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FCC Issues Final Cramming Rule - Seeks Comments on Applicability to Wireless

On May 24, 2012, the FCC issued a final rule amending its existing Truth-in-Billing rules.

On May 24, 2012, the FCC issued a final rule amending its existing Truth-in-Billing rules. The new rule is designed to help consumers prevent unauthorized charges on their telephone bills. This rule applies only to landline ("wireline") telephone carriers.

The new rules provide that:

  1. Wireline telephone carriers must clearly and conspicuously inform their customers about the blocking options that they offer. If a wireline telephone company offers customers the option to block third-party charges, this option must be clearly stated on the company's bills, web sites, and at the point of sale;
  2. Wireline telephone carriers that place third party charges on their telephone bills must place the third party charges in a distinct bill section separate from the carrier charges; and
  3. Wireline carriers that place third party charges on their bills must provide separate subtotals for carrier and third party charges.

Additionally, the FCC is seeking comments on a proposed rule that would impose further measures to prevent cramming, including possible restrictions on third-party billing on wireless service. The notice of proposed rulemaking seems largely focused on the possibility of instituting an opt-in requirement for wireline carriers.

Take away: Given the industry changes on third-party billing the FCC's final rule is essentially irrelevant. The FCC's apparent attempt to now regulate third-party wireless billing, despite existing controls and industry practices, appears to be misguided. However, service providers that use such a billing platform need to closely monitor the FCC's activities in this regard and consider submitting comments identifying why such rulemaking is not necessary.

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