THE REST OF THE STORY: Here is All the Stuff the Czar Left Out About the FTC’s New (Enormous) NPRM On B2B Calling and Telemarketing

So I’ve solely been working for the Czar for every week now and the very first thing he stated once I walked in the (figurative) door was that the FTC’s new NPRM for entrepreneurs concerned in direct-to-consumer gross sales was extremely vital and that he needed me to be an knowledgeable on it instantly.

Nicely, mission completed.

I do know the Czar has already dove into the critical business-records retentions provisions—and I are inclined to agree with him on his constitutionality concerns—however information retention is solely a bit of this. (Though it is arguably the most vital piece, so remember to attain out you probably have questions—or simply to say hello or to welcome me to TCPAWorld!)

Bear in mind additionally, the present TSR designates which recordkeeping obligations fall on the telemarketer and which fall on the vendor. The Fee is proposing to change the rule to require the vendor and telemarketer to allocate recordkeeping obligations between them—undoubtedly a clause you’ll need added to your MSAs people—and if the events fail to allocate the recordkeeping obligation, then they each must comply individually. Affordable.

After all, the events can allocate their respective duties and ought to. It is going to be attention-grabbing to see how allocation of enterprise document retention performs out in the open market. On the one hand you’d anticipate events to need to punt the record-keeping necessities like a sizzling potato—you punt these proper?— on the different hand, nonetheless, a failure to fulfill a record-keeping obligation can result in exceptionally excessive penalties (bear in mind each failure to take care of information is a separate TSR violation) so maybe extra subtle events will need to preserve management over the record-keeping protocols. Then once more, since the majority of transactional-level element will likely be in the management of the marketer (not less than initially) sellers could haven’t any alternative however to belief their sellers (and their allocation provisions) to guard them. Might be fascinating to see how this performs out, and we’re comfortable to speak it by way of.

Shifting past document holding, the NPRM additionally results an enlargement on the TSR’s anti-deception provisions to use to B2B callers.

Now, on the one hand, this is a sea change. Aside from B2B callers that promote workplace cleansing provides—no, I’m critical—the TSR has by no means utilized to B2B callers. So identical to “one” is a small quantity that is nonetheless infinitely bigger than zero, the utility of any TSR provision to B2B callers is nonetheless an enormous enlargement of the rule, from one perspective.

Certainly, again in 2003, the Fee reconsidered the scope of the B2B exemption and finally determined to not modify it as a result of the Fee, in its personal phrases, needed to “move cautiously so as not to chill innovation in the development of cost-efficient methods for small businesses to join in the internet marketing revolution.”

I suppose the web advertising revolution is full, as a result of the FTC is now able to impose new guidelines on B2B callers, albeit in fairly-narrow vogue. Particularly, the NPRM requires all B2B telemarketing calls to now adjust to the TSR’s present prohibitions on misrepresentations articulated in Sections 310.3(a)(2) and 310.3(a)(4).

As a refresh, Part 310.3(a)(2) prohibits companies from making misrepresentations in the sale of a great or service and Part 310.3(a)(4) prohibits an individual from making a false or deceptive assertion to induce any particular person to pay for items or companies or to induce a charitable contribution.

In different phrases, the FTC is banning lies in the context of B2B gross sales. Fairly powerful to argue with this enlargement says the Baroness. In my thoughts, this is a great factor. We ought to be making an attempt to stop misleading advertising practices, whereas implementing extra sincere ones.  However you probably have questions or considerations this is a “speak now or forever hold your peace” kind of factor. So tell us for those who’d wish to touch upon the new rule earlier than it takes impact.

Lastly, the Fee proposes including a definition of “previous donor” apparently to effectuate its authentic intent in the 2008 TSR Amendments. The Fee’s authentic acknowledged intent was to permit robocalls solicitating charitable donations on behalf of a specific non-profit charitable group solely to shoppers who’ve an established relationship with that group. Though the 2008 TSR Amendments make it clear that the Fee supposed “previous donor” to imply a donor who has beforehand offered a charitable contribution to a specific non-profit charitable group, the Fee didn’t embrace a definition of the time period “previous donor” to explicitly impact that intention. Moreover, as a result of the 2008 TSR Modification could possibly be misinterpreted as permitting a telemarketer to ship robocalls to any shopper it has beforehand solicited for a donation on behalf of a non-profit charitable group, no matter whether or not the shopper truly agreed to donate to that charitable group, the proposed definition of “previous donor” helps clarifies this.

The proposed definition additionally provides that the shopper will need to have made a donation to the non-profit charitable group inside the two-years prior instantly previous the date of the robocall. That’s a reasonably luxurious timeframe—the EBR for normal advertising calls is merely 18 months.

Notably, the “previous donor” rule wouldn’t apply to political campaigns. Political solicitations usually are not coated by the TSR in any respect.

So, there you go. Massive adjustments afoot, though the document-retention points the Czar already coated are the actually huge take away right here.

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