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NEW JERSEY REGISTER
VOLUME 35, NUMBER 16
MONDAY, AUGUST 18, 2003
RULE PROPOSAL

LAW AND PUBLIC SAFETY
DIVISION OF CONSUMER AFFAIRS
Telemarketing
Bidder Qualifications

Proposed New Rules: N.J.A.C. 13:45D-1.3 and 2.1

Authorized By: Reni Erdos, Director, Division of Consumer Affairs.

Authority: N.J.S.A. 56:8-127 and 56:8-134.
Calendar Reference: See Summary below for explanation of exception to calendar requirement.
Proposal Number: PRN 2003-344.

Submit comments by October 17, 2003 to:

Reni Erdos, Director

New Jersey Division of Consumer Affairs

Office of the Director

124 Halsey Street

PO Box 45027

Newark, New Jersey 07101

The agency proposal follows:

Summary

On May 21, 2003, Governor James E. McGreevey signed A-727 (P.L. 2003, c.76), which supplemented the Consumer Fraud Act, N.J.S.A. 56:8-1 et seq. The new law prohibits unsolicited telemarketing calls to certain customers and establishes a no telemarketing call list under the jurisdiction of the Division of Consumer Affairs (Division). A provision of the new law provides that the Division may contract with a vendor to establish and maintain the no telemarketing call list and other related functions. In the event the Division determines to contract with a private vendor, the Division herein proposes a new rule at N.J.A.C. 13:45D-2.1 which establishes the qualifications interested bidders must meet in order to contract with the Division to establish and maintain the no telemarketing call list and other related functions.

Proposed new rule N.J.A.C. 13:45D-1.3 defines the phrase "no telemarketing call list" or "no call list" as a list of customers who do not wish to receive unsolicited telemarketing sales calls and the term "Division" as the Division of Consumer Affairs in the Department of Law and Public Safety.

Proposed new rule N.J.A.C. 13:45D-2.1, Bidder qualifications, establishes the requirements that must be met by a vendor who seeks to bid on the contract to maintain the Division's no telemarketing call list. The proposed rule requires bidders to establish their financial soundness by criteria as required by the Division of Purchase and Property and detailed in the Request for Proposal. These criteria may include the posting of a performance security. The proposed rule also requires bidders to show that they have the capacity to perform the services required in the Request for Proposal, which can be evidenced in part by a showing of technological capabilities and personnel. Also, the proposed rule requires bidders to submit documentation concerning past performance in regard to the same, similar or other types of work outlined in the Request for Proposal in this State or any other jurisdiction.

The proposed rule also requires an attestation from the bidder that there is no conflict of interest between any of the principals of the bidder or an association with a telemarketer. A conflict of interest exists if the bidder or any partner, officer or director holds, directly or indirectly, an interest in, or is employed by, or represents, appears for, or negotiates on the behalf of any telemarketer or any holding or intermediary company, that through an affiliate or subsidiary, conducts telemarketing activities.

As the Division has provided a 60-day comment period on this notice of proposal, this notice is exempted from the rulemaking calendar requirement pursuant to N.J.A.C. 1:30-3.3.

Social Impact

The proposed new rules seek to establish the qualifications of the vendor seeking to contract with the Division to establish and maintain the no telemarketing call list and perform other related functions. Vendors interested in providing such service to the Division will be affected by these rules as they will have to show they are qualified under the rules.

As the proposed rules will prevent New Jersey consumers from receiving unsolicited telemarketing sales calls, the rules will benefit the consumer by preventing interruptions of the consumer's privacy, family life and home sanctity.

Economic Impact

The Division does not believe that the proposed new rules will have any economic impact on the public as the fees that will be collected from registering telemarketers will be used to establish and maintain the no telemarketing call list.

Any prospective vendor who wishes to bid will incur costs in developing a proposal. These costs will vary between vendors.

Federal Standards Statement

A Federal standards analysis is not necessary as the proposal does not haveany applicable Federal standards.

Jobs Impact

The proposed rules may result in the creation of jobs in New Jersey if the successful bidder to maintain the no telemarketing call list is based in New Jersey.

Agriculture Industry Impact

The proposed new rules will not have any impact on the agriculture industry in the State.

Regulatory Flexibility Analysis

The Regulatory Flexibility Act (Act), N.J.S.A. 52:14B-16 et seq., requires the Division to estimate the number of small businesses to which the proposed new rules will apply. If, for purposes of the Act, the bidders are "small businesses" within the meaning of the statute, the following analysis applies.

The Act requires the Division to set forth the reporting, recordkeeping and other compliance requirements of the proposed new rules, including the kinds of professional services likely to be needed to comply with its requirements. The Act further requires the Division to estimate the initial and annual compliance costs of the proposed rules and set forth whether the rules establish differing compliance requirements for small businesses.

The proposed new rules do not impose any reporting or recordkeeping requirements on small businesses. Bidders must comply with the qualifications of the rules discussed in the Summary above. Bidders must demonstrate: their financial soundness; the capacity to perform the services outlined in the Request for Proposal; have performed similar work in this or another jurisdiction; have no conflict of interest or an association with a telemarketer.

In order to ensure that the protections to be afforded by the Act will benefit all consumers, no differing compliance requirements have been established for small businesses and the rules will be applied uniformly to all bidders. The need for professional services and the cost of compliance will vary among the bidders.

Smart Growth Impact

The proposed new rules will not have any impact upon the achievement of smart growth or upon the implementation of the State Development and Redevelopment Plan.

Full text of the proposed new rules follows:

CHAPTER 45D TELEMARKETING

SUBCHAPTER 1. GENERAL PROVISIONS

<< NJ ADC 13:45D-1.3 >>

13:45D-1.1 and 1.2 (Reserved)

13:45D-1.3 Definitions

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise:

"Division" means the Division of Consumer Affairs in the Department of Law and Public Safety.

"No telemarketing call list" or "no call list" means a list of customers in this State who do not wish to receive unsolicited telemarketing sales calls.

SUBCHAPTER 2. BIDDER QUALIFICATIONS

<< NJ ADC 13:45D-2.1 >>

13:45D-2.1 Bidder qualifications

(a) The Division may contract with a private vendor to establish and maintain the no call list. Any such contract shall be entered into after public bidding or an approved waiver of advertising by the Director of the Division of Purchase and Property on behalf of the Division of Consumer Affairs in accordance with the procurement methodologies set forth at N.J.A.C. 17:12-1A and the bidding process set forth at N.J.A.C. 17:12-2.

(b) Any proposal submitted by a bidder in connection with (a) above shall include documentation sufficient to establish:

1. Financial soundness by criteria as required by the Division of Purchase and Property and detailed in the Request for Proposal and which may include the posting of performance security;

2. The capacity to perform the services required as outlined in the Request for Proposal and as evidenced by a showing of technological capabilities and compatibilities, personnel, and other resources necessary to carry out the contract;

3. The performance of the same, similar or other types of work as outlined in the Request for Proposal in this State or any other jurisdiction; and

4. That none of the principals of the entity that submits a bid have any conflict of interest with a telemarketer or have an association with a telemarketer. A conflict of interest shall be deemed to exist if the bidder or any partner, officer, or director holds, directly or indirectly, an interest in, or holds employment with, or represents, appears for, or negotiates on behalf of any telemarketer, or any holding or intermediary company that, through an affiliate or subsidiary, conducts telemarketing activities.



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Posted August 2003