In the ever-evolving landscape of communication, telemarketing stands out as one of the most heavily regulated areas. The Telephone Consumer Protection Act (TCPA) has long been the guardian of consumers’ rights, safeguarding them from intrusive calls and texts without their consent. Administered by the Federal Communications Commission (FCC), TCPA consent rules are intricate, often overlapping, and crucial in ensuring responsible communication in today’s digital age. With an increasing number of people relying solely on mobile phones (approximately 80% of U.S. households), the implications of TCPA are more significant than ever.
Over the past few months, several key changes have taken place, or are in the process of taking place, within the TCPA landscape. This article aims to provide an overview of these changes, helping organizations align their TCPA practices with the latest regulations and communicate with customers in lawful and welcomed ways.
Understanding Frequency Restrictions
For many years, the FCC has allowed certain communications, such as package delivery notifications, healthcare updates, and banking alerts, to be made without prior customer consent. These exemptions have been a longstanding feature of TCPA rules but were reviewed and formalized under the TRACED Act of 2019.
In December 2020, the FCC, as mandated by the TRACED Act, reevaluated these exemptions, primarily for calls to residential phone lines and wireless numbers. The Exemptions Report and Order codified these exemptions, with some modifications, particularly in the form of limitations on the number of calls/messages that can be sent under most exemptions. Let’s focus on the exemptions related to calls/messages to residential numbers and the implications of the upcoming limitations.
Exemptions on Calls to Residential Numbers
Section 227(b)(2)(B) of the TCPA empowers the FCC to create exemptions to the restrictions on calls that include prerecorded content or an artificial voice to residential lines. These exemptions include calls “not made for a commercial purpose” and calls made for commercial purposes that do not involve unsolicited advertisements. The FCC has introduced four key residential-focused exemptions, which are:
- Calls not made for a commercial purpose
- Commercial calls not containing an advertisement or telemarketing
- Calls made by or on behalf of a tax-exempt nonprofit organization
- “Health care” calls made by entities subject to HIPAA
In the recent Exemptions Report and Order, the FCC modified these exemptions by limiting the number of calls that can be made to residential numbers within a specific time frame and requiring that consumers have the option to opt-out of future calls. The effective date for these changes was set for July 20, 2023, due to delays in the approval process.
Here are the key limitations introduced:
- Calls Not Made for a Commercial Purpose: Within any consecutive 30-day period, the caller can make no more than three calls to residential numbers. Additionally, consumers must have the option to opt-out of future calls, respecting their preferences.
- Commercial Calls Without Advertisements: Similar to the above, the caller can make no more than three calls to residential numbers within a consecutive 30-day period. Consumers can also opt-out of these calls.
- Calls by Tax-Exempt Nonprofit Organizations: The same limitations as the first two categories apply.
- Health Care Messages under HIPAA: A maximum of one call per day to a residential line is allowed, with a maximum of three calls per seven-day period. Consumers can opt-out of these calls as well.
As we approach the implementation date, organizations relying on these exemptions should ensure that their policies and procedures comply with these new limitations. This includes tracking the number of calls to residential numbers and implementing opt-out mechanisms for consumers.
New FCC Rulemaking on Consent to Receive Communications
On June 9, 2023, the FCC released a Notice of Proposed Rulemaking (NPRM) to strengthen consumers’ ability to grant and revoke consent for receiving automated calls and text messages. This rulemaking proposes three noteworthy changes:
- Limiting Wireless Providers’ Communications: The NPRM suggests requiring wireless providers to respect customer requests to cease automated voice calls, prerecorded voice calls, and automated text messages. This would alter the previous ruling that exempted wireless carriers from obtaining consent for such communications. The proposed restrictions are similar to those applicable to other “free to the end user” (FTEU) communications, including package delivery notifications and healthcare updates.
- Strengthening Consumer Revocation of Consent: The NPRM proposes to codify that consumers can revoke their consent in any reasonable manner. Sending a “STOP” message, or a similar message indicating a desire to stop receiving messages, would create a presumption of consent revocation. Callers would also be prohibited from specifying an exclusive means of revoking consent that precludes other reasonable methods.
- Confirmation Texts: The NPRM proposes that one-time confirmation texts, confirming a consumer’s request to stop receiving further messages, do not violate the TCPA. These confirmation texts must not contain marketing or advertising content or persuade consumers to reconsider their opt-out.
Potential Restrictions on Comparison Shopping and Lead Generation
The FCC also released a Further Notice of Proposed Rulemaking (FNPRM) on March 17, 2023, addressing the “lead generator loophole” and proposing changes to TCPA consent.
This rulemaking seeks to ban entities from obtaining a single consumer’s consent and then using it to deliver calls or texts from multiple marketers that go beyond the scope of the consent. The FCC also acknowledges the value of comparison shopping websites and aims to ensure that consumers can consent to further information without receiving calls and texts from unrelated companies.
In this context, the FCC proposes that consent collected via a website should apply only to callers “logically and topically associated” with the website and whose names are clearly disclosed on the same webpage. This suggests that a single consent can cover multiple entities, provided certain conditions are met.
The recent actions and proposed rule changes by the FCC demonstrate an increased focus on consumer-friendly restrictions regarding automated messages and telemarketing activities. Therefore, organizations sending TCPA-covered communications should review their policies to ensure compliance with these rules. Key areas for review include:
- The frequency and type of communications directed to consumers
- The means by which consent is collected from consumers
- Recordkeeping capabilities to demonstrate compliance
- Procedures for consumers to revoke consent and honoring these requests
Periodic reviews of TCPA practices are always a good idea. However, given the evolving regulatory landscape, a comprehensive review has become more timely and necessary than ever.
Please note that the FCC has not yet adopted any final rules or clarifications, so interested parties may continue to present their views to the Commission. Staying informed and proactive in complying with TCPA rules is key to maintaining effective communication with consumers while respecting their consent and preferences.