[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2033 Introduced in Senate (IS)]
1st Session
S. 2033
To provide for greater disclosure to, and empowerment of, consumers who
have entered into a contract for cellular telephone service.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 7, 2007
Ms. Klobuchar (for herself and Mr. Rockefeller) introduced the
following bill; which was read twice and referred to the Committee on
Commerce, Science, and Transportation
_______________________________________________________________________
A BILL
To provide for greater disclosure to, and empowerment of, consumers who
have entered into a contract for cellular telephone service.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Cell Phone Consumer Empowerment Act
of 2007''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) Some current wireless telephone contracts do not
clearly and uniformly disclose to the customer the relevant
terms and conditions, including charges, minutes, service
plans, and taxes and surcharges.
(2) Some current wireless telephone bills are not clearly
organized, do not clearly describe in plain language the
products and services for which charges are imposed, and
contain separate, line-item fees that--
(A) are not included in the advertised price of
wireless services;
(B) fail to adequately inform consumers of the
specific costs being recovered; and
(C) fail to indicate whether such charges are
required by government law or rule, or alternatively,
are imposed at the discretion of the carrier.
(3) The current lack of clarity and uniformity in wireless
telephone contracts and bills can lead to consumer confusion
and can impede the delivery of basic information necessary for
consumers to compare the cost of wireless services offered by
different carriers.
(4) Competitive markets function properly only when
consumers have access to accurate, meaningful information in a
format that they readily understand.
(5) Wireless companies often charge early termination fees
of $175 or more whenever a customer ends his or her service
before the expiration of the contract. In many instances, the
same fee is charged regardless of whether the contract is
terminated a day or a year after it is signed so long as the
contract period has not expired.
(6) The term of the contract is often extended whenever a
customer makes a change in the service, so an early termination
fee may apply years after a customer first subscribed to a
company's service.
(7) Early termination fees imposed in this way, do not bear
a strong relationship to legitimate business practices such as
recovery of the cost of a wireless device.
(8) Customers very often are unaware that their contracts
can be, and in fact are--
(A) extended based on changes, often minor changes,
to their service; and
(B) modified in materially adverse ways.
(9) In some instances, wireless providers do not make
available service maps with sufficient levels of granularity
for customers, especially customers in rural areas, to know
with any confidence whether and where they will have wireless
telephone service.
(10) Wireless customers do not have ready access to
information on the service quality of wireless providers,
including dropped calls, coverage gaps, and signal strength.
(11) Customers very often learn that the service quality
and coverage of their wireless device is insufficient only
after they have signed a 2-year contract and have begun using
the device.
SEC. 3. DEFINITIONS.
In this Act, the following definitions shall apply:
(1) Commission.--The term ``Commission'' means the Federal
Communications Commission.
(2) Telecommunications carrier.--The term
``telecommunications carrier'' has the meaning given that term
by section 3(44) of the Communications Act of 1934 (47 U.S.C.
153(44)).
(3) Telecommunications service.--The term
``telecommunications service'' has the meaning given that term
by section 3(46) of the Communications Act of 1934 (47 U.S.C.
153(46)).
(4) Wireless telephone services.--The term ``wireless
telephone services'' has the same meaning given the term
``commercial mobile radio services'' as such term is defined in
section 332(c) of the Communications Act of 1934 (47 U.S.C.
332(c)).
(5) Wireless telephone service provider.--The term
``wireless telephone service provider'' means any entity that
provides wireless telephone service.
SEC. 4. DISCLOSURE REQUIREMENTS FOR PLANS AND CONTRACTS FOR WIRELESS
TELEPHONE SERVICE.
(a) Disclosure Requirements.--Not later than 180 days after the
date of enactment of this Act, the Commission shall promulgate
regulations requiring that any publication, including publication on
the Internet, of the terms of a plan or contract for wireless telephone
service of a wireless telephone service provider shall set forth, in a
plain and conspicuous manner, the following information:
(1) Contract terms.--Information on plan and contract
terms, including the length of such contract, early or other
termination fees, the length of any trial period, and start-up
fees.
(2) Charges.--Information on charges, including calling-
from area, monthly base charge, per-minute charges for minutes
not included in the plan, and the method of calculating minutes
charged.
