SENATE BILL REPORT

EHB 2299

BYRepresentatives Crane, Jacobsen, Todd, Heavey, Brekke, P. King and Phillips

Regulating telefacsimile messages for commercial solicitation.

House Committe on Energy & Utilities

Senate Committee on Energy & Utilities

Senate Hearing Date(s):February 15, 1990; February 20, 1990

Majority Report:  Do pass as amended.

      Signed by Senators Benitz, Chairman; Bluechel, Vice Chairman; Owen, Stratton, Sutherland, Williams.

Senate Staff:David Monthie (786-7198)

                  February 20, 1990

AS REPORTED BY COMMITTEE ON ENERGY & UTILITIES, FEBRUARY 20, 1990

BACKGROUND:

A telefacsimile machine (or "fax" machine) is a device that is capable of receiving, and copying onto paper, reasonable reproductions or facsimiles of documents and photographs that have been transmitted over telecommunications lines.  Depending on the type of machine and the amount of detail in the message, it may take over a minute to transmit a single letter size page.  Fax machines generally can respond to only one call at a time.  If the machine is busy, a subsequent transmission from another fax machine will receive a busy signal.

As fax machines have become more widely available, there has been an increasing number of complaints about the receipt of unsolicited advertising through these machines.  There are firms that collect and sell "fax" numbers to direct marketing associations for such use.  Businesses or offices that use fax machines heavily may often find their machines inconveniently tied up with unsolicited and unwanted advertising materials.

During the past two years, at least 22 states considered, and at least six states adopted, legislation prohibiting unsolicited advertising over fax machines.  Some states have prohibited solicitation without prior authorization of the machine owner.  Others have prohibited solicitations once the machine owner notifies the solicitor that the solicitations are unwelcome.  Other restrictions allow unsolicited transmissions of limited length only between 9 p.m. and 6 a.m.  At least three states authorize imprisonment for violations of their statutes.  Federal legislation has also been introduced in the House of Representatives.

The Council on State Governments (CSG) has prepared suggested legislation for states that wish to enact restrictions on unsolicited advertising by fax machine.  The CSG recommendation would prohibit unsolicited advertising unless the two parties had a prior business relationship.  The CSG model legislation would permit solicitations of five pages or less sent between 9 p.m. and 6 a.m., regardless of whether there has been a prior business relationship, but no solicitations could be sent to a recipient who had notified the solicitor that the advertising was not wanted.  The CSG recommends a penalty of up to $100.

The Washington Consumer Protection Act (RCW 19.86) prohibits unfair methods of competition and unfair or deceptive acts or practices.  The Attorney General is authorized to initiate proceedings to prohibit violations of the Consumer Protection Act.  A person who is injured by a Consumer Protection Act violation may obtain monetary damages and reasonable attorneys' fees.  The court may also award treble damages.

SUMMARY:

With some exceptions, a person shall not promote goods or services by telefacsimile message without the prior approval of the recipient.  Exceptions are made for (1) solicitations received between 9 p.m. and 6 a.m. that are five pages or less in length; and (2) solicitations sent to persons with whom the solicitor has had a prior contractual business relationship.  No transmissions may be sent to a recipient who has notified the solicitor in writing or by telefacsimile message that the solicitations are unwanted.  No unsolicited transmission may be sent to a recipient that the sender knows, or reasonably should have known, is a governmental entity.

It is a violation of the Consumer Protection Act (RCW 19.86) to make an unsolicited transmission of promotional materials in violation of this act.  Damages available to the recipient are the greater of $500 or actual damages.

The authority of the Utilities and Transportation Commission to adopt additional rules regulating telefacsimile messages is not affected.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested

SUMMARY OF PROPOSED SENATE AMENDMENT:

The striking amendment eliminates the exemption for fax messages of up to five pages between 9 p.m. and 6 a.m., and makes technical changes to the provisions regarding violations of the Consumer Protection Act.

Senate Committee - Testified: Representative Crane (pro); Joe Daniels, Direct Marketing Association (pro); Paula Selis, Attorney General's office (pro); Trevor Sandison, Washington Bankers Association (pro)