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The Telemarketing Sales Rule: What It Requires and Who It Covers

Published April 20, 2026

When people think about the rules on sales calls in the United States, the Telephone Consumer Protection Act (TCPA) usually comes to mind first. But there's a second set of federal rules that's just as important, particularly when it comes to honesty on sales calls: the Telemarketing Sales Rule, often called the TSR.

While the TCPA focuses mainly on how and when calls are made, the TSR focuses heavily on what is said during them and how payments are handled. Together, they form the core of federal telemarketing regulation in the US. This article explains what the TSR is, who it applies to, and what it requires.

This article is for general information only and isn't legal advice. Businesses should seek advice from a qualified lawyer about how the TSR applies to their specific situation.

What Is the Telemarketing Sales Rule?

The Telemarketing Sales Rule is a set of regulations issued and enforced by the Federal Trade Commission (FTC). It was created under the Telemarketing and Consumer Fraud and Abuse Prevention Act, which Congress passed in 1994, and first took effect in 1995.

Its purpose is to protect consumers from deceptive and abusive telemarketing practices. In the early 1990s, telemarketing fraud was causing serious financial harm, with scams involving fake prizes, worthless investments, and services that never materialized. The TSR was designed to stop those practices while allowing legitimate telemarketing to continue.

The rule has been updated several times since, most notably in 2003, when it was amended to create the National Do Not Call Registry, and again in 2024, when its recordkeeping requirements were expanded and some protections were extended to business-to-business calls.

How the TSR Differs From the TCPA

The two laws overlap, but they come from different agencies and focus on different things.

The TCPA is enforced mainly by the Federal Communications Commission (FCC) and focuses on the technology and timing of calls: autodialers, prerecorded and artificial voices, text messages, consent, and calling hours. It also allows individuals to sue directly for each violation.

The TSR is enforced by the FTC and focuses on deceptive and abusive practices, including what callers must disclose, what they can't misrepresent, how payment is handled, and what records must be kept. It also contains Do Not Call and calling-hours rules that sit alongside the TCPA's.

In practice, many telemarketing calls are covered by both, and businesses need to follow both sets of rules.

Who Does the TSR Apply To?

The TSR applies to telemarketing, which it defines as a plan, program, or campaign to encourage people to buy goods or services, or to make charitable donations, using one or more telephones and involving more than one interstate call.

It covers two groups:

Sellers, the businesses whose goods or services are being sold.

Telemarketers, the people or companies making or receiving the calls, including outsourced call centers calling on a seller's behalf.

Both can be held responsible for violations. A seller who hires a call center can't avoid responsibility simply because someone else made the calls.

Main exemptions

Certain calls are fully or partly exempt from the TSR. These include:

Many business-to-business calls, though some protections still apply, including the ban on misrepresentations added in 2024, and the full rule applies to calls selling nondurable office or cleaning supplies.
Some inbound calls, where a customer calls in response to an advertisement or catalog, although many exceptions apply, including calls involving investment opportunities, debt relief, tech support, and attempts to sell additional products during the call.
Calls that follow a face-to-face sales presentation, where the final sale is completed later by phone.

Some types of organizations, such as banks, telephone companies, and nonprofit organizations calling on their own behalf, fall outside the FTC's jurisdiction. However, third-party telemarketers calling on their behalf may still be covered.

What the TSR Requires

Prompt disclosures on outbound calls

On an outbound sales call, the telemarketer must promptly, and before anything else, tell the person:

The identity of the seller.
That the purpose of the call is to sell goods or services.
The nature of the goods or services being offered.
That no purchase or payment is necessary to enter or win, if a prize promotion is involved.

Charitable solicitation calls have similar requirements, including disclosing the identity of the charity and that the purpose is to ask for a donation.

Disclosures before payment

Before a customer agrees to pay, the telemarketer must clearly disclose the key terms of the offer, including:

The total cost and quantity of the goods or services.
Any material restrictions, limitations, or conditions.
The refund or cancellation policy, including stating plainly if there are no refunds, if that's the policy.
The odds of winning and any conditions, for prize promotions.
The terms of any "negative option" arrangement, where the customer will be charged unless they take action to cancel.