(3) Minutes.--Information on minutes included in the plan,
including weekday/daytime minutes, nights/weekend minutes, and
any other different method by which a subscriber is charged a
fee, such as for long distance-calls, roaming calls, incoming
calls, and directory assistance calls.
(4) Taxes and surcharges.--
(A) Taxes.--Information on taxes to be collected by
the provider for, and paid to, a State, local, or other
governmental agency.
(B) Surcharges.--Information on surcharges imposed
by the provider for the costs of compliance with
regulations or for any other purposes.
(5) E-911.--A statement notifying the customer that the
service includes basic wireless 911 service.
(6) Other information.--Any other information that the
Commission considers appropriate to ensure that wireless
consumers are fully informed of the terms of the plan or
contract.
(b) Information Required To Be Given to Any Purchaser.--Each
wireless telephone service provider shall provide the information
required under subsection (a) to a consumer prior to entering into any
contract with that consumer for wireless telephone service.
(c) Format.--The Commission shall complete a rulemaking requiring
that the information required by subsection (a) be published by
wireless service providers in a tabular format, in a clear and uniform
manner.
(d) Advertising.--A wireless telephone service provider shall, to
the extent possible allowed by the advertising medium chosen by such
provider, satisfy the requirements of this section in any advertisement
related to a plan or contract for wireless telephone service.
SEC. 5. CONTRACT BILLING.
(a) Organization of Bills.--A wireless telephone service provider
shall provide that each bill sent to a subscriber for wireless
telephone service is clearly organized, clearly describes in plain
language the products and services for which charges are imposed, and
conforms to such format standards as are established by the Commission.
(b) Taxes and Other Fees.--
(1) In general.--Taxes and fees which are required by a
Federal, State, or local statute or regulation to be collected
from a subscriber shall be set forth in a separate section of
each bill sent to a subscriber, and itemized separately.
(2) Limitation.--No charge which is not required to be
recovered from a subscriber under a Federal, State, or local
statute or regulation may be included in the section of the
bill described in paragraph (1).
(c) Roaming Charges.--Roaming or off-network charges associated
with any call placed by a subscriber shall be itemized on each bill
sent to such subscriber not later than 60 days after such call was
placed and shall identify the date and originating location of such
call.
(d) Itemized Bills.--Upon request of a subscriber, a wireless
telephone service provider shall provide an itemized bill to such
subscriber at no cost to such subscriber.
(e) Rulemaking.--Not later than 180 days after the date of
enactment of this Act, the Commission shall promulgate regulations
implementing the provisions of this section.
(f) Truth-in-Telephone Billing Regulations.--Except as otherwise
provided in this Act, not later than 180 days after the date of
enactment of this Act, the Commission shall initiate and conclude a
proceeding under the Communications Act of 1934 to prevent a
telecommunications carrier from listing any charge or fee on the
billing statement of a subscriber as a separately stated charge or fee
other than a charge or fee--
(1) for telecommunications service or other services
provider to a subscriber;
(2) for nonpayment, early termination of service, or other
lawful penalty;
(3) for Federal, State, or local sales or excise taxes; or
(4) expressly authorized by a Federal, State, or local
statute, regulation, or rule to appear on a subscriber's
billing statement as a separately stated charge or fee.
SEC. 6. PROVISION OF INFORMATION ON WIRELESS TELEPHONE SERVICE COVERAGE
AND QUALITY TO CONSUMERS.
(a) Service Area Maps.--
(1) In general.--Each wireless telephone service provider
shall make available a map showing the wireless telephone
service area of such provider and the wireless telephone
service area of such provider within each State.
(2) Granularity.--Each map required under paragraph (1)
shall be prepared to reflect the county level of wireless
telephone service, shall be updated quarterly, and shall be in
sufficient detail to--
(A) identify all geographic areas within such
county larger than a number of square miles to be
determined by the Commission where wireless telephone
service is not regularly available; and
(B) identify whether or not a consumer shall be
able to receive wireless telephone service where the
consumer's primary residence is located.
(3) Times of provision.--A map of the service area of a
wireless telephone service shall be provided to a consumer--
(A) upon request of the consumer;
(B) whenever a plan or contract for the service is
entered into; and
(C) at such other times as the Commission shall
provide.
(4) Electronic availability.--Each map of a service area
under paragraph (1) shall be available--
(A) on the Internet website of the provider
concerned; and
(B) on the Internet website of the Commission.
