Pay-Per-Call Rulemaking Workshop
Federal Trade Commission
May 20 and 21, 1999
THURSDAY MAY 20, 1999
8:30 a.m. - 8:45 a.m.
8:45 a.m. - 9:00 a.m.
- Welcome; announcements Eileen Harrington, Associate Director for Marketing Practices Federal Trade Commission
9:00 a.m. - 9:30 a.m.
- Brief introductions by participants (please limit to one minute)
9:30 a.m. - 10:30 a.m.
- AUDIOTEXT OFFERED OVER TOLL-FREE NUMBERS PART I: PRESUBSCRIPTION AGREEMENTS and PINs
- Definition of PIN
- Are the proposed elements of a PIN appropriate? Should there be other requirements? Should there be a requirement regarding cancellation of a PIN or reporting a PIN as lost/stolen?
- Should a PIN be unique to a particular vendor or audiotext service?
- Who should bear responsibility for lost or stolen PINs? Should consumers bear unlimited liability for shared PINs?
- When should a presubscription agreement be deemed to be formed? After the first use of the PIN? At some other point in time?
- How should the Rule treat a presubscription agreement where the orally reported terms differ from written terms mailed with the PIN?
10:30 a.m. - 10:45 a.m.
10:45 a.m. - 12:00 p.m.
- AUDIOTEXT OFFERED OVER TOLL-FREE NUMBERS PART II: ALTERNATIVE PAYMENT MECHANISMS
- Debit cards, prepaid cards, calling cards, and other payment mechanisms not subject to the Truth-In-Lending Act (TILA) and Fair Credit Billing Act (FCBA):
- How should these types of payment mechanisms be treated under the Rule?
- Could certain types of these cards fulfill the function of a PIN under the Rule? Which ones? Why?
- What types of dispute resolution rights are needed for audiotext purchases made with these cards?
- Some commenters have suggested that at the time of a transaction a vendor may not be able to distinguish one of these cards from a credit card. Is this the case? If so, what liability should a vendor face for accepting this type of card to form a presubscription agreement?
12:00 p.m. - 12:30 p.m.
- BILLING NOTICES OF RIGHTS AND OBLIGATIONS
- How often should billing notices be sent?
- Monthly? Annually? Should billing entities have a choice?
- Should the statement be required to be sent to consumers at least once during each dispute resolution cycle (i.e., every 60 days)?
- Is there a viable alternative, such as a toll-free telephone number? Abbreviated disclosures? Disclosures in telephone directories?
- What should billing notices say
- Should the Rule provide safe harbor language?
- Discussion of proposals by participants
12:30 p.m. - 1:30 p.m.
- LUNCH BREAK
1:30 p.m - 2:45 p.m.
- INITIATING A DISPUTE UNDER THE RULE
- The definition of telephone-billed purchase.
- Should this definition be expanded to protect consumers whose telephone bills contain non-toll charges that did not result from ANI?
- Assuming the current proposal is adopted, what additional exclusions, if any, are warranted? LECs billing for their own services? Bundled services? What would be the rationale for such exclusions?
- The definition of billing error. The proposed Rule includes billing errors that some might characterize as inquiries rather than full-fledged disputes. For example, billing error #2 covers a situation where a consumer asks for additional clarification.
- Should this or other billing errors be deleted in favor of a separate Rule requirement that billing entities provide additional clarification to consumers who call to ask for it?
2:45 p.m. - 2:50 p.m.
- FIVE MINUTE LEG STRETCH
2:50 p.m. - 4:00 p.m.
- REASONABLE INVESTIGATION OF CONSUMER DISPUTES
- The rebuttable presumption of the validity of ANI (proposed footnote 4).
- How should the Rule fairly balance the interests of consumers who have been charged for calls that were not made using the consumer's telephone, against the interests of vendors who are the victims of "consumer fraud?"
- Written responses to oral complaints by consumers.
- Is there a need for a "written acknowledgment" that a dispute has been initiated (proposed 308.20(c)(1)), or is oral acknowledgment sufficient? Are there alternatives such as providing consumers with a "dispute reference number?"
- Is there a need for a "written explanation and documentary evidence" in every case where a billing entity conducts a reasonable investigation that concludes that a charge is owed? (proposed 308.20(c)(2)(ii))
- The "designated billing entity."
- Should there be differing obligations on the billing entity designated to receive and respond to billing errors? Should the other billing entities have obligations to forward complaints/inquiries to the designated entity?
4:00 p.m. - 4:15 p.m.
