Yesterday marked a concerning day for the e-commerce industry as the Oregon House of Representatives passed House Bill 3865. The Ecommerce Innovation Alliance (EIA) expresses its profound disappointment at the bill’s advancement, especially in light of the substantial and clearly articulated concerns raised by the EIA and numerous businesses regarding its detrimental impact on modern ecommerce practices, particularly text message marketing, a vital tool for engaging with consenting customers.
From the outset, HB 3865 has been a source of significant apprehension for the ecommerce sector. This legislation introduces a series of ill-conceived regulations that demonstrate a fundamental disconnect from the realities of how online businesses communicate with consumers and operate in a national marketplace. The bill’s journey through the House, under the guidance of House Committee on Commerce and Consumer Protection Chair Nathan Sosa, has been particularly troubling due to a perceived unwillingness to genuinely address the legitimate worries voiced by industry stakeholders.
One of the most striking aspects of HB 3865 is its unprecedented move to regulate Rich Communication Services (RCS). Oregon is now on the verge of becoming the first state to expressly regulate RCS, a decision that directly contradicts the Federal Communications Commission’s (FCC) established position that RCS falls outside the purview of the federal Telephone Consumer Protection Act (TCPA). As the EIA has emphasized, this regulatory divergence creates an untenable situation for businesses operating nationwide. Due to essential privacy protections, it is technically impossible for a business to determine if a recipient of an RCS message is located in Oregon. This makes compliance with Oregon-specific RCS regulations practically unachievable and risks stifling the adoption of this innovative technology that promises richer and more engaging customer experiences.
Furthermore, HB 3865 proposes dramatically stricter “quiet hours” for text messaging, commencing at 7:00 PM Pacific time, even for consumers who have proactively provided their prior express written consent to receive messages. This deviates significantly from the federal standard of 8:00 AM to 9:00 PM, which, crucially, does not prohibit communications with prior express consent. This precise issue is currently pending before the FCC where EIA has asked the agency to confirm that, under existing federal law, once a consumer grants consent to receive communications, they retain the power to revoke that consent if the timing becomes inconvenient, but cannot clog our courts with wasteful litigation. To impose a blanket restriction, even with consent in Oregon, places an unreasonable and technically challenging burden on businesses, particularly given the impossibility of real-time location tracking.
The imposition of an arbitrary 3-message limitation within a 24-hour period is another deeply flawed aspect of HB 3865. In today’s ecommerce environment, where conversational commerce is increasingly prevalent, consumers often engage in back-and-forth communication with businesses to seek information and support during their purchasing journey. Limiting these interactions to a mere three messages could stifle legitimate customer service inquiries, hinder sales completion, and ultimately frustrate consumers. The lack of a clear definition of what constitutes a “message” further compounds the impracticality of this restriction.
Moreover, HB 3865 mandates the inclusion of a series of disclosures in text messages, drawing from ORS 646.611(1), many of which are completely irrelevant to the context of modern text message marketing. Requiring disclosures such as “Provides identification of both the person and whom the person represents” and “Explains the purpose of the person’s call” in a concise text message demonstrates a profound misunderstanding of the medium and imposes unnecessary burdens. For businesses that use text messaging to offer early access to products to consenting customers, these irrelevant disclosure requirements could lead to legal challenges despite their good-faith efforts to comply. The fundamental issue remains: due to privacy constraints, businesses cannot definitively know if a text message recipient is in Oregon, rendering compliance with these state-specific disclosure rules practically impossible for any company operating nationally.
Throughout the legislative process in the House, the EIA actively engaged in public hearings and follow-up meetings with Representative Sosa’s office and the Oregon Department of Justice, clearly outlining these significant concerns. Despite these concerted efforts to provide valuable industry insights and highlight the potential for unintended negative consequences,this feedback was disregarded. Further, during the final committee hearing and again during floor debate, committee member Rep. Virgle Osborne requested to delay the bill for further discussion to prevent the unintended consequences that the bill will have on businesses who have obtained consent. Those requests were disregarded by Representative Sosa. Further, Rep. Osborne expressed concern during floor debate that a 7 PM quiet hour rule, without a prior express consent exclusion, would put businesses in the untenable position of not being able to respond to customers seeking information or trying to complete a purchase. In response, Representative Sosa told his colleagues that the bill “would only prohibit the initial solicitation [after 7 PM]. Once a customer engages with a business, the business is absolutely free to follow up with them and proceed with that relationship.” The current bill lacks language to this effect, however.
As HB 3865 now moves to the Oregon Senate, where discussions are anticipated to commence later this month and the bill is expected to be assigned to the Senate Labor and Business Committee, chaired by Senator Kathleen Taylor. The EIA remains hopeful that a more thoughtful and collaborative approach will prevail in the Senate. Senator Taylor and Republican Vice Chair, Senator Daniel Bonham, have a history of being serious legislators who value and consider industry input in their shared commitment to avoid harmful and unintended consequences.
The passage of HB 3865 by the Oregon House represents a step backward for fostering a thriving ecommerce environment. The bill’s technically unworkable provisions, its disregard for established federal guidelines, and the refusal to meaningfully address the well-founded concerns of the business community create an uncertain and potentially highly litigious landscape. The EIA will continue its diligent work in the Oregon Senate to underscore the harmful ramifications of this legislation and advocate for a more sensible and balanced path forward that supports both innovation and consumer engagement without imposing undue and impossible burdens on legitimate ecommerce businesses.