(b) Service.--
(1) Monitoring.--The Commission shall monitor the quality
of wireless telephone service provided in the United States by
requiring semiannual reports of wireless service providers on
the following:
(A) Dropped calls within geographic areas to be
determined by the Commission.
(B) Known coverage gaps (including average signal
strength) or dead zones within geographic areas to be
determined by the Commission.
(C) Any other matters the Commission considers
appropriate.
(2) Public comments.--The Commission shall establish an
Internet website at which members of the public can submit to
the Commission their comments and views on the quality of
service of any wireless telephone service provider.
(3) Publication.--The Commission shall make available to
wireless telephone service providers and to the public on a
semiannual basis the information received under this section on
the quality of wireless telephone service.
(c) Regulations.--Not later than 180 days after the date of
enactment of this Act, the Commission shall promulgate regulations
implementing the provisions of this section.
SEC. 7. EARLY TERMINATION FEES.
(a) Requirements.--Not later than 180 days after the date of
enactment of this Act, the Commission shall promulgate regulations
requiring that early termination fees be prorated over the term of a
wireless subscriber's contract, in a manner that reasonably links the
fee to recovery of the cost of the device or other legitimate business
expenses.
(1) Minimum.--The Commission shall have appropriate
discretion to implement the terms of this section, but at a
minimum the early termination fee for a 2-year contract should
be reduced by \1/2\ after 1 year.
(2) Considerations.--In conducting this rulemaking, the
Commission should consider, among other things, the effect of
early termination fees on competition and on the ability of
consumers to choose their wireless provider, as well as the
legitimate business reasons for early termination fees.
SEC. 8. CONTRACT EXTENSION, MODIFICATION, OR RESCISSION.
(a) Validity of Extensions.--
(1) In general.--An extension of a contract for wireless
telephone service shall not be valid unless--
(A) the wireless telephone service provider
provides point-of-sale notice of the extension to the
subscriber; and
(B) the subscriber may cancel the extension for any
reason within 30 days after the notice required by
subparagraph (A) is provided.
(2) No cancellation penalty.--If a subscriber cancels the
extension of a contract for wireless telephone service within
the 30-day period provided by paragraph (1)(B) the wireless
telephone service provider may not impose a penalty or other
cost for the cancellation on the subscriber. A charge for
wireless telephone service provided to the subscriber during
the extension period before cancellation shall not be
considered to be a penalty or cost of cancellation for purposes
of this paragraph.
(b) Notice of Any Modifications.--
(1) In general.--A wireless telephone service provider
shall provide subscribers with written notice of any change in
rates, terms, or conditions of service at least 30 days before
such change is to take effect.
(2) Right to terminate for material adverse changes.--If
any change in rates, terms, or conditions of service will
result in higher rates or more restrictions on service or
otherwise will result in a material, adverse change for a
subscriber, such subscriber may, not later than the day such
change is to take effect, terminate the service without penalty
and receive a pro rata refund of the charges, if any, paid for
the handset used for such service.
(3) Required content of notice.--The notice of change
required under paragraph (1) shall inform a subscriber of--
(A) the right of that subscriber to terminate the
service and to a handset refund; and
(B) the steps necessary to implement such a
termination.
(c) Right of Rescission.--
(1) In general.--A contract for wireless service may be
canceled upon the request of a subscriber for any reason up to
30 days after the date on which the contract was executed.
(2) No penalty.--If a subscriber exercises the right of
rescission under paragraph (1), there shall be no penalty or
other costs to such subscriber for such rescission, except that
such subscriber shall be responsible for the cost of the
wireless service used during the time period the contract was
in effect.
(3) Handset.--On the return of any handset purchased or
leased in connection with the purchase of wireless service, a
subscriber may receive a pro-rated refund of any amount paid
for the handset.
SEC. 9. REPORT ON HANDSET LOCKING AND PORTABILITY.
(a) Report.--Not later than 180 days after the date of enactment of
this Act, the Commission shall submit a report to Congress that
analyzes--
(1) the practice in the United States of handset locking;
(2) the practice of handset portability in European and
Asian markets;
(3) the effects on competition and the effect of consumer
behavior, of the practices described in (1) and (2); and
(4) potential methods of regulating handset locking and
portability in the United States.
SEC. 10. TERMINATION OF CONTRACTS FOR CELLULAR PHONE SERVICES FOR ARMED
FORCES PERSONNEL.
