Revised Federal Telemarketing Rules
This paper summarizes the major changes to the telemarketing rules recently adopted by the
Federal Trade Commission and Federal Communications Commission. It is important to note
that the federal rules constitute a floor, and thus would supersede all less restrictive state do not
call rules, particularly those state rules that had specifically exempted newspapers from its do not
call requirements. With respect to more restrictive state regulations, neither the FTC nor FCC
will preempt more restrictive intrastate requirements; however, the FCC will preempt more
restrictive state regulation of interstate telemarketing calls that differs from the federal rules,
since those state rules would be in conflict and presumably frustrate the federal objective of
creating uniform national rules. In addition, the Telephone Consumer Protection Act prohibits
states, in regulating telephone solicitations, from using any database or list that does not include
the part of the national DNC database that relates to that state.
Some of the rules may be modified further since several organizations, including the NAA, have
petitioned the FCC for clarification or a stay of its rules until the agency clarifies the scope of
certain rules. In addition, the FTC and FCC plan to negotiate a Memorandum of Understanding
that will resolve any inconsistencies and duplicative enforcement, as well as submit a report to
Congress within 45 days after publication in the Federal Register that will note any remaining
inconsistencies between the agencies’ rules. As of now, the amended rules will go into effect as
IMPORTANT DATES TO REMEMBER
• March 31, 2003 -- Express verifiable authorization will be required, except for credit
card or debit card transactions.
• August 25, 2003 – Artificial or prerecorded voice messages that include or introduce an
“unsolicited advertisement” are prohibited unless the recipient has given prior express
consent or has an established business relationship with the seller or telemarketer.
• August 25, 2003 – Unsolicited advertising material must not be sent by facsimile unless
the person or entity sending the fax has an established business relationship with the
recipient or has obtained the prior express permission of the recipient.
• September 1, 2003 – Sellers and telemarketers will be given access to the national do not
• October 1, 2003 – Sellers and telemarketers must refrain from calling consumers who
register their telephone numbers on the national do not call list, unless the seller or
telemarketer falls within a specified exemption.
Newspaper Association of America
1921 Gallows Road, Suite 600, Vienna, VA 22182-3900
703•902•1600 FAX 703•917-0636
• October 1, 2003 – Predictive dialers must not drop or abandon more then three percent
of all calls and must ring the consumer’s telephone for at least 15 seconds or four rings
• January 29, 2004 – Sellers and telemarketers must transmit caller ID information.
• January 1, 2005 – Persons or entities sending unsolicited advertising material by
facsimile must have the signed, written consent of the recipient.
PERMITTED TELEPHONE CALLS
• Newspapers and their telemarketers may call businesses, since the restrictions on
telephone solicitations generally do not apply to business-to-business calls1.
• Newspapers/telemarketers may call consumers whose telephone numbers are neither
registered on the national do-not-call list nor included in the newspaper/telemarketer’s
company specific do-not-call list.
• Newspapers/telemarketers may call individuals whose telephone numbers are registered
on the national DNC list, but (1) who have given your specific company express
permission to call them or (2) who have an established business relationship with your
company or (3) who have a personal relationship with the caller (e.g., the caller is a
family member, friend or acquaintance of the called individual). However, these
exemptions do not apply when individuals have asked to be placed on a company’s
specific DNC list.
• Federal telemarketing laws do not cover—and, thus do not restrict—calls made for
purposes other than telemarketing, such as bill collection, conducting surveys, market
research, or reporting when a delivery will be made.
DO NOT CALL
• Newspapers and their telemarketers will be required to access the national DNC database,
unless they fall within one of the exemptions (EBR, express consent, personal
relationship) mentioned above. Access will become available on September 1, 2003 by
going to a fully-automated and secure http://www.telemarketing.donotcall.gov/ (website
is not yet available). The database will provide the seller/telemarketer with a unique
account number. Newspapers that call only persons with whom they have an established
business relationship or from whom they have obtained express consent to call are not
required to access the national registry prior to engaging in those calls. However, if those
newspapers/telemarketers want to access the registry, they do not have to pay for access.
