HOUSE POISED TO MOVE ON FTC DO-NOT-CALL LIST
FTC urged House Commerce Committee Wed. to give it power to levy fees on telemarketers to fund proposed do-not-call registry. Commerce Committee spokesman Ken Johnson said House could take action to implement funding mechanism as early as today (Thurs.) through continuing resolution. During “briefing” today on Capitol Hill, FTC Chmn. Timothy Muris told committee it would take about $16 million to fund list and if Congress didn’t act soon to give FTC funding authorization, Commission wouldn’t be able to implement list this year. Committee Chmn. Tauzin (R-La.) said he was concerned about potential jurisdictional issues that could hamper FTC’s implementation of list, but Johnson said Tauzin agreed to limit authorization to 1-2 years. During briefing, Tauzin asked Muris about reauthorizing system after period of time, to which Muris replied: “It would be reasonable to assess the system after it’s up and running.” Tauzin told Muris: “You understand there are some concerns about authorizing fees for a system that’s not yet set up.”
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While most lawmakers were generally supportive of FTC’s efforts, some raised questions about details of FTC’s proposal, which was approved Dec. 18 (CD Dec 19 p4). Muris told members that FTC could begin to implement list despite fact that many jurisdictional questions can be solved only by continuing FCC proceeding. Tauzin said committee’s staff had questions about whether federal law even allowed FTC to establish list and added FTC was likely to be sued over list. When Tauzin closed briefing, he urged Muris to think about what implications list will have on $650 billion telemarketing industry and how that industry might be able to use broadband technology to reach consumers. “They're not going to just go away because people don’t want to be called,” Tauzin said.
Muris told committee that many of calls that FTC is trying to limit fall under FCC’s jurisdiction. Telemarketing for phone service and credit cards fall under FCC jurisdiction, Muris said. FTC Consumer Protection Dir. Howard Beales told us that Telemarketing Act of 1994 gives both FTC and FCC jurisdiction over telemarketing. However, FCC’s jurisdiction over telephone wires allows it to regulate telemarketing by industries over which the FTC lacks jurisdiction, such as financial institutions and telephone common carriers. Muris told committee that “an enormous number” of telemarketing calls fall under what would be FCC jurisdiction. Muris said there was communication between FTC and FCC on their do-not-call list proposals and added: “I believe the FCC is moving forward on adopting a rule that looks like ours.” Consumer Protection Subcommittee Chmn. Stearns (R-Fla.) said it was important that FTC, FCC proposals be “substantially harmonized.”
Authorization is needed soon from Congress because FTC has against Aug. deadline to assess fees in 2003 fiscal year and Muris said FTC would need 8-9 months to make list operational. While FCC action also is needed, it has more time since it won’t administering list, Muris said. Comment period for FCC do-not-call proceeding ended Wed. Muris told committee that costs would fall into 3 primary areas: (1) Development and operation of list, including handling of complaints. (2) Enforcement, including consumer and business education and international coordination. (3) Agency infrastructure and administration, including information technology structural supports.
Muris said $16 million needed to fund list (which would come from fees on telemarketing companies) could eventually reduce fees paid by telemarketers. Since 27 states have list, most of which include fees for telemarketers, consolidated national list may end up in reduction on fees to telemarketers, Muris said. FTC list could “relieve states of their burdens” to establish and maintain list, Muris said. States will be allowed access to list and there probably isn’t need for Congress to preempt states, Muris said.
Many representatives praised FTC’s efforts. Telecom Subcommittee Ranking Democrat Markey (D-Mass.) told Muris: “You have a box office runaway smash hit on your hands.” And while many members praised FTC’s efforts as victory for consumers, some members had targeted concerns. Commerce Committee Ranking Democrat Dingell (D-Mich.) said list should be “diligently enforced” and that regulators shouldn’t lose sight of cramming, spamming and other consumer annoyances. Rep. Barton (R-Tex.) said list should include political and charitable calls, but Muris said Telemarketing Act exempted those calls. And Rep. Bass (R-N.H.) expressed concerns about how list would affect telemarketing industry. “There needs to be a balance between consumers’ annoyance and an industry that employs a lot of people that would otherwise not be able to be employed,” Bass said.
Direct Mktg. Assn. said it was pleased members raised questions and concerns about list. DMA said Congress gave FCC, not FTC, authority to establish list. “The FTC acted prematurely in attempting to establish this list and is asking Congress to also act before the FCC has a chance to complete its analysis of a national do-not-call registry,” said Robert Wientzen, DMA pres. and CEO. DMA said it supports national “one-stop shopping” list that includes state lists. DMA also has do-not-call list, but when asked, Muris said list was ineffective because consumers didn’t know about it and had to dial toll line to be placed on it.