August 2003                       return to the newsletter contents page

Companies Need Written Permission Before Sending Faxed Advertisements to Customers and Others

Effective August 25, 2003, it will be unlawful under the federal Telephone Consumer Protection Act (“TCPA”) for a business (or any other entity or person) to send an unsolicited “advertisement” to any fax machine -- including a customer’s fax machine -- unless the customer or other recipient has granted the 

business prior express written permission to deliver the advertisement. This new rule is contained in regulations issued by the Federal Communications Commission and published in the July 25, 2003 issue of the Federal Register, 68 FR 44144.

An advertisement includes any material advertising the commercial availability or quality of any property, goods, or services, which for a business could include product information, special promotions, closeouts, the firm’s value-added services, sale of publications and the availability of other products or services.

Before sending an advertisement to a fax machine, the business must obtain the recipient’s signed, written statement that includes the fax number to which advertisements may be sent and clearly indicates the recipient’s consent to receive advertisements via fax from the business. Please note:

• The recipient must sign the statement. Electronic or digital signatures are acceptable if recognized as valid under applicable laws.

• The statement may not be in the form of a negative option (e.g., a faxed advertisement that contains instructions how the recipient may elect not to receive future advertisements).

Prior to this rulemaking action, a business could send faxed advertisements to any person or company with which the firm had an established business relationship. The new rules eliminate this exemption. A recipient’s signed written consent is now required.

Under the TCPA, a sender of an unsolicited fax advertisement is subject to a state court action by the recipient to recover the greater of actual monetary loss or $500 for each violation or $1,500 for each willful violation. Similar state laws may also apply. Class action lawsuits aggregating numerous individual claims are also possible where permitted by state law.

SEDA has joined with the National Association of Wholesaler-Distributors (NAW) and hundreds of other associations in petitioning the FCC to rescind this new regulation as an unnecessary and burdensome interference in existing business relationships. In the meantime, however, SEDA has sent permission forms to all members requesting permission to continue to send fax communications. Members must sign and return the form to association headquarters before August 25, 2003. After that date, SEDA will no longer be able to communication information via fax to members who do not give their permission. If you have not returned your permission form, you can download one from the SEDA website.