• Newspapers that place “cold calls” are required to pay for access to the national registry,
regardless of whether their telemarketing vendor pays for independent access. A
newspaper’s telemarketer will not be permitted to use the information they obtain from
FTC’s rules restrict business to business calls, only if the seller is selling non-durable office or cleaning supplies.
the national registry on the newspaper’s behalf unless the newspaper had paid the
appropriate fee for access to the information or, in cases where the newspaper is exempt,
submitted the appropriate certification to gain access to the national registry.
• Separate divisions, subsidiaries or affiliates of a newspaper group or company must pay a
separate annual fee for access to the national registry. The FTC will consider whether the
entity is separately incorporated (or a separate partnership) and whether the entity has a
• A seller or its telemarketer may have free access to up to five areas codes. However,
beginning with the sixth area code, the FTC will charge an annual fee of $25 per area
code, with a cap of $7,375 for access to the entire national database. Once the annual fee
is paid, the newspaper/telemarketer will have unlimited access to the DNC registry
throughout the year. However, it will be required to access the registry at least once
every three months to synchronize all of its calling lists with an updated version of the
• Beginning October 1, 2003, newspapers and their telemarketers will be prohibited from
calling persons whose telephone numbers are registered on the national database, unless
the newspaper can rely upon one of the three exemptions mentioned above. Consumer
registrations will remain valid for five years, with the registry periodically being purged
of all numbers that have been disconnected or reassigned.
• Newspapers or their telemarketing vendors, who acting in good faith, place prohibited
calls may fall within a safe harbor under which they would not be liable for failure to
comply with DNC requirements, if they: (1) have established and implemented written
procedures to comply with the DNC rules; (2) trained their personnel, and any entity
assisting in their compliance, in the procedures established pursuant to the DNC rules; (3)
have maintained and recorded a list of telephone numbers the newspaper may not
contact; (4) have used and documented a process to prevent telemarketing to any
telephone number on any list established pursuant to the DNC rules, employing a version
of the DNC registry obtained from the administrator of the registry no more than three
months before the date the call was made; and (5) made the call in error.
ESTABLISHED BUSINESS RELATIONSHIP
• As of now, the Office of Management and Budget has not reviewed or approved the new
definition of “established business relationship” so the 1992 definition of EBR will
remain in effect pending OMB approval. The 1992 definition refers to “a prior or
existing relationship formed by a voluntary two-way communication between a person or
entity and a residential subscriber with or without an exchange of consideration, on the
basis of an inquiry, application, purchase or transaction by the residential subscriber
regarding products or services offered … which relationship has not been previously
terminated by either party.”
• Once OMB reviews and approves the new definition, which requires “a voluntary two-
way communication between a person or entity and a residential subscriber regarding a
purchase or transaction made within eighteen (18) months of the date of the
telemarketing call or regarding an inquiry or application within three (3) months of the
date of the call”, newspapers may call current or former subscribers or advertisers for a
period up to 18 months after the consumer’s last purchase, payment or delivery of the
newspaper’s product/service or up to three months after the consumer’s inquiry or
application regarding the newspaper’s products or services, even if the consumer’s phone
number has been added to the national do not call registry. It is important to note that an
EBR is formed by a voluntary two-way communication between the newspaper and
consumer. It cannot be formed, for example, by a newspaper unilaterally delivering a
product to a consumer’s residence and relying on the consumer’s silence as consent.
• The FCC recognizes that many companies offer a wide variety of services and products
and that a consumer should not be surprised to receive a telemarketing call from that
company, regardless of the product being offered. Thus, a newspaper’s circulation
department may rely upon the EBR exception to call a consumer who has placed a
private party classified ad in the newspaper, but is not a current subscriber.
• The EBR remains as long as the consumer does not ask to be placed on the newspaper’s
company specific DNC list. Once a consumer asks a newspaper not to call him or her,
the newspaper must place the consumer’s telephone number on its own internal DNC list.
