HBA-MSH, CCH H.B. 472 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 472 By: Solomons Business & Industry 7/18/2001 Enrolled BACKGROUND AND PURPOSE Prior to the 77th Legislature, consumers nationwide lost an estimated $40 billion each year through telemarketing fraud, and often complained that telemarketers invaded their privacy and irritated them with numerous or aggressive solicitations. Some calls violated the state mandated self-imposed no-call list that was maintained by solicitors as well as violating the state time restrictions on solicitations. House Bill 472 creates the Texas Telemarketing Disclosure and Privacy Act to set forth provisions to protect consumers from unwanted telemarketing calls and to penalize telemarketers in violation of the provisions. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Public Utility Commission in SECTION 1 (Section 43.103, Business & Commerce Code) and SECTION 4 of this bill. ANALYSIS House Bill 472 amends the Business & Commerce Code to create the Texas Telemarketing Disclosure and Privacy Act to provide for the regulation of telemarketing. The bill defines a telemarketing call and prohibits a telemarketer from blocking the identity of the telephone number from which the call is made and from interfering with the capacity of a caller identification service to provide information regarding the call. A telemarketer is required to provide caller identification information that is accessible by a caller identification service, if that capability is available. The use of a telecommunications service or equipment incapable of transmitting caller identification information does not of itself constitute interference with a caller identification service (Secs. 43.002, 43.003, and 43.051). The bill specifies the types of calls that are not subject to this bill, including calls between a telemarketer and a business, a call made by a consumer as a result of a solicitation or advertisement, in connection with an established business relationship, to collect a debt, regarding a security, or by a state licensee under certain conditions (Secs. 43.002 and 43.003). The Public Utility Commission (PUC) is required to establish a telemarketer no-call list that contains the telephone numbers of persons in this state who have requested to be on the list. PUC is required to update the list quarterly. An entry on the list expires on its third anniversary but may be renewed for successive three-year periods. The bill authorizes the deletion of a telephone number from the list on the consumer's request or if the telephone number is changed. PUC is authorized to charge a person no more than $3 for a request to be on the list or to renew an entry. The bill requires PUC to make available a no-call request form and provide a toll-free number and Internet mail address for persons to call or write to obtain the form. A private for-profit publisher of a residential phone directory is required to prominently display the toll-free number and Internet mail address in the directory (Sec. 43.101). A telemarketer is prohibited from making a call to a telephone number that has been published on the lists more than 60 days (Sec. 43.102). PUC is required to adopt rules: _requiring each local exchange telephone company to inform its customers of their options regarding telemarketers through annual inserts in billing statements or a conspicuous publication in the consumer information pages of local telephone directories; _providing that a telemarketing call to a person on the no-call list is not a violation if the call is an isolated occurrence and made by a telemarketer who has in place adequate procedures to comply with the no-call provision; _providing for the dissemination of the no-call list commonly used by telemarketers; and _providing that a fee for each distribution is not to exceed $75 (Sec. 43.103). PUC is authorized to conduct an educational program to inform the public of their rights and telemarketers of their obligations (Sec. 43.103). The bill sets forth facsimile transmission regulations regarding sender information that is required to be included in the facsimile and establishes guidelines if a recipient of a facsimile solicitation requests that the solicitor not send any further transmissions (Secs. 43.151 and 43.152). House Bill 472 provides for investigations of violations and the assessing of administrative and civil penalties against violators by PUC, which has exclusive jurisdiction if the violator is a telecommunications provider, by the attorney general, and by a state agency that issues licenses if the violator is a licensee (Sec. 43.052, 43.102, and 42.153). The bill authorizes a consumer to bring a civil action or a private right of action and specifies the amount of damages the consumer may recover (Secs. 43.102 and 43.153). The bill sets forth provisions relating to the determination of the amount of a civil penalty and situations in which a penalty may be stayed (Secs 43.251 and 43.252). PUC and the attorney general are required to submit a report to the lieutenant governor and speaker of the house of representatives before December 31st of each even-numbered year. Both reports are to include a list of complaints received, a summary of enforcement efforts, and recommendations for any changes. PUC is also required to report the number of telephone numbers on the no-call list, the number of no-call lists distributed, and the amount collected for those requests and distributions (Secs. 43.201 and 43.202). The bill requires that the Texas Telemarketing Disclosure and Privacy Act be liberally construed and applied to protect the public against false, misleading, or deceptive practices (Sec. 43.005). An attempted waiver of a provision is void (Sec. 43.006). The bill requires PUC to adopt rules added by the Act before July 1, 2002. EFFECTIVE DATE January 1, 2002.