STATE OF CALIFORNIA GRAY DAVIS, Governor

PUBLIC UTILITIES COMMISSION

505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

July 3, 2001

TO: ALL PARTIES OF RECORD IN R.00-02-004

Enclosed is Item H-21a (July 12 agenda) Alternate Pages of Commissioner Duque to the draft decision of Commissioner Wood previously mailed to you. This item is on the Commission's agenda for July 12, 2001.

As set forth in Rule 77.6, parties to the proceeding may file comments on the enclosed alternate order no later than July 10, 2001. No reply comments will be accepted. An original and four copies of the comments with a certificate of service shall be filed with the Commission's Docket Office and copies shall be served on all parties on the same day of filing. The Commissioners and assigned ALJ shall be served separately by overnight service.

__________________________
LYNN T. CAREW

Chief Administrative Law Judge

FTF: mlt

Enclosures

COM/HMD DRAFT Item H-21a

Continuation 7/12/2001

ALTERNATE PAGES OF COMMISSIONER DUQUE

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking on the Commission's Own Motion to Establish Consumer Rights and Consumer Protection Rules Applicable to All Telecommunications Utilities.

Rulemaking 00-02-004 (Filed February 3, 2000)

TABLE OF CONTENTS

Title Page

INTERIM OPINION ADOPTING INTERIM RULES GOVERNING THE INCLUSION OF NONCOMMUNICATIONS-RELATED CHARGES 2

IN TELEPHONE BILLS 2

I. Summary 2

II. Background 2

III. Authority for Rules 2

A. Billing Agents and Vendors that are not Public Utilities 2

B. Wireless Telephone Service Providers 2

IV. Applicability of Truth in Lending Act 2

V. Basic Approach: Deterrence Through Accountability 2

VI. Key Issues 2

A. Protection for Consumers and Businesses 2

B. Role of Billing Telephone Company 2

C. Authorization of Charges 2

1. Billing Telephone Companies Must Obtain Affirmative Consent from a Subscriber before Opening Up that Subscriber's Telephone Bill to Non-Communications Charges (the "Opt-in" Requirement) 2

2. Charges Must Be Authorized By Subscriber at Point of Sale 2

3. Subscribers May Revoke Their Authorization 2

D. Privacy Protections 2

E. No Disconnection Rule 2

VII. Complaint Procedures 2

VIII. Conclusion 2

IX. Need for Hearings 2

X. Comments on Draft Decision 2

Findings of Fact 2

Conclusions of Law 2

INTERIM ORDER 2

APPENDIX A: Interim Rules Governing Non-Communications-Related
Charges on Telephone Bills

INTERIM OPINION

ADOPTING INTERIM RULES GOVERNING THE INCLUSION OF NONCOMMUNICATIONS-RELATED CHARGES

IN TELEPHONE BILLS

I. Summary

This decision adopts interim rules governing the inclusion of non-communications-related charges on telephone bills. Effective July 1, 2001, billing telephone companies are permitted to include non-communications charges on subscribers' telephone bills, subject to consumer protection rules adopted by the Commission. (Public Utilities Code Section 2890, version effective July 1, 2001.) ¹ Although recent anti-cramming legislation codified at Sections 2889.9 and 2890 contains many applicable consumer protection provisions, the Legislature has directed the Commission to adopt by July 1, 2001, "any additional rules it determines to be necessary to implement the billing safeguards of Section 2890, for the inclusion of non-communications-related products and services in telephone bills." (Section 2890.1) The interim rules set forth in Appendix A to this decision contain safeguards the Commission deems necessary, at this time, to ensure that subscribers are billed only for charges they have authorized.

The Commission is preparing new, comprehensive consumer protection rules that it will issue in the form of a General Order later in this proceeding. Today's interim rules, possibly with some modifications, will be incorporated into and superseded by that General Order.