Telemarketing Sales Rule

The FTC first issued its Telemarketing Sales Rule (TSR) in 1995, implementing the

Telemarketing and Consumer Fraud and Abuse Prevention Act. It has since amended the TSR in 2003, 2008, 2010 and 2015.

Abandonment Safe Harbor

According to the FTC guidance, the abandoned call Safe Harbor provides that a telemarketer will not face enforcement action for violating the call abandonment prohibition if the telemarketer: Uses technology that ensures abandonment of no more than three percent of all calls answered by a live person, measured per day per calling campaign Allows the telephone to ring for 15 seconds or four rings before disconnecting an unanswered call Plays a recorded message stating the name and telephone number of the seller on whose behalf the call was placed whenever a live sales representative is unavailable within two seconds of a live person answering the call Maintains records documenting adherence to the preceding three requirements To take advantage of the Safe Harbor, a telemarketer must first ensure that a live representative takes at least 97 percent of the calls answered by consumers. Any calls answered by machine, calls that are not answered at all, and calls to nonworking numbers do not count in this calculation

TSR Requirements for Telemarketing Calls

Call only between 8 a.m. and 9 p.m. Screen and scrub names against the national DNC list Display caller ID information Identify themselves and what they are selling Disclose all material information and terms1 Comply with special rules for prizes and promotions Respect requests to call back Retain records for at least 24 hours Comply with special rules for automated dialers

Exceptions to the DNC Registry

DNC rules apply to for-profit organizations and cover charitable solicitations placed by for-profit telefunders. DNC rules do not apply to: Nonprofits calling on their own behalf Calls to customers with an existing relationship within the last 18 months Inbound calls, provided that there is no "upsell" of additional products or services14 Most business-to-business calls

Registration Process for Sellers

Each seller must establish a profile by providing identifying information about the organization. The seller then receives a unique Subscription Account Number (SAN) upon payment of the appropriate fee

Does TSR of DNC Preempt State Laws?

Neither the TSR nor the FCC rules preempt state law. the TCPA's preemption of interstate regulation

Existing Business Relationships

Sellers (and telemarketers calling on their behalf) may call a consumer with whom a seller has an established business relationship (EBR), provided the consumer has not asked to be on the seller's entity-specific DNC list. The TSR recognizes two distinct types of relationships: "customers" and "prospects." An EBR exists with a customer if the consumer has purchased, rented or leased the seller's goods or services (or completed a financial transaction with the seller) within 18 months preceding a telemarketing call. The 18-month period runs from the date of the last payment, transaction or shipment between the consumer and the seller. An EBR exists with a prospect if the consumer has made an application or inquiry regarding the seller's goods and services. This EBR runs for three months from the date of the person's inquiry or application

Process for Telemarketers on Behalf of Sellers

Telemarketers accessing the registry on behalf of seller-clients are required to identify the seller-clients and provide the seller-client's unique SAN. (Telemarketers access the registry, at no cost, through the use of their seller-client's unique SANs. Their access is limited to the area codes requested and paid for by the seller-client.)

Requirements on Callers in relation to the DNC Registry

The DNC Registry provisions took effect in 2003 and require sellers and telemarketers to access the registry prior to making any phone-based solicitations. They are also required to update their call lists every 31 days with new registry information.

DNC Consent Exception

The TSR allows sellers and telemarketers to call consumers who consent to receive such calls. This consent must be in writing, must state the number to which calls may be made and must include the consumer's signature. (A valid electronic signature is acceptable.) If online, the "please call me" button may not be prechecked.

Who Enforces the DNC Registry?

The FTC, the FCC and state attorneys general enforce the DNC Registry.

Junk Fax Prevention Act (JFPA)

The JFPA specifically provides that consent can be inferred from an EBR, and it permits sending of commercial faxes to recipients based on an EBR, as long as the sender offers an opt-out in accordance with the act. For purposes of the JFPA, "existing business relationship" has the same definition as it does in the FTC's DNC rule.

TSR Required Disclosures

The identity of the seller That the purpose of the call is to sell goods or services The nature of those goods or services In the case of a prize promotion, that no purchase or payment is necessary to participate or win, and that a purchase or payment does not increase the chances of winning

Applicable Phone Numbers on the DNC Registry

The program provides a means for U.S. residents to register residential and wireless phone numbers that they do not wish to be called for telemarketing purposes (with specific exceptions

Where can the DNC Registry be Accessed and by Whom?

The registry is accessed via an automated website at www.telemarketing.donotcall.gov. Only sellers, telemarketers and their service providers may access the registry.

DNC Safe Harbor

[I]f a seller or telemarketer can establish that as part of its routine business practice, it meets the following requirements, it will not be subject to civil penalties or sanctions for erroneously calling a consumer who has asked not to be called, or for calling a number on the National Registry: The seller or telemarketer has established and implemented written procedures to honor consumers' requests that they not be called, [and] The seller or telemarketer has trained its personnel, and any entity assisting in its compliance, in these procedures, [and] The seller, telemarketer, or someone else acting on behalf of the seller . . . has maintained and recorded an entity-specific Do Not Call list, [and] The seller or telemarketer uses, and maintains records documenting, a process to prevent calls to any telephone number on an entity-specific Do Not Call list or the National Do Not Call Registry. This, provided that the latter process involves using a version of the National Registry from the FTC no more than 31 days before the date any call is made, [and] The seller, telemarketer, or someone else acting on behalf of the seller. . . monitors and enforces compliance with the entity's written Do Not Call procedures, [then] The call is a result of error

The Telemarketing Sales Rule defines telemarketing as

a plan, program, or campaign which is conducted to induce the purchase of goods or services or a charitable contribution, by use of one or more telephones and which involves more than one interstate telephone call.