[Federal Register Volume 82, Number 157 (Wednesday, August 16, 2017)]
[Notices]
[Pages 38907-38909]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-17318]
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FEDERAL TRADE COMMISSION
Agency Information Collection Activities; Proposed Collection;
Comment Request
AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').
ACTION: Notice.
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SUMMARY: The information collection requirements described below will
be submitted to the Office of Management and Budget (OMB) for review,
as required by the Paperwork Reduction Act (PRA). The FTC seeks public
comments on its proposal to extend, for three years, the current PRA
clearance for information collection requirements contained in its Use
of Prenotification Negative Option Plans (``Negative Option Rule'' or
``Rule''). That clearance expires on November 30, 2017.
DATES: Comments must be submitted by October 16, 2017.
ADDRESSES: Interested parties may file a comment online or on paper by
following the instructions in the Request for Comments part of the
SUPPLEMENTARY INFORMATION section below. Write ``Negative Option Rule:
FTC File No. P064202'' on your comment, and file your comment online at
https://ftcpublic.commentworks.com/ftc/NegOptionPRA by following the
instructions on the Web-based form. If you prefer to file your comment
on paper, mail your comment to the following address: Federal Trade
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite
CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the
following address: Federal Trade Commission, Office of the Secretary,
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex
J), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Requests for additional information
should be addressed to John Andrew Singer, Attorney, Division of
Enforcement, Bureau of Consumer Protection, Federal Trade Commission,
600 Pennsylvania Avenue NW., CC-9528, Washington, DC 20580, (202) 326-
3234.
SUPPLEMENTARY INFORMATION: Under the PRA, 44 U.S.C. 3501-3521, federal
agencies must obtain approval from
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OMB for each collection of information they conduct or sponsor.
``Collection of information'' means agency requests or requirements
that members of the public submit reports, keep records, or provide
information to a third party. 44 U.S.C. 3502(3); 5 CFR 1320.3(c). As
required by section 3506(c)(2)(A) of the PRA, the FTC is providing this
opportunity for public comment before requesting that OMB extend the
existing clearance for the information collection requirements
contained in the Negative Option Rule, 16 CFR part 425 (OMB Control
Number 3084-0104).
The FTC invites comments on: (1) Whether the proposed collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility, and clarity of the information to be collected; and (4) ways
to minimize the burden of the collection of information on those who
are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology, e.g., permitting electronic
submission of responses.
The Negative Option Rule governs the operation of prenotification
subscription plans. Under these types of plans, a seller provides a
consumer with automatic shipments of merchandise such as when a
consumer joins as a member in a seller's book of the month club, food
of the month club, or clothing items of the month club unless the
consumer affirmatively notifies the seller they do not want the
shipment. The Rule requires that a seller notify a member that they
will automatically ship merchandise to the member and bill the member
for the merchandise if the subscriber fails to expressly reject the
merchandise beforehand within a prescribed time. The Rule protects
consumers by: (a) Requiring that promotional materials disclose the
terms of membership clearly and conspicuously; and (b) establishing
procedures for the administration of such ``negative option'' plans.
Burden Statement
Estimated annual hours burden: 9,725 hours.
Based on industry input, staff estimates that approximately 75
existing clubs each require annually about 100 hours to comply with the
Rule's disclosure requirements. Approximately 10 new clubs come into
being each year. These figures are an increase from 2014, although
industry estimates of the number of existing clubs have fluctuated
significantly since the early 2000s.\1\ Industry sources also now
report to the Commission that, even at this higher figure, a
substantial portion of the existing clubs would make these disclosures
absent the Rule because they help foster long-term relationships with
consumers.
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\1\ The industry estimates of existing firms subject to the
Rule's disclosure requirements range from 190 (2005), 158 (2008), 45
(2011), 35 (2014) and 75 (2017). Such fluctuations have most likely
derived from changes in the national economy and trends in the
specific industries subject to the Rule.
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Over the next three years, there will be an average 85 existing
firms per year (75+85+95 / 3). Thus, the average annual hours burden
for existing firms is expected to be 8,500. The 10 new clubs entering
the market per year require approximately 125 hours to comply with the
Rule, including start up-time. Thus, the cumulative PRA burden for new
clubs is about 1,250 hours (10 clubs x 125 hours). Combined with the
estimated burden for established clubs, the total annual burden is
9,725 hours.
Estimated annual cost burden: $473,750 (solely related to labor
costs).
