Recent FCC Orders Implementing the TRACED Act

TCPA Connect

In 2019, Congress passed the Telephone Robocall Abuse Criminal Enforcement and Deterrence Act—or TRACED Act (Act)—with the goal of complementing the now decades-old Telephone Consumer Protection Act (TCPA) to stem the tide of so-called illegal robocalls. The Federal Communications Commission (FCC), which is responsible for promulgating implementing regulations for both the TCPA and the new Act, issued two key orders in late 2020 that may impact many TCPA Connect readers.

The first order (FCC 20-186) implements Section 8 of the Act, which impacts a number of existing TCPA exemptions for calls to residences—i.e., “(1) non-commercial calls to a residence; (2) commercial calls to a residence that do not include an advertisement or constitute telemarketing; (3) tax-exempt nonprofit organization calls to a residence; and (4) HIPAA-related calls to a residence”—with the main thrust being the imposition of limits on the number of calls that can be placed in certain spans of time. Previously, there was no limit on the number of non-telemarketing robocalls any caller could make to a residence.

More specifically, for the first three exemptions, the order limits the number of exempted calls to three artificial or prerecorded voice calls within any consecutive 30-day period. As for Health Insurance Portability and Accountability Act (HIPAA)-related calls to a residence, the order limits the number of calls to one per day, up to a maximum of three per week, within any consecutive 30-day period. It also requires callers to allow recipients to opt out of calls made pursuant to each of these four exemptions. Importantly, however, the FCC explained that these opt-out requirements do “not apply to those artificial or prerecorded voice message calls that are made for an ‘emergency purpose’ or with the prior express consent of the called party….” In any event, this order sets forth a six-month implementation period that begins once the Office of Management and Budget approves the rules.

Beyond the foregoing, the FCC merely affirmed its existing approach regarding exempted noncommercial calls to a residence in this order; specifically, that qualified callers would be “any caller that is not calling for a commercial purpose” and the qualified called parties would be “residential telephone users.” Likewise, for exempted commercial calls to a residence that do not constitute telemarketing, the FCC affirmed its existing approach that the qualified called parties would be residential telephone users. For exempted calls from a tax-exempt nonprofit organization to a residence, the FCC affirmed its existing approach that the qualified callers would be “tax-exempt nonprofit organizations” and the qualified called parties would be residential telephone users. And finally, for exempted HIPAA-related calls to a residence, the FCC again affirmed its existing approach that the qualified callers would be a “‘covered entity’ or its ‘business associate’ as those terms are defined in the HIPAA Privacy Rule” and the qualified called parties would be residential telephone users.

However, this order does not (i) make any adjustments to the four exemptions applicable to calls made to wireless phones (e.g., package delivery calls, financial institution calls, health care provider calls and inmate calling service calls), on the grounds that these exemptions already satisfied the TRACED Act’s requirements; (ii) disturb the 1992 TCPA ruling regarding wireless carrier calls to their customers for which they are not charged, on the grounds that this issue fell outside the scope of the TRACED Act’s Section 8 reassessment requirement; (iii) address how the adopted limits on the number of exempted calls should be calculated when a business engages in different vendors placing texts or calls or when joint enterprises manage a calling or texting program; (iv) specify how the FCC expects callers that make calls or send texts to a mix of residential, wireless, business and personal-use numbers to separately treat residential telephone users for the purpose of complying with these “three call” limits; nor (v) expand any exemptions or create any new ones.

The second order (FCC 20-187) is broadly related to “call blocking issues—specifically, call blocking rules, safe harbors for telecom carriers and redress for callers whose calls are wrongly blocked.” Primarily, the order (i) mandates that “voice service providers … meet certain affirmative obligations and to better police their networks against illegal calls”; (ii) broadens “existing call-blocking safe harbors to cover network-based blocking of certain calls that are highly likely to be illegal”; and (iii) sets “rules to provide greater transparency and ensure that both callers and consumers can better identify blocked calls and ensure those that are wanted are un-blocked.”

As for voice service providers in particular, this order requires providers to 1) respond to traceback requests from the FCC, civil and criminal law enforcement, and USTelecom’s Industry Traceback Group; 2) take several required steps to mitigate illegal traffic after receiving a written notice to that effect from the FCC’s Enforcement Bureau; and 3) “adopt affirmative, effective measures to prevent new and renewing customers from using their network to originate illegal calls.” Providers must also (1) immediately notify callers when calls are blocked, (2) provide a list of calls blocked to subscribers on request, and (3) provide a status update on call-blocking disputes within 24 hours.

This order also expanded safe harbors for providers to include network-based blocking of calls that are “highly likely to be illegal and that have been identified using reasonable analytics,” so long as providers provide “sufficient human oversight and network monitoring to ensure that blocking is working as intended.” However, the FCC clarified that this extended safe harbor is different in scope than the safe harbor it adopted in August 2020, which protects carriers from liability under the FCC’s call completion rules when offering default blocking of unwanted calls to consumers on an opt-out basis. “To get the benefit of this safe harbor, a terminating [carrier] must ensure its network-based blocking targets only calls highly likely to be illegal, not simply unwanted.” Accordingly, the FCC highlighted that carriers “must have in place a process to reasonably determine that the particular call pattern is highly likely to be illegal prior to blocking calls.” If this process is adhered to, and a caller disputes the blocking in good faith, the carrier “may continue to block under this safe harbor while investigating a dispute.” If its investigation reveals that the calls are likely lawful, it “must immediately cease network-based blocking.”

Why It Matters

The TRACED Act is the new frontier of call center compliance, and now outbound callers must contend with it and the TCPA. Compliance issues like these can be tricky to navigate, so please call the experts on Manatt’s TCPA team for help.

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