What's Happening?
Texas Senate Bill 140 (SB 140) has expanded regulations on telephone solicitations to include SMS text messages, effective September 1, 2025. This law imposes stringent requirements on businesses that use text messaging for marketing purposes to Texas residents. Businesses must register with the Texas Secretary of State and post a $10,000 bond, with a registration fee of $200, renewed annually. Exemptions are limited, applying only to businesses contacting current or former customers, publicly traded companies, financial institutions, educational institutions, nonprofits, and food sellers. The law applies regardless of the business's location if the recipient resides in Texas. Messaging hours are restricted, prohibiting promotional texts after 12 p.m. on Sundays and during overnight hours. Non-compliance can lead to fines up to $5,000 per violation, triple damages, attorney fees, and mental anguish awards, with no cap on total liability.
Why It's Important?
The implementation of SB 140 significantly impacts businesses engaging in SMS marketing in Texas, increasing operational costs and legal risks. Companies must navigate complex compliance requirements, potentially affecting marketing strategies and consumer outreach. The law's stringent penalties for non-compliance could lead to substantial financial exposure, especially for small businesses. This regulatory change reflects a broader trend towards increased consumer protection in digital communications, potentially influencing similar legislation in other states. Businesses must adapt to these changes to avoid litigation and financial penalties, which could affect their bottom line and market presence.
What's Next?
Litigation challenging SB 140 on First Amendment grounds has been filed, but it may take time before clarity on the law's constitutionality is achieved. Businesses, marketers, and consumers await potential judicial decisions that could alter or uphold the current provisions. In the interim, companies must ensure compliance with SB 140 to mitigate risks. The outcome of these legal challenges could set precedents for future regulations on digital marketing practices, influencing how businesses communicate with consumers.
