Douglas H. Green
Dear Mr. Green: This is in response to the above-referenced supplemental petition submitted by the Direct Marketing Association (DMA) requesting that the Federal Trade Commission "stay until October 1, 2003, the date by which it will require full compliance with two provisions of the safe harbor to the Abandoned Call Rule: the provision that requires telemarketers to employ technology to ensure abandonment of no more than three percent (3%) of all calls answered by a person, measured per day per calling campaign, § 310.4(b)(4)(i), and the safe harbor's record keeping provision, § 310.4(b)(4)(iv), to the extent that it would require record keeping to document compliance with the 3% abandonment rate requirement." In support of its supplemental petition, the petitioner has attached copies of affidavits containing information that was not previously submitted to the Commission either in the rulemaking proceeding or in DMA's initial petition for a stay of the amended Rule. As stated in the Commission's March 14, 2003, response to DMA's initial petition involving this issue, "the Commission accepts the proposition that predictive dialers are an important feature of viable telemarketing operations, and that the use of this equipment may inevitably result in some abandoned calls. Therefore, the ability to meet all the requirements of the safe harbor is critically important." Petitioner's supplemental affidavits, particularly those from manufacturers of predictive dialer equipment and call centers, indicate that without a stay of the abandoned call provision, some telemarketers may face the difficult choice of either operating without being compliant with the amended TSR or closing their doors until they are compliant. Upon consideration of this newly submitted information, the Commission is persuaded that some telemarketers may be unable, despite their best efforts, to comply with the 3% abandonment rate standard of the call abandonment safe harbor provision by the current effective date of March 31, 2003. The Commission considers the request for a stay in light of the reasons for implementing the amended Rule provisions. Evidence on the record establishes that abandoned calls "frighten consumers, invade their privacy, cause some of them to struggle to answer the phone only to be hung up on, and waste the time and resources of consumers working from home." 68 Fed. Reg. 4580, 4642 (Jan. 29, 2003) (footnotes omitted). The Commission therefore determined that the abandoned call provisions of the amended TSR are necessary to remedy the abusive practice of call abandonment that can result from the use of predictive dialers. Upon consideration of all information in the record, however, including the newly submitted affidavits, the Commission concludes that the economic harm to industry that is likely to occur from the cessation of telemarketing narrowly outweighs the harm to consumers of a brief delay in implementing the abandoned call provision. Therefore, the Commission has determined that it will stay the date by which it will require full compliance with the abandoned call prohibition, § 310.4(b)(1)(iv), and its safe harbor, §§ 310.4(b)(4)(i)-(iv), until October 1, 2003.(1) Given the impact on consumers of abandoned calls, the Commission encourages the industry to use its best efforts to come into full compliance with the abandoned call provisions as soon as possible. After six months (i.e., October 1, 2003), the Commission believes that the balance of equities weighs in favor of preventing further consumer harm by requiring compliance with the abandoned call provisions; and, therefore, it is unlikely that the Commission will provide a further stay of their implementation. Staying these provisions for six months should provide ample time for all telemarketers who use predictive dialers to obtain, install, and test the necessary hardware and/or software. By direction of the Commission. Donald S. Clark |
