HCS HB 228 -- UNSOLICITED COMMERCIAL ELECTRONIC MAIL

SPONSOR:  Dempsey (Pearce)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Job
Creation and Economic Development by a vote of 20 to 0.

This substitute requires the Attorney General to develop and
maintain a list of consumers who have registered their objection
to receiving unsolicited commercial e-mail.  Information
contained in the database can only be used to enforce this law
and is not considered public.  This database must be operational
by January 1, 2005.  Unsolicited e-mail cannot be sent to
subscribers in the database after January 1, 2005.

Anyone who sends commercial e-mail to any consumer in Missouri
must identify themselves clearly at the beginning of the message.

Telecommunications utilities or Internet service providers that
carry unsolicited e-mail initiated by others are not liable for
violations.

E-mail sent to a subscriber with whom the sender has had an
ongoing business relationship at some point during the last 12
months is not considered unsolicited electronic mail.  Neither
are e-mails sent by licensed professionals or tradesmen
attempting to set appointments for services related to their
trade or profession.  E-mail sent from the primary business's
parent company or a subsidiary company is considered unsolicited
and is in violation of this law.

Ongoing business relationships include e-mail in response to an
inquiry in which the subscriber has provided an e-mail address,
e-mail sent on the basis of an ongoing business relationship that
has not been terminated by the subscriber, or e-mail from a
separate entity with which the subscriber has an established
business relationship.

If child pornography web sites can be accessed through a
particular Internet service provider's system, a subscriber to
that system can notify the Attorney General of this access.  The
Attorney General is then required to notify the provider of the
child pornography sites that can reportedly be accessed through
its system.  The provider must block access to reported child
pornography sites within six months.  Failure to do so is a
violation of this law.

The Attorney General can initiate proceedings against violators
and impose injunctions and civil penalties of up to $5,000 for
each violation.  Violators are also subject to penalties provided
in merchandising practices law.  There is a two-year statute of
limitations.  State courts can exercise personal jurisdiction
over nonresidents.

FISCAL NOTE:  Estimated Net Cost to Merchandising Practices
Revolving Fund of $0 in FY 2004, $190,459 to $490,459 in FY 2005,
and $165,477 to $465,477 in FY 2006.

PROPONENTS:  Supporters say that the bill will prohibit unwanted
commercial e-mail, or "spam."  This will not only reduce
frustration for e-mail users, it will also reduce fraudulent and
deceptive use of e-mail.

The intent is to create a "No Spam" list similar to the No Call
list currently maintained by the Attorney General's office.  The
No Call list is a tool consumers can use to reduce the number of
telemarketing calls they receive, and it has been successful.
The No Spam list would work in a similar fashion.  Its intent is
not to disrupt current business relationships or interfere with
personal e-mail messages from senders known to the recipient.

Another benefit to the No Spam list is that it can reduce the
incidences of pornographic e-mail being sent to children or to
individuals who do not want it.  It can also reduce the
likelihood of senior citizens being taken advantage of over the
Internet.

The success of the No Call list has led to the recovery of fines
that are sufficient for the list to pay for itself.  Supporters
of the bill anticipate that a No Spam list would also be self-
funding through fines that would be received from violators.
Therefore, the No Spam list would eventually not require state
funding.  State funding would be required in the beginning to
create the database and investigate claims of violations.  This,
and any other future state funding, would come from the
Merchandising Practices Revolving Fund.  This is a dedicated fund
that is not a part of general revenue.

Testifying for the bill were Representatives Smith (14) and
Graham; Office of the Attorney General; ThoughtProcess.net;
Socket Holdings Corporation; and Missouri Family Network.

OPPONENTS:  Those who oppose the bill say that this legislation
does not adequately ensure that current business relationships
will not be disturbed.  Enforcement of the legislation will be
difficult because many mass distribution e-mails come from
overseas, making the violators difficult to track down or
prosecute.  Opponents are also concerned about the No Spam
database being sold by the Attorney General's office to
individuals or companies intending to use it as a mass
distribution e-mailing list or having it simply fall into the
wrong hands.

Testifying against the bill were Missouri Chamber of Commerce;
Missouri Association of Realtors; Missouri Press Association;
Mortgage Bankers Association; Missouri Financial Services
Association; National Association of Independent Insurers;
Virtumundo, Inc.; Internet Alliance; and Network Advertising
Institute.

Alice Hurley, Legislative Analyst

Missouri House of Representatives
Last Updated July 25, 2003 at 10:11 am