FCC Loosens Rules on Device Importation, Marketing, Pre-Sales

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The FCC has unanimously voted to adopt changes to its rules to allow the importation and shipping of a limited number of 5G communications and other devices before they have secured FCC approval.

The commission had already voted unanimously last December to propose the changes.

"Since the 1970’s, our rules have prohibited innovators from marketing or pre-selling their products to the public before getting authorization from the FCC," said acting FCC Chair Jessica Rosenworcel. "Our system was designed this way to help ensure that new devices entering the United States comply with our rules and technical standards. But the record in this proceeding shows that while the marketplace has evolved, our rules have not kept up."

She said the rules change will insure that the U.S. supports a larger set of innovators. "Now is the right time to do this, she said, because with the emergence of 5G wireless services, we are entering a whole new era of connectivity." 

Consumer tech companies, led by the Consumer Technology Association (CTA), had asked the FCC for more flexibility to import, market and pre-sell 5G devices before the FCC approves their use, something they say is critical to winning the race to 5G.

The FCC had severely limited the import of devices pre-authorization and disallowed conditional marketing and sales to consumers.

The FCC voted Thursday (June 17) to allow up to 12,000 devices to be imported for certain pre-sale activities, including packaging and shipping to retail, but not for display or demonstration.

Loosening the rules will help companies get funding for new devices, a point Commissioner Geoffrey Starks made when he talked about the big bucks--over $5 billion--that Kickstarter campaigns have raised pre-sale for a host of new products.

The item also allows for conditional sales to consumers so long as they are not delivered before the device is authorized. But companies must clearly disclose to consumers that the sale is conditioned on approval, and lets them know what happens and what their options are if that approval is not secured.

“We are thrilled the FCC voted on CTA’s request to revise its decades-old rules to now offer companies more opportunities to import and sell highly sought-after devices directly to consumers," said CTA President Gary Shapiro. "As Americans rapidly shifted to working, learning and receiving medical care online during the pandemic, the need for 5G and other next-generation devices became even more important. CTA members are racing to meet the consumer demand for these connected devices, and these new rules will allow companies to get essential products into consumers’ hands faster.”

“We applaud the FCC’s action today to implement practical revisions that will ensure timely and effective marketing and delivery of 5G products and services," said SVP, regulatory affairs, Scott Bergmann. "Wireless consumers are accustomed to a highly-competitive and fast-moving marketplace. By updating these outdated rules, the FCC is removing unnecessary restrictions to better meet these expectations while ensuring proper safeguards remain in place.”

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.