S 562 ISCommentsClose CommentsPermalink

To require accurate and reasonable disclosure of the terms and conditions of prepaid telephone calling cards and services, and for other purposes.CommentsClose CommentsPermalink

March 10, 2009CommentsClose CommentsPermalink

Mr. NELSON of Florida (for himself, Ms. SNOWE, and Ms. KLOBUCHAR) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and TransportationCommentsClose CommentsPermalink

To require accurate and reasonable disclosure of the terms and conditions of prepaid telephone calling cards and services, and for other purposes.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Prepaid Calling Card Consumer Protection Act of 2009’.CommentsClose CommentsPermalink

SEC. 2. DEFINITIONS.

In this Act:CommentsClose CommentsPermalink





(1) COMMISSION- The term ‘Commission’ means the Federal Trade Commission.CommentsClose CommentsPermalink





(2) FEES-CommentsClose CommentsPermalink





(A) IN GENERAL- The term ‘fees’ means all charges, fees, taxes, or surcharges, including connection, hang-up, service, payphone, and maintenance charges, which may be--CommentsClose CommentsPermalink





(i) required by State or Federal statute or by regulation or order of the Commission or a State; orCommentsClose CommentsPermalink





(ii) permitted to be assessed by a State or Federal statute or by regulation or order of the Commission or a State.CommentsClose CommentsPermalink





(B) EXCLUSION- The term ‘fees’ does not include the applicable per unit or per-minute rate for the particular destination called by a consumer.CommentsClose CommentsPermalink





(3) INTERNATIONAL PREFERRED DESTINATION- The term ‘international preferred destination’ means a specific international destination named on a prepaid telephone calling card or on the packaging material accompanying a prepaid telephone calling card.CommentsClose CommentsPermalink





(4) PREPAID TELEPHONE CALLING CARD-CommentsClose CommentsPermalink





(A) IN GENERAL- The terms ‘prepaid telephone calling card’ and ‘card’ mean--CommentsClose CommentsPermalink





(i) a card or similar device that allows users to pay in advance for a specified amount of calling, without regard to additional features, functions, or capabilities available in conjunction with a prepaid telephone calling service; orCommentsClose CommentsPermalink





(ii) any right of use purchased in advance for a sum certain linked to an access number and authorization code that--CommentsClose CommentsPermalink





(I) enables a consumer to use a prepaid telephone calling service; andCommentsClose CommentsPermalink





(II) is embodied on a card or other physical object, or purchased by an electronic or telephonic means through which the purchaser obtains access numbers and authorization codes that are not physically located on a card, its packaging, an Internet website, or other promotional materials.CommentsClose CommentsPermalink





(B) EXCLUSION- The terms ‘prepaid telephone calling card’ and ‘card’ do not include cards or other rights of use that provide access to--CommentsClose CommentsPermalink





(i) service provided for free, or at no additional charge as a promotional item accompanying a product or service purchased by a consumer; orCommentsClose CommentsPermalink





(ii) a wireless telecommunications service account with a wireless service provider that the purchaser has a preexisting relationship with or establishes a carrier customer relationship with via the purchase of a prepaid wireless telecommunications service handset package.CommentsClose CommentsPermalink





(5) PREPAID TELEPHONE CALLING CARD DISTRIBUTOR-CommentsClose CommentsPermalink





(A) IN GENERAL- The term ‘prepaid telephone calling card distributor’ means any person that--CommentsClose CommentsPermalink





(i) purchases prepaid telephone calling cards or services from a prepaid telephone calling service provider; andCommentsClose CommentsPermalink





(ii) sells, resells, issues, or distributes prepaid telephone calling cards to 1 or more distributors of such cards or to 1 or more retail sellers of such cards.CommentsClose CommentsPermalink





(B) EXCLUSION- The term ‘prepaid telephone calling card distributor’ does not include any retail merchant or seller of prepaid telephone calling cards exclusively engaged in point-of-sale transactions with end-user customers.CommentsClose CommentsPermalink





