INDEPTH: TELEMARKETING
Do not call:
Hanging up on telemarketers
CBC News Online | Dec. 13, 2004
It's been an overwhelming success and eyed as a model for Canada. In the months after the American Federal Communications Commission established it's "do not call" registry in October 2003, 60 million people signed up, eager to prevent most telemarketers from contacting them at home.
The U.S. Federal Trade Commission program was designed to block about 80 per cent of telemarketing calls. Consumers register the number – home or cellphone – they want protected.
The concept is simple: if you do not want to receive calls from telemarketers, you fill out a form or call a toll-free line.
Under the legislation, companies cannot call people who have signed up unless:
- The company has done business with them within the last 1½ years or fielded an inquiry or application from them within three months.
- The person being contacted gave them signed, written consent.
- The caller has a personal relationship with the person he or she is phoning.
- The company is among certain exempted groups such as charities, polling companies and political campaigners. These groups can ring numbers on the list unless they're asked not to call again.
Telemarketers must check the registry every 90 days and scrub names from their own lists. If they contact those numbers anyway, they can be fined up to $11,000 US per call or face jail terms
The federal regulator said it received between 10,000 and 12,000 consumer complaints alleging violations of the list in the program's first 11 months.
The national registry was set up after several states introduced their own do not call lists.
The FCC took a company to court for violating the registry for the first time in August 2004. The agency accused a Las Vegas telemarketing company, Braglia Marketing Group, of making more than 300,000 calls to numbers on the registry. The company was fined more than $500,000 – although all but $3,500 of it was suspended because the company was unable to pay.
Other companies have settled without going to court after the FTC said they broke the rules. Among them, AT&T Corp. shelled out $490,000 in fines in July 2004 and Primus Telecommunications Group Inc. agreed to pay $400,000 two months later.
Canadian call
Demands for a do not call registry in Canada have grown with the success of the American program. In the spring of 2004, the CRTC - the government body that regulates the telephone industry - declined to order that a registry be set up. The commission said such a registry has merit, but it doesn't have the money or the staff to handle it.
Two private members' bills that would have established a mandatory Canadian do not call list were before the House of Commons. But an election call in May 2004 killed the legislation.
But a new bill was introduced on Dec. 13, 2004, almost six months after the Liberals won a minority government in the June 2004 election. It is modelled on the American registry.
A senior official with the U.S. Federal Trade Commission went to Ottawa on May 4, 2005 to outline details of the American registry.
"We want to give Canadians an easy and effective way to protect their privacy and stop intrusive telemarketing," Industry Minister David Emerson said in a statement.
The bill calls for fines of $1500 per person and $15,000 per business for each infraction.
Paddy Torsney – parliamentary secretary to the minister for international co-operation – says it's an important piece of consumer protection that is designed to eliminate nuisance calls. She says busy families don't have time to take unsolicited telephone pitches as they're trying to feed the kids or get them to bed.
"But the ability [for marketers] to call current customers would be a reasonable exception," Torsney told CBC News.
The bill became law on Friday, Nov. 25, 2005 – three days before the government fell.
To address the CRTC's concern that it couldn't afford to run the registry, the legislation calls for a fee to be levied on telemarketers to fund the list.
Canada's largest marketing association has welcomed the legislation. The Canadian Marketing Association has been calling for clear rules on telemarketing for years. It has maintained a voluntary do not call list since 1988. It was set up to cut down not just on phone calls from telemarketers – but also junk mail and faxes from marketers.
The database contains about 340,000 names.
But it has serious limitations. It only applies to companies that are members of the Canadian Marketing Association. There's little the CMA can do to punish violators, except kick them out of the CMA.
"Without reasonable laws regulating organizations that use the telephone to market their goods and services, the industry risks losing its right to use this valuable marketing channel to acquire new customers," John Gustavson, president of the CMA said in a statement.
Gustavson notes that the telemarketing industry employs 270,000 Canadians and generates more than $16 billion in sales a year.
Under the legislation, a parliamentary committee will meet every three years to determine if the registry is working – or if the rules should be changed to make it more effective.
The do-not-call registry is expected to be in operation by the summer or fall of 2007.
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