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SJC Members Introduce Legislation To Restore Consumer Choice

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Location: Washington, DC

Senate Judiciary Committee Chairman Senator Patrick Leahy (D-Vt.) and a bipartisan group of Senators on Monday introduced legislation that would restore the ability of consumers to more easily transfer their cell phones to other wireless carriers.

"This straightforward restoring bill is about promoting consumer rights," Leahy said. "When consumers finish the terms of their contract, they should be able to keep their phones and make their own decision about which wireless provider to use."

The Unlocking Consumer Choice and Wireless Competition Act would restore an exemption to the Digital Millennium Copyright Act (DMCA) permitting consumers users to "unlock" their cell phones when their contract expires. House Judiciary Committee Chairman Bob Goodlatte (R-Va.) and Ranking Member John Conyers (D-Mich.) are expected to introduce similar, bipartisan legislation this week. The Senate bill introduced today is cosponsored by Judiciary Committee Ranking Member Chuck Grassley (R-Iowa), and Senators Orrin Hatch (R-Utah), Al Franken (D-Minn.), who chairs the Subcommittee on Privacy, Technology and the Law, and Mike Lee (R-Utah). The Senators said this narrow and common sense proposal promotes competition in the marketplace, ultimately improving consumer choice.

"As we become a more mobile society, we're choosing smart phones and other wireless devices as our prime mode of communications. It's the right thing to empower people with the freedom to use the carrier of their choice after complying with their original terms of service," Grassley said.

Hatch said, "It just makes sense that cell phone users should be able to do what they want with their phones after satisfying their initial service contract. This bill reinstates that ability, while also ensuring that copyrights are not violated."

"Right now, folks who decide to change cellphone carriers are frequently forced to buy a new phone or risk the possibility of criminal penalties, and that's just not fair for consumers," Franken said. "This bipartisan legislation will quickly allow consumers to unlock their current phones instead of having to purchase a new one. I support this commonsense solution to save consumers money."

Lee said, "Consistent with their contracts, consumers should be able to unlock their cell phones and switch carriers. This bipartisan bill provides for that freedom and helps encourage competition among wireless services as the surest way to increase consumer welfare."

Statement of Senator Patrick Leahy (D-Vt.),
Chairman, Senate Judiciary Committee,
On Introduction of the Unlocking Consumer Choice and Wireless Competition Act
March 11, 2013

Today, I am introducing bipartisan legislation that will help promote competition in the wireless industry and restore consumer choice. From 2006 until last year, an exemption to the Digital Millennium Copyright Act (DMCA) permitted cell phone users to "unlock" their cell phones when their contract expired, allowing them to change wireless providers and thereby promoting consumer choice. This exemption has enhanced competition in the cell phone market, but it was allowed to expire last year.

Over the past few weeks and months, consumers have spoken clearly -- they want to retain the right to transfer their cell phones between wireless providers, if they so choose, when their contracts expire. I agree, which is why today I am pleased to introduce the Unlocking Consumer Choice and Wireless Competition Act, along with Senator Grassley, Senator Hatch, Senator Franken, who chairs the Judiciary Committee's Subcommittee on Privacy, Technology and the Law, and Senator Lee. We are working closely with Chairman Goodlatte and members of the House Judiciary Committee to pass common sense legislation and provide consumers with better choice.

The Unlocking Consumer Choice and Wireless Competition Act reestablishes the Library of Congress's rule permitting cell phone unlocking. It also directs the Library to undertake a new proceeding to consider whether to broaden this exemption to allow unlocking of other wireless devices such as tablets. At a time when the line between phone and tablet is beginning to blur, it makes sense for the Library to consider extending this exemption to those devices as well.

The DMCA maintains an important balance between protecting copyright owners and users. It was designed to be sufficiently flexible to meet the challenges of an ever-evolving digital copyright world. Every three years, the Library of Congress conducts its public review of the exemptions permitted under the DMCA to help promote that flexibility. Unfortunately, in its most recent proceeding, there was not a sufficient record for the Library to continue the cell phone exemption, despite the strong merits of the rule. Our legislation restores the important exemption that had been in effect in previous years. Although Congress has stepped in in this instance to restore an important policy objective, I urge parties in future rulemakings to provide a more full record so that the rulemaking process can proceed as it was designed.

When I wrote the DMCA, the law was intended to allow choice and protect consumers. This straightforward restoring bill furthers that objective. When consumers finish the terms of their contract, they should be able to keep their phones and make their own decision about which wireless provider to use. They should not be forced to stay with their original provider due to software that restricts a phone to only one network. I am pleased that many wireless providers already sell unlocked phones, or will unlock phones for consumers once contracts expire, but that does not mean that consumers should face penalties under the DMCA for taking those same steps on their own. This bill will protect and promote competition in the wireless market by allowing consumers to bring their phones with them to the provider that best suits their needs.

I urge all Senators to support this narrow, commonsense legislation to protect consumers and promote competition. I ask unanimous consent that the full bill text be printed in the Record.


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