(6) PREPAID TELEPHONE CALLING SERVICE-CommentsClose CommentsPermalink





(A) IN GENERAL- The terms ‘prepaid telephone calling service’ and ‘service’ mean any real time voice communications service, regardless of the technology or network utilized, paid for in advance by a consumer, that allows a consumer to originate voice telephone calls through a local, long distance, or toll-free access number and authorization code, whether manually or electronically dialed.CommentsClose CommentsPermalink





(B) EXCLUSION- The terms ‘prepaid telephone calling service’ and ‘service’ do not include any service that provides access to a wireless telecommunications service account if the purchaser has a preexisting relationship with the wireless service provider or establishes a carrier-customer relationship via the purchase of a prepaid wireless telecommunications service handset package.CommentsClose CommentsPermalink





(7) PREPAID TELEPHONE CALLING SERVICE PROVIDER- The term ‘prepaid telephone calling service provider’ means any person providing prepaid telephone calling service to the public using its own, or a resold, network offering real time voice communications service regardless of the technology utilized.CommentsClose CommentsPermalink





(8) WIRELESS TELECOMMUNICATIONS SERVICE- The term ‘wireless telecommunications service’ has the meaning given the term ‘commercial mobile service’ in section 332(d) of the Communications Act of 1934 (47 U.S.C. 332(d)).CommentsClose CommentsPermalink

SEC. 3. REQUIRED DISCLOSURES OF PREPAID TELEPHONE CALLING CARDS OR SERVICES.

(a) Required Disclosure; Rulemaking- Not later than 180 days after the date of enactment of this Act, the Commission shall prescribe regulations that require every prepaid telephone calling service provider or prepaid telephone calling card distributor to disclose the following information relating to the material terms and conditions of the prepaid telephone calling card or service:CommentsClose CommentsPermalink





(1) INFORMATION RELATING TO DOMESTIC INTERSTATE CALLS-CommentsClose CommentsPermalink





(A) The number of calling units or minutes of domestic interstate calls provided by such card or service at the time of purchase; orCommentsClose CommentsPermalink





(B) the dollar value of such card or service and the domestic interstate rate per-minute provided by such card or service at the time of purchase.CommentsClose CommentsPermalink





(2) INFORMATION RELATING TO INTERNATIONAL PREFERRED DESTINATIONS- The applicable calling unit or per-minute rates for each international preferred destinations served by such card or service.CommentsClose CommentsPermalink





(3) Information relating to individual international destinations-CommentsClose CommentsPermalink





(A) The applicable calling unit or per-minute rates for each individual international destinations served by such card or service.CommentsClose CommentsPermalink





(B) That the applicable calling unit or per-minute rates for each individual international destination may be obtained through the prepaid telephone calling card provider’s toll-free customer service number and Internet website.CommentsClose CommentsPermalink





(C) Whether those rates fluctuate.CommentsClose CommentsPermalink





(4) OTHER MATERIAL TERMS AND CONDITIONS- Other material terms and conditions pertaining to the use of such card or service, including--CommentsClose CommentsPermalink





(A) the amount and frequency of all fees;CommentsClose CommentsPermalink





(B) a description of applicable policies relating to refund, recharge, decrement, or expiration; andCommentsClose CommentsPermalink





(C) limitations, if any, on the use or period of time for which the displayed, promoted, or advertised minutes or rates will be available to the customer.CommentsClose CommentsPermalink





(5) SERVICE PROVIDER INFORMATION- Information relating to the service provider, including--CommentsClose CommentsPermalink





(A) the name of the service provider;CommentsClose CommentsPermalink





(B) the address of such service provider, which shall be made available on the provider’s website (if any), together with the uniform resource locator address thereof; andCommentsClose CommentsPermalink





(C) a toll-free telephone number that may be used to contact the customer service department of such service provider, together with the hours of service of the customer service department.CommentsClose CommentsPermalink





(b) Clear and Conspicuous Disclosure of Required Information and Language Requirements- In prescribing regulations under subsection (a), the Commission shall require, at a minimum, that--CommentsClose CommentsPermalink





