FCC acts on do-not-call complaintsmortgagepress.comdo-not-call regulations, unsolicited commercial faxes, compliance
The Federal Communications Commission has extended the stay on
the Do-Not-Call rules from Dec. 31-June 30, 2005. The rules, aimed
at curbing unsolicited commercial faxes, were deemed "flawed" and
"overly broad" in an industry letter to Congress. The National
Association of Mortgage Brokers was one of the signers of the
letter, detailed below, and part of the coalition requesting the
June 21, 2004
Open Letter to All Members of the House of Representatives
The undersigned urge Congress to pass legislation to remedy a
flawed rule adopted by the FCC that will interfere with ongoing
business communications. While the volume of e-mail has
dramatically increased, faxes remain an important part of business
communications, especially for small businesses. The FCC badly
erred, and threatened great economic harm, when it adopted an
overly broad rule restricting the sending of commercial faxes. If
not reversed by Congress by Dec. 31, the FCC's new rule will have a
severe impact on the ability of businesses and trade associations
to use faxes to reach their customers (consumer and business
entities), subcontractors, suppliers and members. It is critical
that Congress enact the Upton-Markey-Barton-Dingell bill that will
restore an "established business relationship" exception to the
general rule against the sending of unsolicited advertising faxes.
We urge you to support this measure.
After 10 years of experience with the present established
business relationship rule and in the absence of any evidence that
it was not working well, the FCC has inexplicably issued new
regulations that would substantially change the rules for
businesses using faxes to communicate with other businesses and
their customers. Specifically, the FCC ruled that a business cannot
fax commercial information to any person, whether a subcontractor,
supplier, or exiting customer, without first obtaining the
recipient's written and signed consent. The same rule would even
forbid a trade association to send faxes to its members. Businesses
and trade associations filed numerous petitions for postponement of
the effective date of the regulations and urged the FCC to revise
its rules. The FCC agreed to postpone the effective date, delaying
implementation of the new regulations until Saturday, Jan. 1, 2005.
But without congressional intervention, the new regulations are
likely to go into effect with no substantial change.
If the FCC's rule goes into effect, it will have a harsh impact
on business communications, without providing any tangible benefit
to consumers. The rule adopted by the FCC is unnecessary--no one
identified faxes to existing customers as a problem that needed to
be "solved." While the rule has no public interest benefit, it
would severely disrupt regular business communications. Its
economic costs and burdens include the following:
•In a recent survey of its small business members
(three-quarters of the respondents having fewer than 20 employees),
the U.S. Chamber of Commerce found that the cost of the new rule to
the average small business would be at least $5,000 in the first
year and more than $3,000 per year thereafter.
•Small business owners indicated it would take, on average,
more than 27 hours of staff time to gather all of the forms
containing written consent and 20 more hours each year to keep the
•Nearly two-thirds of small businesses would be required to
obtain written consent for more than 100 separate fax numbers in
the first year of implementation. For many small businesses, the
number of required consents would be in the thousands. Some very
small businesses would be required to invest in software to obtain
and maintain consent records.
•The impact on larger businesses is exponentially greater.
Many large companies deal with hundreds of thousands of existing
customers, and the costs of obtaining and maintaining individual
written consent forms for each fax number used to communicate with
each customer would be overwhelming.
•Other negative impacts reported in the chamber's survey
include an increase in the time it takes to complete projects (84
percent of respondents), decreased communications with customers
(79 percent), the loss of potential business opportunities (66
percent), and the loss of existing customers (44 percent).
•Again, the impact on larger companies in these areas would
be similar in scope and far greater in economic impact. The result
would be huge increases in the cost of doing business.
To make sure that the FCC's ill-advised rule does not interfere
with the flow of necessary business communication, business and
trade groups need Congress to enact the Upton-Markey-Barton-Dingell
legislation this year. We urge you to promptly pass HR 4600.
For more information, visit www.namb.org.