Bowing to strong lobbying pressure from housing interests and other business groups, the Federal Communications Commission has extended to Jan. 1, 2005 the effective date of its new rule requiring written consent before sending advertising faxes.

The extension permits entities sending fax advertisements more time to comply with the new rules and obtain written consent and signatures from parties to whom they wish to fax. It also will allow the Commission time to consider any petitions for reconsideration and other filings that may be made on this issue.

The 16-month extension keeps in effect the FCC's long-standing exemption that allows entities to send unsolicited fax advertisements to individuals and businesses with which they have established business relationships. But beginning Jan. 1, 2005, anyone transmitting faxes must obtain express written consent, including signatures, from recipients with whom they have established business relationships.

Regardless of the extension, however, fax transmitters still must obtain prior express permission from recipients with whom they do not have established business relationships. The FCC decided to postpone the rule after meeting with various trade groups which explained how the businesses they represent would be disrupted if the change was allowed to take effect next Monday, Aug. 25, as originally planned.

Several groups, including the National Association of Realtors, Mortgage Bankers Association and National Association of Mortgage Brokers, also has petitioned the agency for what amounted to a stay of execution.

NAR President Cathy Whatley pointed out that with more than 2 million home sales in the pipeline on any given day, the do-not-fax rule would have interfered with the day-to-day business relationships between the nation's 900,000-plus Realtors and their clients as well as unfairly limit communications between state, local and national associations and their members.

"The ability to move promptly and communicate via fax is instrumental to the success of these transactions in highly competitive housing markets," the Jacksonville, Fla., Realtor said. "Yet businesses were originally given less than 30 days to amend their current practices and gain new consent from customers and vendors."

The MBA complained that the broad definition of "unsolicited advertisements" would include rate sheets faxed between wholesale lenders and brokers, as well as other communications to brokers, correspondents or consumers.

According to the MBA, the mortgage industry comprises nearly a quarter of the fax broadcasting market, with 11 percent more coming from other financial services. According to Xpedite, a broadcast fax company, the bulk of this traffic is sent from major financial institutions and insurance companies to mortgage brokers.

Both Whatley and MBA Senior Vice President Kurt Pfotenhauer praised the decision to delay the rule, saying it will "ensure minimal disruption" by giving senders the time they need to obtain written consents and signatures from those with whom they do business.

Other groups which filed for a stay included the American Society of Association Executives, National Federation of Independent Business and the U.S. Chamber of Commerce. The Small Business Administration also supported the stay.

Published: August 21, 2003

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