(1) the required disclosures (other than the disclosure required by subsection (a)(3)(A)) for prepaid telephone calling cards are printed in plain English in a clear and conspicuous location on the card, or on the packaging of the card, so as to be plainly visible to a consumer at the point of sale;CommentsClose CommentsPermalink





(2) the required disclosures (other than the disclosure required by subsection (a)(3)(B)) for prepaid telephone calling service that consumers access and purchase via the Internet are displayed in plain English in a clear and conspicuous location on the Internet site from which the consumer purchases such service, and include conspicuous instructions and directions to any link to such disclosures;CommentsClose CommentsPermalink





(3) the required disclosures (other than the disclosure required by subsection (a)(3)(A)) for advertising and other promotional materials are printed on any advertising for the prepaid telephone calling card or service used at the point of sale, including on any signs for display by retail merchants, displayed on any Internet site used to promote material, and on any other promotional material used at the point of sale that is prepared by, or at the direction of, any person that is subject to the requirements of this Act;CommentsClose CommentsPermalink





(4) if a language other than English is predominantly used on a prepaid telephone calling card or its packaging, or in the point-of-sale advertising, Internet advertising, or promotional material of a prepaid telephone calling card or prepaid telephone calling service, then the required disclosures are provided in that language on such card, packaging, advertisement, or promotional material in the same manner as if they were provided in English; andCommentsClose CommentsPermalink





(5) if a language other than English is predominantly used on a prepaid telephone calling card or its packaging, or in the point-of-sale advertising, or promotional materials of a prepaid telephone calling card or prepaid telephone calling service, then the customer service department reached via a toll-free number must provide basic customer support (per-minute rate or equivalent calling units for each destination, fees, and terms of service) in that language.CommentsClose CommentsPermalink





(c) Implementing Regulations- The Commission may, in accordance with section 553 of title 5, United States Code, prescribe such other disclosure regulations as the Commission determines are necessary to implement this section.CommentsClose CommentsPermalink

SEC. 4. UNLAWFUL CONDUCT RELATED TO PREPAID TELEPHONE CALLING CARDS.

(a) Prepaid Telephone Calling Service Provider- It shall be unlawful for any prepaid telephone calling service provider to do any of the following:CommentsClose CommentsPermalink





(1) UNDISCLOSED FEES AND CHARGES- To assess or deduct from the balance of a prepaid telephone calling card any fee or other amount for use of the prepaid telephone calling service, except--CommentsClose CommentsPermalink





(A) the per-minute rate or value for each particular destination called by the consumer; andCommentsClose CommentsPermalink





(B) fees that are disclosed in accordance with the regulations prescribed under section 3.CommentsClose CommentsPermalink





(2) MINUTES AND RATES AS PROMOTED AND ADVERTISED- With respect to a prepaid telephone calling card for a service of the prepaid telephone calling service provider, to provide fewer minutes than the number of minutes promoted or advertised, or to charge a higher per-minute rate to a specific domestic destination or international preferred destination than the per-minute rate to that specific destination promoted or advertised, on--CommentsClose CommentsPermalink





(A) the prepaid telephone calling card;CommentsClose CommentsPermalink





(B) any point-of-sale material relating to the card that is prepared by or at the direction of the prepaid telephone calling card service provider; orCommentsClose CommentsPermalink





(C) other advertising related to the card or service.CommentsClose CommentsPermalink





(3) MINUTES ANNOUNCED, PROMOTED, AND ADVERTISED THROUGH VOICE PROMPTS- To provide fewer minutes than the number of minutes announced, promoted, or advertised through any voice prompt given by the prepaid telephone calling service provider to a consumer at the time the consumer places a call to a dialed domestic destination or international preferred destination with a prepaid telephone calling card or service.CommentsClose CommentsPermalink





(4) EXPIRATION- To provide, sell, resell, issue, or distribute a prepaid telephone calling card that expires--CommentsClose CommentsPermalink





(A) before the date that is 1 year after the date on which such card is first used; orCommentsClose CommentsPermalink





(B) in the case of a prepaid telephone calling card or service that permits a consumer to purchase additional usage minutes or add additional value to the card, before the date that is 1 year after the date on which the consumer last purchased additional usage minutes or added additional value to the card.CommentsClose CommentsPermalink





