Washington Report

Keeping Members Informed About Regulatory Issues

Contents
May 2000

STATE LEGISLATIVE UPDATE

If you have questions about the following legislation or other state issues, contact Jerry Cerasale at 202-861-2423 or jcerasale@the-dma.org or Elizabeth Scanlon at 202-861-2418 or escanlon@the-dma.org.

NEW LAWS/SIGNED BILLS

TELEPHONE MARKETING

OBTAIN A COPY OF TENNESSEE'S DO NOT CALL REGISTER IMMEDIATELY.
Tennessee's "do-not-call" law has been amended this year by H.B. 2610 which was signed by the Governor May 17, 2000, and is effective upon his signature. The new law changes the date by which the do-not-call database is operative from July 1, 2000 to April 1, 2000.

Telephone marketers may obtain electronic access to the list, which contains residential phone numbers only, by completing an application and paying an annual fee of $500.

A copy of the application form telephone marketers must submit to gain access to the list is available on the Tennessee Regulatory Authority's website at http://www2.state.tn.us/tra/nocall.htm (click on "Solicitor Application").

The completed form must be mailed to: Tennessee Regulatory Authority ATTN: DO NOT CALL REGISTER P.O. Box 198907 Nashville, TN 37219-8907.

A fee for paper copies will be established by rule.

Monthly updates to the list will be sent to telephone marketers via e-mail; marketers have 60 days to update their calling lists after receiving the monthly updates.

Missouri S.B. 763 has passed both houses of the legislature. The amended and substituted bill prohibits, as of July 1, 2001, telephone solicitation calls to residential subscribers who have given notice to the attorney general that they do not wish to receive such calls. The attorney general must promulgate rules governing the state no-call database by January 1, 2001. The database will be issued quarterly. The attorney general may establish and operate the database using general revenue and other state funds. Telephone marketers will pay a fee (to be determined by regulation) for access to the database.

The bill also requires telephone marketers to make disclosures, keep records and not engage in unlawful practices consistent with the federal Telemarketing Sales Rule and exempts from those requirements:

1. Calls in which the sale is not completed and payment is not required until after a face-to-face sales presentation;

2. Calls in which the sale is completed and a written contract is sent to the consumer, the consumer may return merchandise within 14 days of receipt and receive a refund, and the consumer is informed, at the time of the sales call:
(a) that a written contract will be sent
(b) of the approximate delivery date; and
(c) of the consumer's right to terminate the contract within 14 days of receipt of the merchandise, return the merchandise and receive a refund;

3. Calls initiated by the consumer that are: (a) not the result of an advertisement by a seller or telephone marketer;
(b) in response to an advertisement B through any media other than direct mail or telephone B that discloses the seller's name and the identity of the merchandise; however, this exemption does not apply to an advertisement offering a prize or investment opportunity, or offered by a person engaging in prohibited telephone marketing activities;
(c) in response to direct mail solicitations that clearly and conspicuously disclose and do not misrepresent required material information; however, this exemption does not apply to an advertisement offering a prize or an investment opportunity, or offered by a person engaging in prohibited telephone marketing activities; or
(d) in response to a catalog received in the mail.

4. Telephone calls or messages made:
(a) with a consumer's prior express invitation or permission;
(b) to a consumer with whom the seller has an established business relationship;
(c) by or on behalf of an entity regulated by a state or federal agency; or
(d) to a business; however, calls involving the retail sale of nondurable office and cleaning supplies are not exempt.

The bill prohibits a person or entity conducting business in Missouri from sending or causing commercial e-mail to be sent without including a toll-free telephone number or valid return e-mail address the recipient may use to notify the sender not to send further e-mail ads.

PENDING LEGISLATION

PRIVACY AND DATA USE

Connecticut H.B. 5586, which has passed both houses of the legislature, requires retailers who issue discount cards or devices to give written notice to consumers that information about them may be sold, leased, or relinquished to other persons, firms, or corporations; describe the purposes for which such information would be used, and include a form the consumer may use to prevent the retailer from selling, leasing, or relinquishing such information.

Minnesota S.F. 3834 requires state agencies that collect licensing information from individuals, including motor vehicle and driver license data, to provide clear and conspicuous notice that data on the individual may be released and used for a commercial purpose unless the individual requests that it not be used; and that if the data is used for a commercial purpose, the individual is entitled to receive a payment based on a share of the revenue generated from distributing the data for commercial purposes.

New York A.B. 11002 prohibits financial institutions from disclosing, directly or through an affiliate, confidential customer information to unaffiliated third parties without written or electronic consent.

South Carolina H.B. 4642 prohibits the distribution, sale or rental of names and addresses by a state agency unless specifically authorized by law and requires an individual's prior written authorization before his name and address is added to an agency's mailing list. State agencies that collect personal information are required to maintain the source or sources of the information in a readily accessible form.

Agencies collecting personal information are required to provide a notice on any form used to collect personal information, which notice must include: the principal purpose for which the information is to be used; any known or foreseeable disclosures which may be made of the information; and the individual's right of access to records containing personal information which are maintained by the agency.

TELEPHONE MARKETING

New York S.B. 7827 requires the public service commission to establish a quarterly "telephone solicitation prohibition database" of telephone numbers of state residents who do not wish to receive unsolicited consumer telephone calls. Calls made 5 days after the list is issued to persons on the list are in violation. Consumers are not to be charged for placing their telephone numbers on the list; the amount charged to telephone marketers for copies of the list is yet to be determined.

North Carolina H.B. 1493 requires telephone solicitors to maintain in-house do-not-call lists and prohibits blocking or otherwise circumventing a subscriber's use of a caller identification service. Telephone solicitors who use a PBX or other call-generating system that does not transmit caller ID information are not in violation of the proposed law.

Telephone marketers must disclose the legal name of the person calling and inquire at the beginning of the call if the person consents to a solicitation. If the called party gives a negative response, the solicitor must immediately terminate the call.

Local exchange companies are required to provide notice to their customers of federal law allowing consumers to object to receiving telephone solicitation calls, and of industry programs that allow consumers to have their names removed from telephone marketing lists.

TAX

California S.B. 1556 exempts from the sales and use tax tangible personal property used to provide broadband services in the conduct of an Internet service business for the provision of advanced digital communications services or similar services.

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