Texas SB 140: What Franchise Brands Need to Know About the New SMS Rules

Disclaimer: The following is FranFunnel’s interpretation of Texas Senate Bill 140 as it relates to SMS and phone communications. This post is for informational purposes only and should not be taken as legal advice. Each business should review the law independently and consult its own legal counsel to determine specific obligations.

Why This Matters

Starting September 1, 2025, Texas Senate Bill 140 (SB 140) goes into effect. It expands the state’s telemarketing laws and specifically brings SMS/MMS messaging under stricter rules.

Because many franchise brands use FranFunnel to follow up with leads — including prospects located in Texas — it’s important to understand what’s changing and how it may apply to your business.

We believe that most of our customers will remain largely unaffected. That’s because most FranFunnel usage involves responding to inbound leads with the goal of arranging a next conversation or meeting. Texas law (§ 302.059) specifically exempts parties whose calls or texts are limited to setting up face-to-face (or virtual) sales presentations — as long as no sale or payment happens during the message itself. In practice, that’s exactly how most of you use FranFunnel.

Key Provisions of SB 140

Here are the main takeaways:

1. SMS and MMS are now explicitly regulated.
   The law treats text messages the same as phone calls if they are used to “solicit, promote, or advertise.”
2. Quiet hours are mandatory.
   Messages may only be sent to Texas residents:
   • Monday–Saturday: 9 a.m. to 9 p.m. local Texas time
   • Sunday: 12 p.m. (noon) to 9 p.m. local Texas time
3. Outbound marketers face new registration requirements.
   Companies that proactively reach out to Texas residents may be required to:
   • Register with the Texas Secretary of State
   • Pay a $200 annual fee
   • Post a $10,000 security deposit (bond or letter of credit)
   • File quarterly reports with sales representative details
4. Stronger consumer protections.
   • Opt-outs must be honored immediately.
   • Consent should be explicit and documented.
5. Enforcement risk is higher.
   Violations are tied into the Texas Deceptive Trade Practices Act, which expands potential liability and penalties.

The Meeting-Setup Exemption

One of the most relevant carve-outs in SB 140 is for parties that limit their calls or texts to arranging a sales presentation. If your use of FranFunnel is about scheduling a call or demo — not closing a deal over SMS — this exemption may apply.

Important caveats:

• You must still respect Texas quiet hours (9a–9p M-Sat, 12p–9p Sun).
• You must still honor opt-outs instantly.
• If your messages cross into sales language (pricing, persuasion, or attempting to transact by text), the exemption may not protect you.

There are many other exemptions as well

• Exemptions generally apply only to “sellers,” except as modified by § 302.060.
• Entities already regulated under specific state or federal regimes (securities firms, insurance firms, depository institutions, certain utilities, communications carriers, and CFTC-registered parties) are exempt.
• Solicitors of media subscriptions, periodic-shipment merchandise (with advance consent), or products offered through qualifying large-format catalogs are exempt.
• Educational institutions and § 501(c)(3) nonprofit organizations are exempt.
• Sales to purchasers who intend to resell or use goods in a recycling, reuse, remanufacturing, or manufacturing process are exempt.
• Persons soliciting the sale of food are exempt.
• Solicitations for maintenance or repair of previously purchased goods, or solicitations to former or current customers of a business operating under the same name for at least two years, are exempt.
• Parties that limit calls to arranging face-to-face sales presentations, or retailers operating under the same name for at least two years where sales occur primarily at the retail location, are exempt.
• A service provider that has operated under the same name for at least three years and derives at least 75 percent of its solicitation business from exempt entities is itself exempt.
• Individuals making isolated solicitations that are not part of a pattern of repeated, similar transactions are exempt.

Inbound vs. Outbound Messaging

Most FranFunnel customers rely on inbound leads (prospects who fill out a form requesting more info). Some also use outbound campaigns (cold prospecting). The distinction matters:

Inbound Lead Follow-Up (Lower Risk)

• When a lead provides their information, there’s usually clear consent to be contacted.
• These use cases often align with the meeting-setup exemption (§ 302.059).
• Brands should still:
  • Include consent language on lead forms (“By submitting, you agree to receive texts about…”).
  • Respect quiet hours for Texas numbers.
  • Process opt-outs instantly.

Outbound Campaigns (Higher Risk)

• Cold texting Texas residents is squarely covered by SB 140.
• Outbound campaigns break into two categories:
  • Meeting-setup texts only → May qualify for exemption under § 302.059.
  • Promotional or sales texts → Likely trigger registration, bond, and reporting obligations.
• Outbound users should carefully review obligations with their legal counsel.

What You Should Do

• If you’re inbound only / meeting-setup:
  • Double-check your lead forms for opt-in language.
  • Be sure messages respect quiet hours for Texas leads.
  • Keep records of consent.
  • Keep texts focused on arranging conversations — avoid treating SMS as the sales pitch itself.
• If you’re outbound into Texas:
  • If your texts are limited to meeting setup, you may qualify for exemption under § 302.059.
  • If your texts include sales language, registration and bond obligations may apply.
  • Use FranFunnel’s tools to stay within time restrictions and document opt-outs.

Helpful Resources

• Texas Legislature SB 140 (official text)
• Lowenstein: Texas “Mini-TCPA” Goes Into Effect September 1, 2025

Bottom Line

For most franchise brands using FranFunnel to follow up with inbound leads, the practical impact of SB 140 is small — but not zero. Quiet hours and consent documentation matter more than ever.

For outbound senders into Texas, the law introduces real obligations and potential consequences. But if your outreach is limited to arranging meetings, you may qualify for an exemption that avoids registration and bond requirements.

Either way, FranFunnel is here to help make compliance simple, so you can keep the fo