(5) CHARGES FOR UNCONNECTED CALLS- To assess any fee or charge for any unconnected telephone call. For purposes of this paragraph, a telephone call shall not be considered connected if the person placing the call receives a busy signal or if the call is unanswered.CommentsClose CommentsPermalink





(6) MAXIMUM BILLING INCREMENTS- To assess or deduct a per-minute rate (or equivalent calling unit) in an increment greater than 1 minute of calling time for calls that are less than 1 full minute. It shall not be a violation of this section for a prepaid telephone calling service provider to deduct different destination-specific rates (or equivalent calling units) for each full minute of calling time in accordance with properly disclosed rates or other terms and conditions.CommentsClose CommentsPermalink





(b) Prepaid Telephone Calling Card Distributor- It shall be unlawful for any prepaid telephone calling card distributor to do any of the following:CommentsClose CommentsPermalink





(1) UNDISCLOSED FEES AND CHARGES- To assess or deduct from the balance of a prepaid telephone calling card any fee or other amount for use of the prepaid telephone calling service, except--CommentsClose CommentsPermalink





(A) the per-minute rate or value for each particular destination called by the consumer; andCommentsClose CommentsPermalink





(B) fees that are disclosed as required by regulations prescribed under section 3.CommentsClose CommentsPermalink





(2) MINUTES AS PROMOTED AND ADVERTISED- To sell, resell, issue, or distribute any prepaid telephone calling card that the distributor knows provides fewer minutes than the number of minutes promoted or advertised, or a higher per-minute rate to a specific destination than the per-minute rate to that specific destination promoted or advertised, on--CommentsClose CommentsPermalink





(A) the prepaid telephone calling card that is prepared by or at the direction of the prepaid telephone calling card service distributor;CommentsClose CommentsPermalink





(B) any point of sale material relating to the card that is prepared by or at the direction of the prepaid telephone calling card service distributor; orCommentsClose CommentsPermalink





(C) other advertising relating to the card or service.CommentsClose CommentsPermalink





(3) MINUTES ANNOUNCED, PROMOTED, OR ADVERTISED THROUGH VOICE PROMPTS- To sell, resell, issue, or distribute a prepaid telephone calling card that such distributor knows provides fewer minutes than the number of minutes announced, promoted, or advertised through any voice prompt given to a consumer at the time the consumer places a call to a dialed destination with the prepaid telephone calling card or service.CommentsClose CommentsPermalink





(4) EXPIRATION- To provide, sell, resell, issue, or distribute a prepaid telephone calling card that expires--CommentsClose CommentsPermalink





(A) before the date that is 1 year after the date on which such card is first used; orCommentsClose CommentsPermalink





(B) in the case of a prepaid telephone calling card that permits a consumer to purchase additional usage minutes or add additional value to the card or service, before the date that is 1 year after the date on which the consumer last purchased additional usage minutes or added additional value to the card or service.CommentsClose CommentsPermalink





(c) Liability- A prepaid telephone calling service provider or a prepaid telephone calling card distributor may not avoid liability under this section by stating that the displayed, announced, promoted, or advertised minutes, or the per-minute rate to a specific destination, are subject to fees or charges. A prepaid calling service provider or prepaid calling distributor shall not be liable for the disclosure of lawful fees, charges, or limitations made pursuant to regulations prescribed by the Commission under section 3, including lawful conditions of use.CommentsClose CommentsPermalink





(d) IMPLEMENTING REGULATIONS- The Commission may, in accordance with section 553 of title 5, United States Code, prescribe such regulations as the Commission determines are necessary to implement this section.CommentsClose CommentsPermalink

SEC. 5. ENFORCEMENT BY THE FEDERAL TRADE COMMISSION.