4:15 p.m. - 5:15 p.m.
- THE DISPUTE RESOLUTION PROCESS
- The Vendor/LEC relationship. To what extent should the Rule play a role in defining this relationship?
- Should the Rule encourage timely reporting of chargebacks to vendors? If so, how can that be accomplished?
- Why don't LECs make BNA and TDDRA-blocking information available to vendors?
- Can the Rule play a role in encouraging LECs to continue billing for 900 number services?
- Timing issues:
- Is 60 days sufficient for consumers to initiate a billing dispute? Is it too long?
- Are there other time limits that may need to be modified?
- Monthly or other recurring charges - Is there a way to protect consumers who notice a recurring charge after several months?
5:15 p.m. - 6:00 p.m.
- PUBLIC PARTICIPATION
FRIDAY MAY 21, 1999
8:30 a.m. - 8:45 a.m.
- Arrival of participants
8:45 a.m. - 9:00 a.m.
9:00 a.m. - 11:00 a.m.
- OBTAINING PROOF OF EXPRESS AUTHORIZATION
- Should any person other than the person responsible for paying the bill be permitted to provide express authorization? If so, who? (proposed 308.17 and 308.2(b)(10))
- Should the answer to this question depend on who will receive the benefit of the telephone-billed purchase?
- Should the answer depend on something else?
- Would it be appropriate to exempt any type of service from the requirement to obtain express authorization? Why or why not? For example, should any of the following be exempt?
- Blockable telephone-billed purchases?
- Services provided by a LEC or its affiliate?
- Adjunct-to-basic services such as caller-ID, call waiting, etc?
- What should constitute "documentary evidence" that there was "express authorization" for a non-blockable telephone-billed purchase (proposed 308.2(b)(10))? For example, should any of the following constitute such evidence?
- Third-party verification?
- Written agreements?
- Tape or digital recording?
11:00 a.m. - 11:15 a.m.
11:15 a.m. - 12:45 p.m.
- "KNEW OR SHOULD HAVE KNOWN" LIABILITY FOR LACK OF EXPRESS AUTHORIZATION
- "Knew or should have known" liability for vendors, service bureaus, and billing entities. (proposed 308.17)
- Should there be "safe harbor" protection, or a rebuttable presumption against 308.17 liability, if certain steps are taken (e.g. third-party verification, complaint monitoring, offering "billing block options" to consumers)?
- If so, should such a safe harbor or other protection be structured differently for vendors, service bureaus, and billing entities?
- What information "should" the billing entity, vendor, and service bureau be deemed to "know"?
- Will proposed section 308.17 prevent a "head in the sand" approach by vendors, service bureaus, and billing entities?
12:45 p.m. - 1:45 p.m.
- LUNCH BREAK
1:45 p.m. - 3:15 p.m.
- DEFINITION OF PAY-PER-CALL SERVICES
- The de minimis exemption.
- Should there be a de minimis exemption?
- If so, is there a way to draft a "bright line" rule that would exempt only those services where the vendor commission is truly de minimis?
- Are the proposed rebuttable presumptions of payment to a provider appropriate?
- What should qualify as a "directory service" for purposes of the Rule?
- "Interexchange" and "local exchange" services are exempted from the definition. What services should these terms include?
- Are there additional exemptions that would be appropriate?
3:15 p.m. - 3:30 p.m.
3:30 p.m. - 4:30 p.m.
- INTERNATIONAL AUDIOTEXT SERVICES
- Is it technologically feasible for international audiotext services to comply with TDDRA requirements to provide free preambles, to segregate audiotext charges from toll charges on the telephone bill, to provide per-minute cost disclosures, and to provide blocking?
- To the extent that barriers for international audiotext services to comply with TDDRA are financial and not technological, who would bear the cost of compliance with these provisions? LECs? IXCs?
- What prevents international audiotext providers and/or service bureaus from reaching agreements with IXCs and LECs to ensure compliance? Could international audiotext providers compensate LECs and IXCs for these services?
- Is there a way that consumers could dispute international audiotext charges that they have not authorized, or that have been incurred as a result of fraud, or that have been provided in violation of the Rule?
- The prohibition on toll charges for pay-per-call services (proposed 308.12)
- Should this provision be limited to audiotext, or should the prohibition cover the sale of other types of products/services within a regulated toll charge (i.e., "videotext")?
- Is there an alternative to an outright ban?
- Discussion of international developments. Will there be an international equivalent to the 900 platform?
4:30 p.m. - 5:30 p.m.
- Closing Remarks -- Eileen Harrington