(a) Termination.--
(1) Inclusion of contracts under termination authority.--
Title III of the Servicemembers Civil Relief Act (50 U.S.C.
App. 531 et seq.) is amended by adding at the end the following
new section:
``SEC. 309. TERMINATION OF CONTRACTS FOR CELLULAR PHONE SERVICE.
``(a) Termination by Servicemember.--A servicemember who is a party
to a contract described in subsection (b) may, at the option of such
servicemember, terminate the contract at any time after--
``(1) the date of the entry of that servicemember into
military service; or
``(2) the date of the military orders of the servicemember
described in paragraphs (1) or (2) of subsection (b), as the
case may be.
``(b) Covered Contracts.--This section applies to any
telecommunications contract for cellular phone service--
``(1) the contract is executed by or on behalf of a person
who thereafter and during the term of the contract enters
military service (or receives an order to enter military
service) under a call or order specifying a period of not less
than 90 days (or who enters military service under a call or
order specifying a period of 90 days or less and who, without a
break in service, receives orders extending the period of
military service to a period of not less than 90 days); or
``(2) the person enters into the contract while in military
service and thereafter receives military orders for a permanent
change of station outside of the continental United States, or
to deploy with a military unit for a period of not less than 90
days, to a location that does not support continuation of the
service under the contract.
``(c) Manner of Termination.--
``(1) In general.--Termination of a contract under
subsection (a) is made by delivery by the servicemember of
written notice of such termination to the other party to the
contract (or that person's grantee or agent).
``(2) Nature of notice.--Delivery of notice under paragraph
(1) may be accomplished--
``(A) by hand delivery;
``(B) by private business carrier; or
``(C) by placing the written notice in an envelope
with sufficient postage and with return receipt
requested, and addressed as designated by the party to
be notified (or that party's grantee or agent), and
depositing the written notice in the United States
mails.
``(d) Effective Date of Contract Termination.--Termination of the
contract is effective on the day on which the notice is delivered.
``(e) Penalties.--
``(1) Misdemeanor.--Any person who knowingly seizes, holds,
or detains the personal effects, security deposit, or other
property of a servicemember (or of a dependent of a
servicemember) who lawfully terminates a contract covered by
this section, or who knowingly interferes with the removal of
such property from premises covered by such contract, for the
purpose of subjecting or attempting to subject any of such
property to a claim for contract payments accruing subsequent
to the date of termination of such contract, or attempts to do
so, shall be fined as provided in title 18, United States Code,
or imprisoned for not more than 1 year, or both.
``(2) Preservation of other remedies.--The remedy and
rights provided under this section are in addition to and do
not preclude any remedy for wrongful conversion otherwise
available under law to the person claiming relief under this
section, including any award for consequential or punitive
damages.
``(f) Definitions.--In this section, the following definitions
shall apply:
``(1) Military orders.--The term `military orders', with
respect to a servicemember, means official military orders, or
any notification, certification, or verification from the
servicemember's commanding officer, with respect to the
servicemember's current or future military duty status.
``(2) CONUS.--The term `continental United States' means
the 48 contiguous States and the District of Columbia.''.
SEC. 11. ENFORCEMENT.
(a) Enforcement by the FCC.--
(1) In general.--The Commission shall have the power and
authority to enforce the provisions of this Act as if such
provisions were provisions of the Communications Act of 1934.
(2) Penalties.--Penalties authorized by title V of the
Communications Act of 1934 may be imposed under this subsection
for a violation of a provision of this Act.
(b) Enforcement by States.--
(1) Authority.--The attorney general of a State, or the
public utility commission of a State if authorized by the laws
of the State, may--
(A) bring a civil action on behalf of the residents
of the State in a district court of the United States
of appropriate jurisdiction to enforce the provisions
of this Act; or
(B) establish or utilize existing administrative
procedures to enforce the provisions of this Act.
(2) Penalties.--Penalties authorized by title V of the
Communications Act of 1934 for a violation of a provision of
that Act may be imposed in a civil action under the subsection
for a violation of a provision of this Act.
SEC. 12. PREEMPTION.
This Act preempts the laws of any State to the extent that such
laws are inconsistent with this Act, except that this Act shall not
preempt any State laws that provide additional protection to
subscribers of wireless telephone service.
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