(a) Unfair and Deceptive Act or Practice- Notwithstanding any other provision of law, a violation of a regulation prescribed under section 3 or the commission of an unlawful act proscribed under section 4 shall be treated as a violation of a rule defining an unfair or deceptive act or practice prescribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).CommentsClose CommentsPermalink





(b) Authority of the Commission- The Commission shall enforce this Act in the same manner and by the same means as though all applicable terms and provisions of the Federal Trade Commission Act were incorporated into and made a part of this Act. Notwithstanding section 5(a)(2) of the Federal Trade Commission Act (15 U.S.C. 45(a)(2)), communications common carriers shall be subject to the jurisdiction of the Commission exclusively for the purposes of this Act, and section 5(a)(2) shall not be otherwise affected.CommentsClose CommentsPermalink





(c) Federal Communications Commission Authority-CommentsClose CommentsPermalink





(1) To the extent that the Federal Trade Commission has authority under this Act with respect to prepaid calling cards, prepaid calling card providers and prepaid calling card distributors, the Federal Communications Commission shall not exercise any authority that it may otherwise have with respect to such cards, providers and distributors.CommentsClose CommentsPermalink





(2) Except as provided in paragraph (1), nothing in this Act affects the authority of the Federal Communications Commission with respect to such prepaid calling card providers and distributors.CommentsClose CommentsPermalink

SEC. 6. STATE ENFORCEMENT.

(a) In General-CommentsClose CommentsPermalink





(1) CIVIL ACTIONS- In any case in which the attorney general of a State, a State utility commission, or other authorized State consumer protection agency has reason to believe that an interest of the residents of that State has been or is threatened or adversely affected by the engagement of any person in a practice that is prohibited under this Act, the State, as parens patriae, may bring a civil action on behalf of the residents of that State in a district court of the United States of appropriate jurisdiction--CommentsClose CommentsPermalink





(A) to enjoin that practice;CommentsClose CommentsPermalink





(B) to enforce compliance with this Act;CommentsClose CommentsPermalink





(C) to obtain damage, restitution, or other compensation on behalf of residents of the State; orCommentsClose CommentsPermalink





(D) to obtain such other relief as the court may consider to be appropriate.CommentsClose CommentsPermalink





(2) NOTICE TO FEDERAL TRADE COMMISSION-CommentsClose CommentsPermalink





(A) IN GENERAL- Before filing an action under paragraph (1), the attorney general of a State, a State utility commission, or an authorized State consumer protection agency shall provide to the Commission--CommentsClose CommentsPermalink





(i) written notice of the action; andCommentsClose CommentsPermalink





(ii) a copy of the complaint for the action.CommentsClose CommentsPermalink





(B) EXEMPTION-CommentsClose CommentsPermalink





(i) IN GENERAL- Subparagraph (A) shall not apply to the filing of an action under paragraph (1) if the attorney general of a State, a State utility commission, or an authorized State consumer protection agency filing such action determines that it is not feasible to provide the notice described in subparagraph (A) before the filing of the action.CommentsClose CommentsPermalink





(ii) NOTIFICATION- In an action described in clause (i), the attorney general of a State, a State utility commission, or an authorized State consumer protection agency shall provide notice and a copy of the complaint to the Commission at the time the action is filed.CommentsClose CommentsPermalink





(b) Intervention by Federal Trade Commission-CommentsClose CommentsPermalink





(1) IN GENERAL- Upon receiving notice under subsection (a)(2), the Commission may intervene in the action that is the subject of such notice.CommentsClose CommentsPermalink





(2) EFFECT OF INTERVENTION- If the Commission intervenes in an action under subsection (a), the Commission may--CommentsClose CommentsPermalink





(A) be heard with respect to any matter that arises in that action; andCommentsClose CommentsPermalink





(B) file a petition for appeal.CommentsClose CommentsPermalink





(c) Construction- Nothing in this Act may be construed to prevent an attorney general of a State, a State utility commission, or an authorized State consumer protection agency from exercising the powers conferred on the attorney general, a State utility commission, or an authorized State consumer protection agency by the laws of that State--CommentsClose CommentsPermalink





(1) to conduct investigations;CommentsClose CommentsPermalink





(2) to administer oaths or affirmations;CommentsClose CommentsPermalink





(3) to compel the attendance of witnesses or the production of documentary and other evidence;CommentsClose CommentsPermalink





