July 19, 2004

Legislative Activity

July 19, 2004

U.S. Senate
Senate Office Building
Washington, DC 20510

Dear Senator:

On behalf of the American Advertising Federation, I urge you to vote in favor of S. 2603, the Junk Fax Prevention Act sponsored by Senators Gordon Smith (R-OR), George Allen (R-VA), Ernest Hollings (D-SC), John Sununu (R-NH) and John Breaux (D-LA). This bipartisan bill will restore an “established business relationship” exception to the Federal Communication's rule against the sending of unsolicited advertising faxes.

Despite the lack of any demonstrable need, the FCC has issued new regulations changing the established business relationship rule that has worked well for the last ten years. Under the Commission's proposed rule a business must obtain prior written and signed consent before faxing any commercial information to any person, be it subcontractor, supplier, or existing customer. The rule could even prevent AAF and other trade associations from sending faxes to our members. Without congressional action, the new rules are set to go into effect on January 1, 2005.

While new communications technologies such as email are being increasingly used by businesses, faxes remain an important communications medium, especially for small businesses. S. 2603 would maintain the established business relationship rule that has worked well for the past 10 years. AAF is unaware of any evidence that indicates the rule needs changing.

The FCC's proposed rule will provide no tangible benefit to consumers, but will impose a substantial burden on businesses and associations. For example:

  • After surveying its members, the U.S. Chamber of Commerce estimates that the cost of the new rule to the average small business would be at least $5,000 in the first year and more than $3,000 per year thereafter.
  • The majority of small businesses would be required to obtain written consent for more than 100 separate fax numbers in the first year of implementation. For many small businesses and, the number of required consents would be in the thousands. For AAF and many other associations, the number would be in the tens of thousands.
  • The impact on larger businesses is exponentially greater. Many large companies deal with hundreds of thousands of existing customers, and the costs of obtaining and maintaining individual written consent forms for each fax number used to communicate with each customer would be overwhelming.
  • The small business respondents to the Chamber's survey also predict an increase in the time it takes to complete projects, decreased communications with customers, the loss of potential business opportunities, and the loss of existing customers.
  • The impact on larger companies in these areas would be similar in scope and far greater in economic impact. The result would be huge increases in the cost of doing business.

The American Advertising Federation strongly urges you to vote in favor of S. 2603 as introduced.

Thank you for your consideration of our views.


Jeffry L. Perlman
Executive Vice President