SIIA URGES FTC: RECONSIDER PROPOSED RULE CHANGE.

The Software & Information Industry Association (SIIA) submitted comments to the Federal Trade Commission (FTC) recently in response to a Notice of Proposed Rule Making on the Telemarketing Sales Rule (TSR). SIIA is concerned that there are multiple components that could cause an unnecessary and inappropriate burden on businesses, particularly discriminating against software and digital content businesses.

In the comments, SIIA President Ken Wasch urged the FTC not to except "Internet services" and "Web services" from the existing business-to-business exemption regarding telemarketing. Recognizing that this proposed change in the rule is intended to prevent Web site cramming, Wasch noted that new developments in the delivery of software and digital content would be unfairly discriminated against.

"Ultimately, if this change is implemented, it will punish a large community of legitimate digital code and content companies in an attempt to combat fraud," said SIIA President, Ken Wasch. Noting that this change would also prove inefficient and inconvenient for the small businesses it seeks to protect, Wasch recommended that the FTC abandon this approach and refocus its efforts to combat Web site cramming targeted at small businesses.

Also in the comments, SIIA warned of other adverse consequences of the proposed change in rule as drafted. Particularly the combination of proposed changes in the definition of outbound calls and disregarding pre-established business relationships could have a debilitating impact on the software and digital content industry.

The TSR was adopted by the FTC as a result of the Telemarketing Consumer Fraud and Abuse Prevention Act, enacted in 1994, to prohibit specific deceptive and abusive telemarketing acts or practices, require disclosure of certain material information, require express verifiable authorization for certain payment mechanisms, set record keeping requirements, and specify those transactions that are exempt from the TSR.