Based on recent data from the Bureau of Labor Statistics,\2\ the
mean hourly wage for advertising managers is approximately $57 per
hour; compensation for office and administrative support personnel is
approximately $17 per hour. Assuming that managers perform the bulk of
the work, and clerical personnel perform associated tasks (e.g.,
placing advertisements and responding to inquiries about offerings or
prices), the total cost to the industry for the Rule's information
collection requirements would be approximately $473,750 [(80 hours
managerial time x 85 existing clubs x $57 per hour) + (20 hours
clerical time x 85 existing clubs x $17 per hour) + (90 hours
managerial time x 10 new clubs x $57 per hour) + (35 hours clerical
time x 10 new clubs x $17)].
Because the Rule has been in effect since 1974, the vast majority
of the negative option clubs have no current start-up costs. For the
new clubs that enter the market each year, the costs associated with
the Rule's disclosure requirements, beyond the additional labor costs
discussed above, are de minimis. Negative option clubs already have
access to the ordinary office equipment necessary to comply with the
Rule. Similarly, the Rule imposes few, if any, printing and
distribution costs. The required disclosures generally constitute only
a small addition to the advertising for negative option plans. Because
printing and distribution expenditures are incurred to market the
product regardless of the Rule, adding the required disclosures results
in marginal incremental expense.
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\2\ Occupational Employment And Wages--May 2016, Table 1, at
https://www.bls.gov/news.release/ocwage.t01.htm.
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Request for Comment
You can file a comment online or on paper. October 16, 2017. Write
``Negative Option Rule: FTC File No. P064202'' on your comment. Your
comment--including your name and your state--will be placed on the
public record of this proceeding, including, to the extent practicable,
on the public Commission Web site, at https://www.ftc.gov/policy/public-comments. Postal mail addressed to the Commission is subject to
delay due to heightened security screening. As a result, we encourage
you to submit your comments online. To make sure that the Commission
considers your online comment, you must file it at https://ftcpublic.commentworks.com/ftc/NegOptionPRA by following the
instructions on the web based form. If this Notice appears at https://www.regulations.gov, you also may file a comment through that Web site.
If you file your comment on paper, write ``Negative Option Rule:
FTC File No. P064202'' on your comment and on the envelope, and mail
your comment to the following address: Federal Trade Commission, Office
of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex C),
Washington, DC 20580, or deliver your comment to the following address:
Federal Trade Commission, Office of the Secretary, Constitution Center,
400 7th Street SW., 5th Floor, Suite 5610, Washington, DC 20024. If
possible, submit your paper comment to the Commission by courier or
overnight service.
Because your comment will be placed on the publicly accessible FTC
Web site at www.ftc.gov, you are solely responsible for making sure
that your comment does not include any sensitive or confidential
information. In particular, your comment should not include any
sensitive personal information, such as your or anyone else's Social
Security number; date of birth; driver's license number or other state
identification number, or foreign country equivalent; passport number;
financial account number; or credit or debit card number. You are also
solely responsible for making sure that your comment does not include
any sensitive
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health information, such as medical records or other individually
identifiable health information. In addition, your comment should not
include any ``trade secret or any commercial or financial information
which . . . is privileged or confidential''--as provided by Section
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR
4.10(a)(2)--including in particular competitively sensitive information
such as costs, sales statistics, inventories, formulas, patterns,
devices, manufacturing processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular,
the written request for confidential treatment that accompanies the
comment must include the factual and legal basis for the request, and
must identify the specific portions of the comment to be withheld from
the public record. See FTC Rule 4.9(c). Your comment will be kept
confidential only if the General Counsel grants your request in
accordance with the law and the public interest. Once your comment has
been posted on the public FTC Web site--as legally required by FTC Rule
4.9(b)--we cannot redact or remove your comment from the FTC Web site,
unless you submit a confidentiality request that meets the requirements
for such treatment under FTC Rule 4.9(c), and the General Counsel
grants that request.
Visit the Commission Web site at https://www.ftc.gov to read this
Notice. The FTC Act and other laws that the Commission administers
permit the collection of public comments to consider and use in this
proceeding as appropriate. The Commission will consider all timely and
responsive public comments that it receives on or before October 16,
2017. You can find more information, including routine uses permitted
by the Privacy Act, in the Commission's privacy policy, at https://www.ftc.gov/site-information/privacy-policy.
David C. Shonka,
Acting General Counsel.
[FR Doc. 2017-17318 Filed 8-15-17; 8:45 am]
BILLING CODE 6750-01-P