Do Not Call, it could be expensive
Thursday, April 26, 2007/
The Do Not Call register is five weeks away. It affects most businesses, not just telemarketers. By LUCINDA SCHMIDT.
By Lucinda Schmidt
The Federal Government’s Do Not Call Register has been met with an overwhelming public response, with over 50,000 people submitting their numbers for registration within hours of its launch on 3 May.
The big start, which threatened to crash the donotcall.gov.au website, suggests business community will have no choice but to come to terms with the limitations and costs associated with the Do Not Call register when it comes into effect on 31 May – or suffer penalties for failing to do so.
Business will be hit with expensive fees, more administration and substantial compliance costs under the new regime says Nicholas Campbell, the director of corporate and regulatory affairs at the Australian Direct Marketing Association (ADMA).
“It will have a significant impact on any business, large or small, that uses telemarketing,” Campbell says. “The whole of industry is holding its breath.”
Part of the reason for the breath-holding is that, with four weeks to go, some basic details are still to be finalised. Business groups are also anxious about how the Australian Communications and Media Authority (ACMA), which is responsible for establishing and overseeing the Do Not Call register, will deal with several grey areas.
The first thing to remember is that the new rules are not restricted to professional telemarketers. They also apply to a business that contracts a telemarketing company to make calls on its behalf, or a business that calls its own customers directly.
The basic rule is that you cannot call a phone number listed on the register to sell goods, services, land, investment or business opportunities. (Only home and mobile numbers are on the register; business numbers cannot be listed).
If you do, there are penalties, ranging from a formal warning to a fine. The minimum fine is $1100, and the maximum (for repeat offenders) is $1.1 million, although industry observers suggest that ACMA is likely to allow a “settling in” period of perhaps three months.
There are some exemptions. The clearest of these are product recalls, appointment rescheduling or chasing bills. (The fact that these types of calls have to be specifically exempted should ring warning bells about how careful you must be when contacting customers).
There’s also an exemption for the organisations that are responsible for the vast majority of telemarketing calls – charities, educational and religious groups, political parties, government bodies and market and social researchers – causing many to wonder just how effective the Do Not Call register will be in protecting consumers from unwanted calls.
Another exemption – which is one of the grey areas – is consent. If you have an existing business relationship with the customer, the rules say this gives implied consent for you to make calls that would otherwise be banned.
A spokesman for ACMA gives the example of a bank contacting its customers about banking products and services. But he declines to comment directly on whether, for example, a window-cleaner who rings a customer to see if they want their windows done again, or a phone call to a regular customer about a new product or service, would fall within the implied consent exemption.
“Whether or not there is inferred consent to receive a telemarketing call will be determined according to each particular set of circumstances,” he says. “The extent of the person’s consent will depend on what can be reasonably inferred from the conduct and the relationship.”
“The detail is where people will get caught,” says ADMA’s Campbell. “It’s all about consent.”
He says it is far better for businesses to get written consent from their clients, agreeing to be contacted for certain purposes. And make sure there is a specified period for the consent (such as 12 months or two years) otherwise the rules say the consent automatically lapses after three months.
If you don’t have implied or written consent, you will need to check customers’ home or mobile numbers against the register, before you make any marketing calls.
The idea is that you submit your customer calling list to ACMA through the Telemarketer Access Portal (which ACMA says will be up and running by May 25). The portal checks your list against the register, and returns your list with forbidden numbers flagged or deleted.
The process is known as “washing” the list – and there is a fee. Beyond the 500 calls each subscribing business can have washed for free there is tiered fee structure, with charges starting at $71 per year to have 20,000 calls washed and ranging up to $80,000 for 100,000,000 calls.
And if think that you couldn’t possibly need more than 500 calls per year, keep in mind that the “wash” only lasts 28 days. So if you have 50 customers you’d like to call each month, that will be 600 records washed in a year, so you’ll have to pay for the last 100.
“The fees are expensive,” Campbell says. “The Government has adopted a high cost model compared to registers in the US and UK where the list is made available to businesses, here businesses have to go to a service provider to have there numbers washed and obviously that drives up costs.”
But wait, there’s more. Even if the customer’s number is not on the register, or they have consented, you are not entirely off the hook. New national standards are coming in, as part of the same package, restricting the times you can make marketing calls (see panel, below).
It’s a lot to get your head around, and – with just five weeks to go – some question whether ACMA’s mad scramble to get the register up and running will be successful. Campbell notes that similar registers in the US and UK had significant teething problems.
“It will be a matter of wait and see,” he says. “Businesses do need to get across the detail, and exercise some caution if they want to contact their customers. But the legislation is not supposed to stop contact between business and their customers. Telemarketing continues to be a legitimate business tool to attract new customers and retain existing ones, but you do need to be careful how you go about it.”
What to do
- Get across the detail (see www.acma.gov.au/donotcall).
- Make sure you “wash” your customers’ home and mobile phone numbers before you make marketing calls.
- If you buy a list, make sure it has been washed through the Do Not Call register.
- Ask customers to sign a written consent for you to call them, and for a specified period, such as for two years.
- If you use an external telemarketing firm, make sure the contract requires them to comply with the new rules.
- Only make marketing calls between 9am and 8pm on weekdays and 9am and 5pm on Saturdays. Do not call on Sundays or national public holidays.