Delivering for Best-in-Class Wholesaler-Distributors
June 2006


The Federal Communications Commission (“FCC”) has implemented changes to the facsimile (fax) advertising rules of the Telephone Consumer Protection Act of 1991 (TCPA). The new rules: (1) specify the content and placement of the required notice that must appear on all faxed advertisements that allows recipients to “opt-out” of receiving future fax advertisements from the sender; (2) specify the circumstances under which a request to “opt-out” complies with the TCPA; (3) codify an established business relationship (“EBR”) exemption to the prohibition on sending unsolicited fax advertisements; and (4) define EBR as used in the context of unsolicited fax advertisements. The new rules appear in the Federal Register at 71 FR 25967 ( May 3, 2006) and are scheduled to take effect on August 1, 2006, or upon approval by the Office of Management and Budget, whichever occurs later.

The rules apply to all senders of fax advertisements, including trade associations, tax exempt organizations and other nonprofit entities.

Violations by a sender may result in a complaint being filed with the FCC or state authorities, or a private lawsuit filed in state court by the recipient seeking up to $1,500 in damages for each fax advertisement sent in violation of the law. Depending on state laws, class action suits may also be filed.

Key Definitions

An unsolicited advertisement is defined as any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person’s prior express invitation or permission, in writing or otherwise.

An established business relationship or EBR means a prior or existing relationship formed by a voluntary two-way communication between a person or entity and a business or residential subscriber with or without an exchange of consideration (payment), on the basis of an inquiry, application, purchase or transaction by the business or residential subscriber regarding products or services offered by such person or entity, which relationship has not been previously terminated by either party. The rules do not require that the EBR be evidenced in writing or that the recipient’s signature be obtained.

Junk Fax Prevention Act of 2005

Through the efforts of the NAW-led Fax Ban Coalition, Congress enacted the Junk Fax Prevention Act of 2005 to maintain by statute the EBR exemption which had been in effect since 1992. The Act became effective on July 9, 2005.

FCC Fax Rules and the Established Business Relationship Exemption

Generally, it is unlawful to send unsolicited advertisements to any fax machine, including those at both businesses and residences, without the recipient’s prior express invitation or permission. However, fax advertisements may be sent to recipients with whom the sender has an EBR, as long as the fax number was provided voluntarily by the recipient. Specifically, a fax advertisement may be sent to an EBR recipient if the sender also:

  • Obtains the fax number directly from the recipient within the context of the EBR, through, for example, an application, contact information form, or membership renewal form; or
  • Obtains the fax number from the recipient’s own directory, advertisement, or Internet site, unless the recipient has noted on such materials that it does not accept unsolicited advertisements at the fax number in question; or
  • If the recipient’s fax number was obtained from other sources, the sender must take reasonable steps to verify that the recipient agreed to make the number available for public distributors.

If the EBR existed before July 9, 2005, and the sender also possessed the fax number before July 9, 2005, the sender may send the fax advertisements without demonstrating how the number was obtained. In all cases the sender has the burden of establishing the existence of an EBR.

Opt-out Notice Requirements

Since July 9, 2005, federal law has required the placement of a “opt-out” notice on all faxed advertisements. The rules require senders of permissible fax advertisements (those sent with the recipient’s prior express invitation or permission, or sent to an EBR recipient) to provide specified notice and contact information on the fax that allow recipients to “opt-out” of future fax advertisements from the sender. The notice must:

  • Be clear and conspicuous and on the first page of the advertisement. [If a cover page accompanies the advertisement, the FCC encourages the sender to include the notice on the cover page as well. To be clear and conspicuous, the notice must: (1) be distinguishable from the advertising copy or other disclosures (e.g., bold print, italics, different font or the like); (2) be placed at the top or bottom of a page; and (3) be apparent to a reasonable consumer.]
  • State that the recipient may make a request to the sender not to send any future fax advertisements and that failure to comply with a valid request within 30 days is unlawful; and
  • Include a telephone number and fax number for the recipient to send the opt-out request. If neither the telephone number nor fax number is a toll-free number, a separate cost-free mechanism (e.g., Website address or email address) for a recipient to send the opt-out request must be stated in the notice. These numbers and cost-free mechanism must permit recipients to make opt-out requests 24 hours a day, 7 days a week.

Senders that receive a request not to send further fax advertisements that meets the requirements listed in the next section must honor that request within the shortest reasonable time from the date of such request, not to exceed 30 days. They are also prohibited from sending future fax advertisements to the recipient unless the recipient subsequently provides prior express permission to the sender.

Opt-out Requests By Recipients

To stop unwanted fax advertisements, a recipient’s “opt-out” requests must identify the fax number or numbers to which the request relates, and be sent to the telephone number, fax number, Web site address or e-mail address identified on the fax advertisement. The recipient can subsequently grant express permission to receive faxes from a particular sender, in writing or orally.

State Junk Fax Laws Still Apply

The TCPA and the FCC rules do not preempt any state law that imposes more restrictive requirements or regulations on, or prohibits the use of, a fax machine to send unsolicited fax advertisements. Generally a state law may only apply to intrastate faxes (fax originated and received in the same state). About 34 states have enacted some form of junk fax law.

Example of Opt-Out Notice

The FCC did not provide “safe-harbor language” for senders of fax advertisements to use in order to meet the opt-out notice requirements. At the present time, on advice of counsel, NAW and its affiliated organizations will include the following notice at the top or bottom of the first page of a fax advertisement and also on any accompanying cover page.

If you wish to discontinue receiving future faxed advertisements from this sender, send your opt-out request to us by email at [email address], by fax at [fax number], or by telephone at [telephone #]. Specify the telephone number(s) of the fax machine(s) covered by your request. As required by law we will comply with your request within the shortest reasonable time not to exceed 30 days.

Caution: A business or other organization needs to consult its legal advisors concerning the TCPA and the FCC rules, including the new opt-out notice requirements, to be assured it meets the needs of your operations and you are in compliance with its provisions. Of equal importance is your organization’s compliance with state laws applicable to unsolicited fax advertisements. By providing the above example notice, which is subject to ongoing review and modification if warranted, NAW is not representing or guaranteeing to the reader that use of the above notice on an unsolicited fax advertisement will immunize your organization from any federal or state law claims.