On January 27, 2025 (the “Effective Date”), the Federal Communications Commission’s (“FCC”) “1:1” consent rule for telemarketing texts and auto-dialed, i.e., robocalls and robotexts will go into effect (the “Final Rule”). The Final Rule will require consumers to provide separate, written consent for each company that wants to send the consumer marketing messages, and it closes the “Lead Generator Loophole,” a change that will significantly impact businesses that collaborate with others on joint growth initiatives, such as jointly-branded contests or giveaways.
By way of background, the Telephone Consumer Protection Act (“TCPA”) prohibits initiating “any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party” unless a statutory exception applies or the call is “exempted by rule or order by the [FCC] under [section 227(b)(2)(B)].” [1]. The FCC later added additional requirements to the TCPA as follows:
- Wireless carriers may not obtain “additional consent” from their own subscribers prior to initiating auto-dialed artificial or prerecorded voice calls to those subscribers. [2]
- Sending a single-use text message to confirm that a consumer no longer wants to receive text communication from the sender does not violate the TCPA so long as the confirmation text complies with certain limitations, including that it does not contain any marketing information. [3]
- Consumers who have provided prior express consent to receive autodialed or prerecorded calls may revoke that consent through any reasonable means. [4]
The Final Rule adds to this list. The 1:1 consent requirement will require texters and callers first get a consumer’s written consent specific to the company before sending any text or phone call. Previously, the “lead generator loophole” allowed a business to obtain a consumer’s consent to receive marketing text messages by including a hyperlink with a list of hundreds of “partners” in the consent language. In other words, the loophole allowed any number of businesses to send marketing messages to consumers who had only consented to receive messages from a single entity, which subjected the consumer to messages from any number of “partners.” The Final Rule’s language on this point provides:
“The term prior express written consent means an agreement, in writing, that bears the signature of the person called or texted that clearly and conspicuously authorizes no more than one identified seller to deliver or cause to be delivered to the person called or texted advertisements or telemarketing messages using an automatic telephone dialing system or an artificial or prerecorded voice. Calls and texts must be logically and topically associated with the interaction that prompted the consent, and the agreement must identify the telephone number to which the signatory authorizes such advertisements or telemarketing messages to be delivered.”
Looking at this revised language, a business that obtains 1:1 consent to send automated marketing text messages cannot rely on that single consent to apply across multiple businesses/sellers. The FCC stated, “With this requirement, we make it clear that sharing lead information with a daisy-chain of ‘partners’ is not permitted.”
Importantly, the FCC did not do away with a business’s ability to procure more than one business consent at a time. The FCC noted, “Comparison shopping websites can provide additional information about sellers or a list of sellers that a consumer can affirmatively select in order to be contacted,” adding that there is no prohibition on the number of sellers the website can list. However, a business cannot use a hyperlink to identify the sellers. In other words, if a business seeks to obtain prior express written consent from multiple other businesses, it must provide additional information about other businesses or a list of businesses site visitors can affirmatively select to consent to be contacted. If multiple brands collaborate to obtain consent, the consumer must be given the opportunity to select which brands the consumer wishes to receive text messages and be presented with each brand’s terms and conditions and privacy policy at the time of consent.
A valid multi-brand consent request may look something like this:
In addition, to collect consent across multiple brands:
- The consent request must be “clear and conspicuous” to be reasonable to a consumer.
- If the consent is collected online, it must comply with the ESign Act, which governs electronic signatures that can include “an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person intending to sign the record.” To opt-in to text messages, check a box, enter a one-time passcode, or reply to “Y” are valid types of consent.
- The businesses/brands “must be logically and topically related,” which means that a consumer giving consent to a car warranty website does not consent to get robocalls/texts about car loan consolidation.
The Final Rule also confirmed that businesses must have a consumer’s prior express invitation or permission before sending a marketing text to a wireless number registered on the National Do Not Call Registry, which aligns with the FCC’s position that texts are equivalent to phone calls under the TCPA. It follows that if a consumer revokes consent to receive texts, the business would have to add that number to its internal do-not-call list and ensure it ceases all marketing communications to that number.
With the 1:1 consent rule going into effect on January 27, 2025, businesses should start taking steps to comply, including the following:
- Identify consumers obtained in a manner not in line with the 1:1 consent requirement and either obtain new consent or remove the contact from the business’ robocall/text marketing list.
- Review and revise current consumer-facing consent disclosures to align with the 1:1 consent requirement.
- Determine if other businesses are sending marketing text messages to their consumers based on consent that does not align with the 1:1 consent requirements. If necessary, notify those partners or revise the underlying brand partnership contracts.
- Determine an appropriate implementation method to ensure consumers only consent to one business at a time, or that consent is obtained per the 1:1 consent rule.
Please note that the Final Rule has been appealed by a marketing group, and an oral argument is scheduled for December in the 11th Circuit, meaning the Final Rule could be overturned. [5]
[1] Telephone Consumer Protection Act of 1991, Pub. L. No. 102-243, 105 Stat. 2394 (1991), codified at 47 USC § 227.
[2] See Rules and Regulations Implementing the Telephone Consumer Protect Act of 1991, CC Docket No. 92-90, Report and Order, 7 FCC Rcd 8752, 8774, para. 45 (1992) (1992 TCPA Order).
[3] See Lucas Cranor Petition for Declaratory Ruling Requesting Order Granting That Consumers Have the Right to Revoke Consent Under the Telephone Consumer Protection Act, CG Docket No. 02-278 (filed December 17, 2019).
[4] See Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Soundbite Communications, Inc., CG Docket No. 02-278, Declaratory Ruling, 27 FCC Rcd 15391, 15394, para. 7 (2012) (Soundbite Declaratory Ruling or Soundbite).
[5] See Insurance Marketing Coalition Limited v. Federal Communications Commission, et al., Case No. 24-10277 (11th Cir.).
[6] See Final Rule p. 3.
[7] Letter from Margot Saunders, Senior Counsel, National Consumer Law Center, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 02-278, at 4 (Dec 1, 2023) (Joint Consumer Commenters Dec. 1 ex parte).
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