Both the FTC and FCC have provisions in their telemarketing rules governing “abandoned calls”, which are defined as calls not answered by a live person within two seconds after the called person’s greeting. If there is no live person available at the end of two seconds, then the caller must play a prerecorded message identifying the name of the entity calling or on whose behalf the call is being made as well as a telephone number for this entity. The message may not contain a sales pitch.
The FTC and FCC’s rules differ when the call is made to someone with whom the business has an “established business relationship” (“EBR”), defined as the business’s existing clients and customers as well as those with whom the business has transacted business with in the prior 18 months. The FCC rules do not define calls to those with whom the business has an EBR which are not answered by a live person within two seconds as “abandoned calls” and allows prerecorded sales calls to be made to those consumers. In contrast, the FTC rules do not make this distinction and so prerecorded sales calls are not allowed, even those with whom the business has an EBR.
In 2003, the FCC and FTC acknowledged that there was a conflict in their telemarketing rules. While the federal agencies each regulate separate industries, both sets of telemarketing rules would apply to any entity which is making interstate telemarketing calls. A telemarketer filed a petition in 2003 seeking to have the FTC resolve the conflict by declaring that a safe harbor existed for pre-recorded messages sent by the entity to consumers with whom it had an EBR. While it was considering this request, the FTC stated that it would not enforce this part of its rules while it received comments on the petition.
In October 2006, the FTC announced that it had decided to reject the petition’s call for an EBR safe harbor and would begin enforcing its ban on all prerecorded sales calls on January 2, 2007. Following this announcement, a number of other petitions were filed with the FTC seeking an extension of time to comply with the FTC’s enforcement plan. In response to those requests, the FTC announced, pending resolution of the new petitions, that it would not begin enforcement proceedings against an entity who placed a prerecorded sales call to a consumer with whom it had an EBR, so long as the entity: first, allows the consumer’s telephone to ring for at least fifteen seconds or four rings prior to disconnecting; second, within two second’s after the consumer’s greeting, the consumer is presented with the opportunity to make a company-specific do not call request; and, finally, the entity complies with all other applicable federal and state laws. Thus, businesses can make prerecorded sales calls to consumers with whom they have an EBR, but these calls should comply with the new requirements imposed by the FTC.
In summary, any business which makes interstate telemarketing calls will need to make sure that these calls comply with the FTC’s new requirements, pending further guidance from the FTC.
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