I 111th CONGRESS 2d Session H. R. 5583 IN THE HOUSE OF REPRESENTATIVES June 23, 2010 Ms. Shea-Porter introduced the following bill; which was referred to the Committee on Energy and Commerce A BILL To require cell phone early termination fees to be pro-rated over the term of a subscriber’s contract, and for other purposes.

1.

Short title

This Act may be cited as the Cell Phone Early Termination Fee, Transparency, and Fairness Act or the Cell Phone ETF Act.

2.

Pro-rated early termination fees for cell phones

(a)

In General

Not later than 180 days after the date of enactment of this Act, the Federal Communications Commission shall promulgate regulations requiring, at a minimum, that providers of commercial mobile service (as defined in section 332(d)(1) of the Communications Act of 1934 (47 U.S.C. 332(d)(1))— (1)prorate any early termination fee over the term of a subscriber’s contract; and (2)link the fee to the cost to the provider of the handset device provided to the subscriber, reduced by the price paid by the subscriber for the handset device at the start of a subscriber’s contract. (b)

Rate of Reduction and Other Considerations

In promulgating the regulations required by subsection (a), the Commission— (1)shall prohibit an early termination fee that exceeds the cost to the provider of the handset device provided to the subscriber, reduced by the price paid by the subscriber for the handset device at the start of a subscriber’s contract; (2)shall require a ratable reduction of the early termination fee over the term of the contract; (3)shall require clear and conspicuous disclosure of the early termination fee at the point of purchase and disclosure on customers’ monthly statements of account of the prorated early termination fee that would be due if the contract were terminated before the end of the next billing cycle; (4)shall consider, among other things, the effect of early termination fees on competition and on the ability of consumers to select and change providers of commercial mobile service; and (5)shall consider the economic basis and business rationale for the imposition of early termination fees by providers of commercial mobile service.

3.

No preemption of State law

Nothing in this Act shall be construed to preempt the laws of any State or local government regulating early termination fees chargeable to residents of that State or jurisdiction by commercial mobile service providers to which section 2 applies.