No misrepresentations

The TSR prohibits telemarketers from misrepresenting any material information, including the cost, quality, or nature of what's being sold, the refund policy, the risks or likely earnings of an investment, or any affiliation with a government agency or other organization. Since 2024, this ban on misrepresentations also applies to business-to-business telemarketing calls.

Payment protections

The TSR includes several rules about how payment is taken:

Express verifiable authorization is required for certain payment methods that don't have the same protections as credit cards, so customers can't later be charged without clear agreement.
Using account information obtained elsewhere to charge a customer without their clear consent is restricted.
Certain payment methods are banned in telemarketing, including remotely created checks, cash-to-cash money transfers, and cash reload cards, because they've been widely used in fraud and offer consumers little protection.
Advance fees are banned for certain services commonly associated with fraud, such as some debt relief, credit repair, and loan recovery services, so customers can't be charged before the promised service is delivered.

Do Not Call rules

The TSR prohibits telemarketing calls to numbers on the National Do Not Call Registry, unless an exception applies, such as an established business relationship or the person's written permission. Businesses must access the registry and remove registered numbers from their call lists, with the registry checked at least every 31 days.

Businesses must also respect entity-specific Do Not Call requests, meaning if a person tells a business not to call them again, that business must stop calling them, even if their number isn't on the national registry.

Calling times

Telemarketing calls can only be made between 8 a.m. and 9 p.m. in the called person's local time.

Caller ID

Telemarketers must transmit caller ID information, including a phone number that the person can call back during normal business hours, and, where available, the seller's or telemarketer's name. Blocking or hiding caller ID is prohibited.

Abandoned calls

The TSR limits abandoned calls, where a person answers and no live representative is available within two seconds of their greeting, to no more than 3% of answered calls per campaign over a 30-day period. Unanswered calls must ring for at least 15 seconds or four rings before being disconnected, and when a call is abandoned, a recorded message must play identifying the seller and providing a phone number.

Prerecorded messages

Telemarketing calls using prerecorded messages are generally prohibited unless the person has given a signed, written agreement to receive them from that seller. These messages must also include an automated way for the person to opt out of future calls during the message.

Recordkeeping

Sellers and telemarketers must keep detailed records of their telemarketing activity. Since the 2024 amendments, these records must generally be kept for five years, and they include copies of scripts and promotional materials, records of customers and transactions, call details, records of consent, and Do Not Call compliance.

Enforcement and Penalties

The FTC enforces the TSR and can bring legal action against businesses and individuals who violate it. Penalties can be substantial, with civil penalties of more than $50,000 per violation, an amount adjusted each year for inflation. Courts can also order businesses to return money to consumers and impose restrictions on how they operate in the future.

State attorneys general can also enforce the TSR, and individuals who suffer significant financial losses may, in limited circumstances, bring their own cases.

Safe Harbor

The TSR includes a safe harbor provision for some Do Not Call and abandoned call violations. A business may avoid liability for an occasional violation if it can show the violation happened despite having proper procedures in place, such as written policies, staff training, regular checks against the Do Not Call registry, and accurate records. This is one more reason why careful processes and recordkeeping matter.

Good Practice Under the TSR

A few principles help businesses stay within the rule:

Be upfront at the start of every sales call about who is calling and why.
Explain the full terms clearly before taking any payment, including cost, conditions, and refund policy.
Never misstate or exaggerate what's being offered.
Use secure, protected payment methods, and avoid banned methods entirely.
Check numbers against the National Do Not Call Registry regularly, and honor every request not to be called.
Call only within permitted hours in the recipient's local time.
Transmit accurate caller ID with a working callback number.
Keep thorough records for the required period.
Make sure every partner calling on your behalf follows the rules.

Honesty at the Heart of the Rule

The Telemarketing Sales Rule was created to stop telemarketing from being used to deceive and defraud people. Its requirements, from clear disclosures to payment protections and detailed recordkeeping, all support the same principle: people should know who is calling, what's being offered, and exactly what they're agreeing to. For businesses that sell by phone in the United States, following the TSR isn't just a legal obligation. It's the basis of a sales conversation people can trust.