Calling and Texting Regulations Tightening: FCC Adopts 1:1 TCPA Consent and Do-Not-Text Rules
At its last open meeting of 2023, the FCC voted to adopt new rules “to protect consumers from unwanted and illegal text messages and calls.” Among the changes are a new “one-to-one” consent requirement for autodialed telemarketing texts and phone calls, clarification on the applicability of the Do-Not-Call Registry to text messages, and a limited text blocking mandate. These changes are discussed in more detail below, along with an overview of additional proposals on which the FCC is seeking public comment.
The rule changes will go into effect on a rolling basis over 12 months after publication in the Federal Register. As of the date of this post, publication has not yet occurred, so affected businesses will have all of 2024 to review their current practices and update them as appropriate to comply with the new requirements.
1:1 Consent and the “Lead Generator Loophole”: Among the most significant changes adopted, the Order institutes a new requirement that, to send an autodialed telemarketing text or phone call, the texter/caller must first obtain a consumer’s prior express written consent specific to the company that will place such a text or call to the consumer’s cell phone – in other words, a 1:1 consent. In adopting this requirement, the FCC explicitly stated its intent to “close the lead generator loophole by prohibiting lead generators, texters, and callers from using a single consumer consent to inundate consumers with unwanted texts and calls when consumers visit comparison shopping websites.” Of particular importance for this consent:
- A texter/caller cannot rely on a bundled consent applicable to multiple sellers. According to the Order, “[c]omparison shopping websites can provide additional information about sellers or a list of sellers that a consumer can affirmatively select in order to be contacted,” and it does not “prescribe” the number of sellers such websites can list. However, the FCC expressly rejected a “hyperlink” list approach to identifying sellers on such websites, and was clear that “if the web page seeks to obtain prior express written consent from multiple sellers, the webpage must obtain express consent separately for each seller.”
- For consent to be considered valid, the disclosure seeking consent must be “clear and conspicuous” so the notice is apparent to a reasonable consumer, and it must comply with the ESign Act if collected online. In addition, the scope of interest in certain products or services for the consent “must be logically and topically related to that website.” The Order does not define what “logically and topically” means, but explains that “when in doubt, [companies] will err on the side of limiting that content to what consumers would clearly expect.”
- Key Takeaway: The FCC’s new TCPA restrictions described above apply only to autodialed and prerecorded calls to wireless phone numbers. But even if a company is comfortable that it is not using an autodialer, it should still evaluate other legal and business case reasons for implementing the 1:1 consent rule, including confirming compliance with do-not-call requirements under a separate TCPA provision (in addition to the Telemarketing Sales Rule and state telemarketing laws), as well as possible contractual obligations with partners in its business flows. Further, while compliance may not be required for another twelve months, it would be prudent to start A/B testing now on the most effective (and still compliant) ways to obtain 1:1 consent for each seller in scenarios where one company is capturing consent for multiple parties, and consider what new contractual provisions may be worth instituting in agreements.
It is worth noting that although the item was generally favored by all FCC Commissioners, Commissioner Nathan Simington dissented specifically to the 1:1 consent requirement, citing concerns about its impact on small businesses. In a Second Further Notice of Proposed Rulemaking (NPRM) that was included in the item, the FCC is seeking public comment on the “potential economic impact on small businesses” of the 1:1 consent rule, and whether the Commission could “clarify or refine this requirement to further minimize any compliance costs.” Initial comments on these questions, as well as other proposals in the NPRM (discussed below) will be due 30 days after the item is published in the Federal Register, and reply comments will be due 45 days after publication.
Texting and Do-Not-Call: The Order also confirmed that Do-Not-Call list protections apply to text messages, and “[t]exters must have the consumer’s prior express invitation or permission before sending a marketing text to a wireless number in the DNC Registry.” This action is the latest iteration of the FCC’s longstanding policy that texts are equivalent to calls for TCPA purposes, and consequently means that if a consumer revokes his or her consent to receive texts, a company would be required to add that number to its internal do not call list. The FCC further suggested that a single opt-out text from a consumer should be viewed as a revocation of consent for all marketing messages from a particular company, stating in the Order that the Commission disagrees “with the contention that if a consumer revokes consent for autodialed text messages from a seller on one text messaging chain, the seller can continue to send that consumer texts or calls through a different program or chain…The Commission has never bifurcated consent in such a manner and does not endorse it here.”
- Key Takeaway: As a default posture, an opt out of a telemarketing text should be treated as a request to be placed on a company’s internal do not call list. While the Order did not expressly address this question, it would be consistent with consumer expectations and consumer protection law to maintain the discretion to offer a consumer a menu of opt out options so long as there is an option to stop receiving all telemarketing calls and texts from the company.
Text Blocking: The new rules require “terminating” mobile wireless providers “to block all texts from a particular number or numbers when notified by the Enforcement Bureau of illegal texts from that number or numbers.” The Order makes clear that this mandate is intended to supplement “voluntary blocking measures by providers” and that “providers can [and are expected to] continue to block and improve their blocking going forward.”
- Key Takeaway: Companies should recognize that carriers and texting platforms may bolster efforts to block text campaigns that are viewed as spam or which are triggering high opt out rates. To avoid being blacklisted, it will be increasingly important to ensure your company has a thoughtful approach to its marketing outreach efforts to ensure that recipients are receiving communications they both want and expect. A solid consent strategy is a durable way to prepare for and manage this risk.
Additional Proposals and Requests for Public Comment. In addition to adopting the rule changes outlined above, the NPRM portion of the item also lays the groundwork for the FCC to expand on some of these rule changes, as well as consider others. Among its proposals are a possible expansion of text blocking by “originating” service providers, whether the FCC should require or incentivize providers to block texts based on reasonable analytics,” and whether it should adopt “additional protections against erroneous text blocking” such as a notification requirement if texts are blocked based on reasonable analytics.
The NPRM also seeks to update the record on text message authentication and spoofing, including the extent to which number and/or identity spoofing is currently an issue for text messages, technical standards and tools that are in use or being developed to address authentication in text messaging, and whether the FCC should require the industry to provide regular updates to the Commission on text authentication.
Additionally, the NPRM proposes to require service providers to make email-to-text service an opt-in, rather than simply encouraging an opt-in framework (as it chose to do in the Second Report and Order). It seeks comment on several questions related to the proposal.
Initial comments on the NPRM will be due 30 days after the item is published in the Federal Register, and reply comments will be due 45 days after publication.
If you have any questions about how these changes may affect your business, or are interested in filing comments, please reach out to Alysa Hutnik or Jenny Wainwright. For more telemarketing updates, please subscribe to our blog.