At that point, the EBR is terminated for purposes of telephone solicitations, even if the
consumer still remains a newspaper subscriber or an advertising customer. The
newspaper or its telemarketer must honor a company-specific DNC request within a
reasonable time of the request, not to exceed 30 days.
• A DNC request, whether company-specific or national, must be honored for five years
from the time the request is made or the number is registered in the national database.
EXPRESS VERIFIABLE AUTHORIZATION
• Newspapers and their telemarketing vendors, must obtain express verifiable authorization
for all transactions before submitting billing information for payment, except when the
method of payment used is a credit card subject to protections of the Truth in Lending
Act and Regulation Z, or a debit card subject to the protections of the Electronic Fund
Transfer act and Regulation E.
• For express oral authorization to be deemed verifiable, a newspaper must ensure the
customer’s receipt of the date that the charge will be submitted for payment and identify
the account to be charged with sufficient specificity so that the customer understands
what account is being used to collect payment.
• Express verifiable authorization is particularly important where the newspaper or
telemarketer already possess the consumer’s billing information (“preacquired billing
information”) and in free-to pay transactions, particularly where there is a “negative
option feature” (e.g., the cost of a newspaper subscription is free or reduced for the first
six months and automatically continues at the full rate after the six-month period if the
customer does not affirmatively decline the offer or terminate the subscription). In these
transactions, the newspaper must clearly disclose (1) the fact that the customer’s account
will be charged unless the customer takes an affirmative action to avoid the charge; (2)
the date the charge will be submitted for payment; and (3) specific steps the customer
must take to avoid the charges. Silence should not be construed as acceptance.
• Payment by automatic debit from a bank account or phone check, for example, would
require express verifiable authorization. Authorization is deemed “verifiable” if it (1) is
in writing and includes the customer’s signature, or (2) is given orally, but audio-
recorded and made available upon request to the customer and to the customer’s bank or
(3) consists of written confirmation of the transaction sent to the customer via first class
mail before the customer’s billing information is submitted for payment, with the written
confirmation clearly labeled as such on the outside of the envelope in which it is sent. A
customer’s signed check or money order would be sufficient to serve as written
authorization. Post-transaction written confirmation is not permitted as a means of
obtaining a customer’s express verifiable authorization when the goods or services are
offered on a “free-to-pay conversion basis. Newspapers/telemarketers that use the oral
method of authorization are responsible for determining compliance with state law
• To address concerns about identity theft, newspapers/telemarketer providing express
verifiable authorization should identify billing information sufficient to understand what
account will be used to collect payment, such as the name and last four digits of the
account to be charged, rather than the full account number.
ARTIFICIAL OR PRERECORDED VOICE MESSAGES
• FCC regulations prohibit telephone calls to residences using artificial or prerecorded
voice messages that include or introduce an “unsolicited advertisement”, unless the
recipient has given prior express consent or has an EBR with the seller or telemarketer.
Examples of messages that include or introduce an unsolicited advertisement would be
dual purpose calls, such as those to inquire about a customer’s satisfaction with an
already purchased subscription but include a sales pitch for additional goods or services
or prerecorded messages that contain free offers and information about goods and
services that are commercially available to consumers. Thus, newspapers without an
EBR or the prior express consent of the recipient should not deliver such prerecorded
• All prerecorded messages, whether delivered by automated dialing equipment or not,
must identify the name of the business or entity that is responsible for initiating the call,
along with the telephone number of the business or entity. The legal name of the
business should be given, even if the newspaper gives its “doing business as” name, and
the telephone number stated in the message should be one that a consumer can use during
normal business hours to ask not to be called again.
• Federal telemarketing rules govern predictive dialers as “automated telephone dialing
equipment”, since they have the capacity to store or produce numbers and dial those
numbers at random. Telemarketers remain prohibited from using autodialers to dial
emergency numbers, health care facilities, telephone numbers assigned to wireless
services and any other numbers for which the consumer is charged for the call. In
addition, they are prohibited from so-called “war dialing” (i.e., ringing a telephone for the
purpose of determining whether the number is associated with a fax or voice line).