(4) to enforce any State consumer protection laws of general applicability; orCommentsClose CommentsPermalink





(5) to establish or utilize existing administrative procedures to enforce the provisions of the law of such State.CommentsClose CommentsPermalink





(d) Venue; Service of Process-CommentsClose CommentsPermalink





(1) VENUE- Any action brought under subsection (a) shall be brought in the district court of the United States that meets applicable requirements relating to venue under section 1391 of title 28, United States Code.CommentsClose CommentsPermalink





(2) SERVICE OF PROCESS- In an action brought under subsection (a), process may be served in any district in which the defendant--CommentsClose CommentsPermalink





(A) is an inhabitant; orCommentsClose CommentsPermalink





(B) may be found.CommentsClose CommentsPermalink

SEC. 7. APPLICATION.

The regulations prescribed under section 3 and the provisions of sections 3 and 4 shall apply to any prepaid telephone calling card issued or placed into the stream of commerce, and to any advertisement, promotion, point-of-sale material or voice prompt regarding a prepaid telephone calling service that is created or disseminated more than 120 days after the date on which the regulations prescribed under section 3 are published in the Federal Register.CommentsClose CommentsPermalink

SEC. 8. EFFECT ON STATE LAW.

(a) Preemption-CommentsClose CommentsPermalink





(1) In general- Except as otherwise provided in this section, this Act preempts the laws of any State or political subdivision thereof to the extent that such laws are inconsistent with this Act, or the rules, regulations, or orders issued by the Commission under this Act.CommentsClose CommentsPermalink





(2) Exceptions- This Act shall not preempt any provision of State law or enforcement action that provides additional enforcement protection to consumers of prepaid telephone calling cards if such provision of law or enforcement action--CommentsClose CommentsPermalink





(A) imposes higher fines or more punitive civil or criminal remedies, including injunctive relief, for any violation of this Act, or the rules, regulations, or orders issued by the Commission under this Act; orCommentsClose CommentsPermalink





(B)(i) relates to terms, conditions, or issues that are not addressed by this Act, or by the rules, regulations, or orders issued by the Commission under this Act; andCommentsClose CommentsPermalink





(ii) is not determined by the Commission to be inconsistent with the public interest.CommentsClose CommentsPermalink





(b) Petitions Concerning Preemption-CommentsClose CommentsPermalink





(1) Petitions by providers-CommentsClose CommentsPermalink





(A) Authority to petition- A prepaid telephone calling card provider or a prepaid telephone calling card distributor may submit a petition to the Commission to challenge a State law or regulation--CommentsClose CommentsPermalink





(i) as inconsistent with this Act or the rules, regulations, or orders issued by the Commission under this Act; orCommentsClose CommentsPermalink





(ii) as inconsistent with the public interest, if the measure relates to terms, conditions, or issues that are not addressed by this Act, or the rules, regulations, or orders issued by the Commission under this Act.CommentsClose CommentsPermalink





(B) Deadline for commission action- Within 90 days after receiving a petition under subparagraph (A), the Commission shall issue a final determination on the issues presented in the petition. The Commission may issue an order staying the effectiveness of any State law or regulation that is the subject of the petition during, but for no longer than, such 90-day period.CommentsClose CommentsPermalink





(2) Proceedings on unaddressed issues- If, on the basis of any petition under paragraph (1), the Commission determines that a term, condition, or issue is not addressed by sections 3 or 4 of this Act, or the rules issued by the Commission under this section 3 of this Act, the Commission shall, within 180 days after the date of such determination, conduct an inquiry or other proceeding to determine whether the Commission should, in the public interest, promulgate a rule, pursuant to section 3(c), to address such term, condition, or issue.CommentsClose CommentsPermalink

SEC. 9. GAO STUDY.

Beginning 1 year after the date on which final regulations are promulgated pursuant to section 3(a), the Comptroller General shall conduct a study of the effectiveness of this Act and the disclosures required under this Act and shall submit a report of such study to the House Committee on Energy and Commerce and the Senate Committee on Commerce, Science, and Transportation no later than 2 years after the date of enactment of this Act.CommentsClose CommentsPermalink