BPO sector fights back against proposed US call center restrictions

The Philippines’ information technology and business process management (IT-BPM) sector has warned that American businesses could face higher operational costs if the United States (US) government pushes through with plans to discourage offshoring. Industry advocacy groups representing the IT-BPM industry submitted a position paper dated May 18 to the Federal Communications Commission (FCC), urging it to reconsider proposed offshoring policies that threaten to negatively impact the sector’s contributions to the Philippine economy. “We respectfully submit that several of the proposed measures, particularly those that would restrict offshore customer service delivery based on location, risk undermining these objectives by increasing costs, reducing service availability, and misdirecting regulatory focus away from the actual sources of consumer harm,” the paper read. The position paper was jointly signed by the IT and Business Process Association of the Philippines (IBPAP), the American Chamber of Commerce of the Philippines (AmCham), and the US-ASEAN Business Council (USABC). The groups issued their response after the FCC released a Notice of Proposed Rulemaking (NPRM) last March to explore measures that would encourage businesses to bring call center jobs back to the US and improve customer service at existing domestic facilities. Among the controversial measures are empowering customers to transfer calls to a US-based location, ensuring that calls involving certain types of sensitive information are handled domestically, and mandating that service providers disclose the location of the call center during customer interactions. The FCC also wants to require call center workers to be proficient in American Standard English and appropriately trained to resolve issues raised by US customers. The federal agency said these measures aim to address the “frustration and poor customer service” regularly experienced by consumers when connecting with offshore call centers. While the industry groups welcomed the intention to address the concerns of US consumers, they stressed there is no basis for placing the blame entirely on offshoring operations. They noted that offshore providers, particularly those in the Philippines, operate under strict contractual and regulatory frameworks imposed by US companies themselves. These frameworks cover service-level agreements, data protection obligations, and compliance requirements that already meet rigid US standards. “Absent a demonstrated causal link between offshore operations and consumer harm, location-based restrictions risk being both overinclusive and underinclusive—burdening compliant providers while failing to effectively target problematic conduct,” the groups stated. On the matter of language proficiency, the groups pointed out that Philippine call centers supporting US companies already implement rigorous language and communication benchmarks as part of their standard hiring processes. Given the country’s long-established strength in adult English proficiency, they argued that “additional English certification requirements would appear to duplicate competencies that are already established and consistently demonstrated over time.” Regarding illegal robocalls, the groups emphasized that Philippine-based providers are not the source of unlawful robocall traffic due to their strict adherence to legitimate contact-center operations. If the FCC proceeds with these restrictions, the groups explained that US companies utilizing offshore operations would see an immediate spike in overhead. “Absent the ability to utilize offshore capacity, many companies would face materially higher operating costs. These costs would, in turn, be passed on to U.S. consumers through higher prices,” they warned. Citing estimates from the employment website Indeed, the FCC noted that the average annual salary for a call center representative in the Philippines is $5,115 (roughly ₱312,600). In contrast, the average salary for the same role in the US is $66,809 (around ₱4.07 million). Instead of the proposed restrictions, the groups are urging the FCC to adopt regulatory measures focused on a risk-based, outcome-oriented approach. “A regulatory framework focused on measurable outcomes—including customer satisfaction, responsiveness, complaint resolution, cybersecurity safeguards, fraud prevention, and provider accountability—would more directly address the Commission’s concerns than broad restrictions based on service location alone,” the paper read. According to IBPAP data, the Philippine IT-BPM sector generated more than $40 billion in revenues last year, a five-percent increase from the $38 billion recorded in 2024.