• Under the FTC’s regulations, newspapers/telemarketers are prohibited from abandoning
any outbound telephone call (e.g., where the telemarketer does not connect the call to a
sales representative within two seconds of the person’s completed greeting). A safe
harbor exists for the telemarketer who (1) ensures abandonment of no more than three
percent of all calls answered by a person per day per calling campaign; (2) allows the
telephone to ring for at least 15 second or four rings before disconnecting an unanswered
call; and (3) plays a recorded message stating the newspaper’s name and telephone
number whenever a sales representative is not available to speak with the called person
within two seconds after the person’s completed greeting.
• The FCC’s regulations have similar requirement, except the three percent of
unanswered calls are to be measured over a 30-day period.
CALLER ID INFORMATION
• Newspapers/telemarketers must transmit caller ID information, regardless of their calling
systems. The amended rule, not only prohibits the blocking of caller ID information, but
also prohibits the failure to transmit such information. Caller ID information must
include the telephone number, and when available by the telemarketer’s carrier, the name
of the telemarketer. A telemarketer may elect to transmit the name and telephone number
of the newspaper client, rather than its own, as long as the number is one that the
consumer may call during reasonable hours to make a do not call request.
• In those limited instances where the caller ID information is not passed through to the
consumer, through no fault of the telemarketer, then the telemarketer will not be held
liable for failure to the comply with the rules. However, the telemarketer must provide
clear and convincing evidence that the caller ID information could not be transmitted.
• Newspapers may not send unsolicited advertisements or promotions by facsimile unless
they have the prior express invitation or permission of the recipient. Unlike the telephone
solicitation rules, this rule applies to business to business calls, in addition to business to
consumer calls. The prohibition applies to faxes sent by stand alone fax machines,
computers with modems attached or computerized fax servers, but not to faxes sent as
email over the Internet.
• The new rule would have required the express invitation or permission to be in writing
and include the recipient’s signature, beginning on August 25, 2003, and would have
eliminated the existence of an established business relationship as evidence of the
recipient’s express permission to receive unsolicited facsimile advertisements. However,
the FCC has stayed the section of the regulation that requires the signed, written consent,
as well as its determination that an established business relationship is not sufficient to
show prior express invitation or permission, and delayed the effective date to January 1,
• Thus, beginning on August 25, 2003 through January 1, 2005, express permission may be
evidenced by either an established business relationship or prior express permission.
During this period, express permission will not require written authorization. In addition,
newspapers should use the 1992 definition of an “established business relationship” (See
EBR definition section on page 3). If a newspaper chooses to rely on oral permission, it
should keep sufficient evidence that express consent was given. This evidence might
include a tape recording of a conversation between the newspaper and the fax recipient
that occurred before the facsimile was sent.
• Permission cannot be in the form of a “negative option”. For example, a newspaper
would not have the requisite permission if it sends a facsimile advertisement containing a
telephone number and an instruction to call if the recipient no longer wishes to receive
such faxes. Similarly, facsimile requests for permission to transmit faxed ads, including
toll-free opt-out numbers would violate the rule.
• Fax broadcasters (including any subsidiaries of newspaper companies that might provide
this service), who transmit other entities’ advertisements to a large number of telephone
facsimile machines, will be liable for an unsolicited fax if they are involved to a high
degree or have actual notice of an illegal use of the transmission. For example, fax
broadcasters who create or maintain the lists of facsimile numbers or who review or
assess the content of a facsimile message would be held responsible. Fax broadcasters
that demonstrate a high degree of involvement in the transmission of the facsimile
advertisement must be identified in the header of the facsimile, along with the
identification of the sender. Adequate identification in the header must include the legal
name under which the sender and/or fax broadcaster is officially registered to conduct
business, even if the sender also chooses to include its “doing business as” name or other
widely recognized name.
If you have any questions regarding compliance with the federal telemarketing rules, you may
contact René Milam, NAA’s Vice President and General Counsel at firstname.lastname@example.org or 703-902-
August 21, 2003