell goods or services by telephone and which involve more than one interstate telephone call.
What is the Telephone Consumer Protection Act?
The Telephone Consumer Protection Act of 1991 (TCPA), as amended, has a much broader scope than the TSR, governing calls, texts, and faxes for both telemarketing and informational purposes (the TSR only applies to telemarketing calls). The communications restrictions in the TCPA depend on the type of equipment used and the content of the message. For example, the law prohibits:
- Telemarketing calls and texts to wireless lines using artificial or prerecorded voice recordings or an automatic dialing system (ATDS) without receiving prior express written consent
- Informational calls and texts to wireless lines using artificial or prerecorded voice recordings or an ATDS without receiving prior express consent (does not need to be written)
- Telemarketing calls (but not informational calls) to residential landlines using artificial or prerecorded voice recordings without receiving prior express written consent
The Federal Communications Commission (FCC) has the authority to prescribe rules enforcing the TCPA, process complaints, and institute enforcement actions.
What is the National Do Not Call Registry?
The National Do-Not-Call (DNC) Registry empowers consumers to stop calls from almost all companies within the FTC’s jurisdiction. Telephone numbers on the registry are only removed when they are disconnected and reassigned, or when consumers choose to remove them. Telemarketers covered by the registry have up to 31 days from the date a consumer registers to stop calling. Although expansive, the DNC registry does not cover calls:
- From organizations with which the consumer has an established business relationship
- For which the consumer has given prior written consent
- That are not commercial or do not include unsolicited advertisements
- By or on behalf of tax-exempt non-profit organizations
What Laws Govern Marketing by Text?
A “call” as that term is used in the TCPA has been held by the courts and the FCC to cover text messages. Accordingly, the TCPA’s requirements for calls to wireless numbers also apply to texts. The FCC regulations implementing the TCPA prohibit the use of an Automated Telephone Dialing System to provide a message to any mobile telephone without the prior written consent of the subscriber.
Text messages may also be covered by CAN-SPAM which requires the FCC to issue rules related to mobile service commercial messages. The FCC’s Implementation Rules address CAN-SPAM’s applicability to text messaging and provide that the technology employed to send the message will determine whether it is covered by CAN-SPAM. If the text message is from internet-to- phone, which involves addresses that reference internet domains, then it is covered by CAN-SPAM. In contrast, if the text message does not involve addresses that reference the internet, as in phone-to-phone text messages, then CAN-SPAM does not apply.
What Laws Govern Marketing by Fax?
The TCPA prohibits sending unsolicited commercial advertisements to a person or business by fax. The FCC has adopted regulations under the TCPA regarding unsolicited fax advertisements (see 47 C.F.R. § 64.1200). Prior written consent is required except when there is an existing business relationship.
Another law governing fax marketing is the Junk Fax Prevention Act of 2005, which permits the sending of commercial faxes to recipients based on an existing business relationship, as long as the sender offers an opt-out in accordance with the TCPA. The opt-out must be easy to find and free.
What are the Rules for Marketing by Fax?
Under the FCC regulations, the business on whose behalf a fax is being sent must identify itself in the top or bottom margin of each page or on the first page of the fax message and must include its telephone number with the date and time the fax is sent.
If a fax broadcaster (a company that sends faxes on another’s behalf) demonstrates a high degree of involvement in the sender’s fax messages, such as supplying the fax numbers to which a message is sent, the fax broadcaster must provide its name on the fax. A fax broadcaster may be liable if it supplies fax numbers to a business or entity sending unlawful fax advertisements.
What Laws Govern Marketing by Direct Mail?
Certain types of direct mail are prohibited under the Deceptive Mail Prevention and Enforcement Act (DMPEA) (39 U.S.C. § 3001). In addition, like all advertising, direct mail must be in compliance with the Federal Trade Commission Act (15 USC §41) (the FTC Act).
What is the Deceptive Mail Prevention and Enforcement Act?
The DMPEA prohibits any non-governmental entity from sending solicitations that imply a federal government connection for the purchase of, or payment for, a product or service. The DMPEA also requires certain information in all direct mailings that contain sweepstakes or contest entry materials, including:
- A disclosure that no purchase is necessary and that a purchase will not enhance the participant’s chances of winning
- The sponsor’s name and street address
- The complete official rules and entry procedures, which must disclose all the material terms and conditions of the sweepstakes or contest, the nature and value of the prize, and the numeric odds of receiving the prize, if applicable
Direct marketers who send sweepstakes or contest entry materials must maintain a name removal system, which allows recipients to opt out of receiving future sweepstakes or contest mailings. The mailing must disclose the existence of the name removal system to recipients.
What is the FTC Act?
The FTC Act prohibits unfair and deceptive advertising in any medium, including direct mail solicitations. An advertisement, whether through mail or otherwise, must be truthful and not mislead consumers. An advertising claim can be misleading if relevant information is left out or if the claim implies something that is not true. Often, reasonable consumers can interpret the advertisement as making several statements. Advertisers are responsible for all reasonable consumer interpretations of their advertising for their products and services.
What laws govern email marketing?
The main US law governing email marketing is the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (15 U.S.C. §7701) (CAN-SPAM).
What does the CAN-SPAM Act do?
CAN-SPAM does all of the following:
- Establishes requirements for those who send commercial and transactional email (though transactional emails are less regulated)
- Provides penalties for violators and companies whose products are advertised in commercial email in violation of the law
- Gives consumers the right to opt out of commercial email
CAN-SPAM applies equally to emails to consumers and to business recipients and there is no business-to-business exception.
What does the CAN-SPAM Act require?
CAN-SPAM’s main provisions include the following:
- A ban on false or misleading header information, including the originating domain name and email address
- A prohibition on deceptive subject lines
- A requirement that those who send commercial email must give recipients a free, easy-to-use opt-out method
- A requirement that commercial email be identified as an advertisement and include the sender’s valid physical postal address
- A requirement that warning labels be added to commercial email that contains sexually oriented material
Who Enforces the CAN-SPAM Act?
The CAN-SPAM Act authorizes the FTC to adopt and enforce rules regarding commercial email sent to computers, while the FCC is authorized to adopt and enforce rules regarding commercial email sent to wireless phones and mobile devices.