United States: FCC Releases Rules To Address Cramming, Considers Further Action

On April 27, 2012, the US Federal Communications Commission (FCC) released a Report & Order & Further Notice of Proposed Rulemaking (FCC 12-42) in which the FCC imposed new rules on wireline carriers and sought comment on a number of additional issues that impact both wireless and wireline service providers, including (1) whether to implement an "opt-in" system for third-party charges and (2) whether the FCC needed to act to address cramming in the wireless market.

Comments are due on the FNPRM 30 days after publication in the Federal Register; reply comments are due 45 days thereafter.

New Rules – Applicable to Wireline Carriers Only But Impact Wireless and VoIP Practices

The new rules require wireline carriers to clearly and conspicuously notify consumers of options for blocking the inclusion of third-party charges on their invoices. The rules also requires wireline carriers to make this information available:

  • at the point of sale;
  • on each bill; and
  • on the carrier's website.

The new rules require wireline carriers to place charges from third parties for non-telecommunications services in a separate section of the bill, distinct from charges for telecommunications services.

  • The payment potion of the bill must also clearly and conspicuously identify and disclose separate subtotals for charges from the carrier and charges form non-carrier third-parties.

While the new rules apply only to wireline carriers, wireless carriers should take the practices these rules mandate into account when developing their billing and disclosure practices.

Further Notice of Proposed Rulemaking – Requests Comment on Wireless Practices

The FCC seeks comment on whether a consumer should be required to "opt-in" to third-party billing before a carrier can place charges on that consumer's phone bill.

  • If adopted, should the opt-in requirement apply equally to telecommunications and non-telecommunications services?
  • Should the opt-in requirement apply to all third-party telecommunications services or only to certain types of telecommunications services?
  • How should consumer assent to such charges be determined? Is short code messaging (for CMRS providers) a valid method for demonstrating such assent?
  • What costs would carriers be required to bear in complying with the opt-in process?

The FCC also seeks comment on where and when a consumer should be made aware of the opportunity to opt-in and accept third-party billing charges.

  • Should notification of the possibility of third-party charges and the option to opt-in to those types of charges be required to appear in website, print, and/or in-store advertising?
  • Should the FCC require carriers to inform the consumer at the point of sale about third-party charge blocking and provide the consumer with the opportunity to opt-in to third-party charges?
  • Should existing consumers be informed of the possibility of third-party charges on their bill and provided instructions or information as to how to opt-in or decline those charges?
  • Once a consumer has opted-in to receive third-party charges on his or her bill, should the consumer's current opt-in status be disclosed on every bill so that he or she will know whether to be looking for such charges on that bill?

The FCC also seeks comment regarding the duration of each opt-in approval and what happens when a consumer decides to revoke a prior opt-in approval or to give new opt-in approval.

The FCC also expressed concern that wireless cramming is a growing problem, and seeks comment on:

  • steps the wireless industry has taken to date and what steps might it take in the future to protect CMRS consumers;
  • technological solutions that might help consumers, such as apps for mobile phones, that could help consumers avoid cramming; and
  • steps the FCC should consider to help CMRS consumers combat cramming.

Finally, to the extent that cramming is rapidly becoming associated with Internet and other non-telecommunications services, the FCC seeks comment on whether it has authority to require "opt-in" for wireline and wireless carriers under Section 201 and/or its ancillary authority under Title I of the Communications Act.

Background and History

Current Voluntary Industry Practices

In 1998, the nation's wireline local exchange carriers ("LECs") and providers of billing-and-collection services adopted a voluntary code of "best practices" designed to prevent cramming. According to these best practices:

  • bills should be comprehensible, complete, and include information the consumer may need to discuss, and if necessary, dispute billed charges with the carrier;
  • consumers should be provided with options to control whether a third party may include charges for its products and services on their telephone bills;
  • consumer authorization of services ordered should be appropriately verified;
  • LECs should screen products, services, and third-party service providers prior to allowing their charges on consumer's telephone bills;
  • clearinghouses that aggregate billing for third-party providers and submit that billing to LECs should ensure that only charges that have been authorized by the consumer are included;
  • LECs should continue to educate consumers as to their rights and the process for resolution of disputes; and
  • LECs should cooperate with each other, law enforcement, and regulatory agencies to assist in controlling carrier inclusion of unauthorized charges on a consumer's bill.

Truth-In-Billing Rules

In 1999 the FCC adopted, and in 2005 revised, its Truth-In-Billing Rules to address consumer confusion and increases in practices such as slamming and cramming.

  • In the Orders, the FCC determined that cramming is an unjust and unreasonable practice prohibited by section 201(b) of the Act and adopted the Truth-in-Billing rules in part to address cramming.
  • The majority of the Truth-In-Billing rules only apply to wireline LECs, and require that consumer bills:
    • be clearly organized, clearly identify the service provider, and highlight any new provider (i.e., one that did not bill the customer for service during the last billing cycle);
    • separate charges by service provider; and
    • contain clear and conspicuous disclosure of any information that the consumer may need to make inquiries about, or to contest charges on, the bill.
  • The rules also require both wireline and wireless carriers to ensure that their bills contain full and non-misleading descriptions of the charges that appear therein.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
8 Nov 2016, Webinar, Washington, United States

Join Dentons government contracts lawyers for a Public Contracting Institute (PCI) webinar series involving the most current industry analysis in government contract cost accounting from a team of leaders in the field with unparalleled experience

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.