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Federal Register / Vol. 70, No.

168 / Wednesday, August 31, 2005 / Notices 51817

and salary actions) involving individual Washington, DC 20580. Because paper For the Franchise Rule, contact
Federal ReserveSystem employees. mail in the Washington area and at the Steven Toporoff, Attorney, Division of
2. Any items carried forward from a Commission is subject to delay, please Marketing Practices, Bureau of
previously announced meeting. consider submitting your comments in Consumer Protection, Federal Trade
FOR FURTHER INFORMATION CONTACT: electronic form, (in ASCII format, Commission, 600 Pennsylvania Ave.,
Michelle A. Smith,Director, Office of WordPerfect, or Microsoft Word) as part NW., Washington, DC 20580, (202) 326–
Board Members; 202–452–2955. of or as an attachment to e-mail 3135.
SUPPLEMENTARY INFORMATION: You may messages directed to the following For the R-Value Rule, contact
call202–452–3206 beginning at e-mail box: Hampton Newsome, Attorney, Division
approximately 5 p.m. two businessdays PaperworkComment@ftc.gov. However, of Enforcement, Bureau of Consumer
before the meeting for a recorded if the comment contains any material for Protection, Federal Trade Commission,
announcement of bank and bankholding which confidential treatment is 600 Pennsylvania Ave., NW.,
company applications scheduled for the requested, it must be filed in paper Washington, DC 20580, (202) 326–2889.
meeting; or you may contactthe Board’s form, and the first page of the document For the Administrative Activities
Web site at http:// must be clearly labeled ‘‘Confidential.’’ 1 clearance, contact J. Ronald Brooke Jr.,
www.federalreserve.gov for anelectronic All comments should additionally be Attorney, Division of Planning and
announcement that not only lists submitted to: Office of Management and Information, Bureau of Consumer
applications, but alsoindicates Budget, Attention: Desk Officer for the Protection, Federal Trade Commission,
procedural and other information about Federal Trade Commission. Comments 600 Pennsylvania Ave., NW.,
the meeting. should be submitted via facsimile to Washington, DC 20580, (202) 326–3484.
(202) 395–6974 because U.S. Postal Mail SUPPLEMENTARY INFORMATION: On May
Board of Governors of the Federal Reserve
System, August 26, 2005.
is subject to lengthy delays due to 19, 2005, the FTC sought comment on
heightened security precautions. the information collection requirements
Robert deV. Frierson, The FTC Act and other laws the
Deputy Secretary of the Board. associated with the Negative Option
Commission administers permit the Rule, 16 CFR part 425 (OMB Control
[FR Doc. 05–17396 Filed 8–29–05; 8:51 am] collection of public comments to Number 3084–0104); the Amplifier
BILLING CODE 6210–01–S consider and use in this proceeding as Rule, 16 CFR part 432 (OMB Control
appropriate. All timely and responsive Number 3084–0105); the Franchise
public comments will be considered by Rule, 16 CFR part 436 (OMB Control
FEDERAL TRADE COMMISSION the Commission and will be available to Number 3084–0107); the R-Value Rule,
the public on the FTC Web site, to the 16 CFR part 460 (OMB Control Number
Agency Information Collection extent practicable, at http://www.ftc.gov.
Activities; Proposed Collection; 3084–0109); and the clearance covering
As a matter of discretion, the FTC makes the FTC’s administrative activities
Comment Request; Extension every effort to remove home contact (OMB Control Number 3084–0047). 70
AGENCY: Federal Trade Commission information for individuals from the FR 28937. As discussed below, one
(‘‘Commission’’ or ‘‘FTC’’). public comments it receives before comment relating to the clearance for
ACTION: Notice.
placing those comments on the FTC administrative activities was received.
Web site. More information, including Pursuant to the OMB regulations that
SUMMARY: The information collection routine uses permitted by the Privacy implement the PRA (5 CFR part 1320),
requirements described below will be Act, may be found in the FTC’s privacy the FTC is providing this second
submitted to the Office of Management policy at http://www.ftc.gov/ftc/ opportunity for public comment while
and Budget (‘‘OMB’’) for review, as privacy.htm. seeking OMB approval to extend the
required by the Paperwork Reduction FOR FURTHER INFORMATION CONTACT: existing paperwork clearance for the
Act (‘‘PRA’’) (44 U.S.C. 3501–3520). The Requests for additional information or rule. All comments should be filed as
FTC is seeking public comments on its copies of the proposed information prescribed in the ADDRESSES section
proposal to extend through August 31, requirements should be addressed as above, and must be received on or
2008, the current Paperwork Reduction follows: before September 30, 2005.
Act clearances for information For the Negative Option Rule, contact
collection requirements contained in Edwin Rodriguez, Attorney, Division of 1. The Negative Option Rule, 16 CFR
four Commission rules and one Enforcement, Bureau of Consumer Part 425 (OMB Control Number: 3084–
clearance covering the Commission’s Protection, Federal Trade Commission, 0104)
administrative activities. Those 600 Pennsylvania Ave., NW., The Negative Option Rule governs the
clearances expire on August 31, 2005. Washington, DC 20580, (202) 326–3147. operation of prenotification subscription
DATES: Comments must be received on For the Amplifier Rule, contact Neil plans. Under these plans, sellers ship
or before September 30, 2005. Blickman, Attorney, Division of merchandise, such as books, compact
ADDRESSES: Interested parties are Enforcement, Federal Trade discs, or tapes, automatically to their
invited to submit written comments. Commission, Bureau of Consumer subscribers and bill them for the
Comments should refer to ‘‘Paperwork Protection, 600 Pennsylvania Ave., NW., merchandise if consumers do not
Comment: FTC File No. P822108’’ to Washington, DC 20580, (202) 326–3038. expressly reject the merchandise within
facilitate the organization of comments. a prescribed time. The Rule protects
1 Commission Rule 4.2(d), 16 CFR 4.2(d). The
A comment filed in paper form should consumers by: (a) requiring that
comment must be accompanied by an explicit
include this reference both in the text request for confidential treatment, including the
promotional materials disclose the
and on the envelope and should be factual and legal basis for the request, and must terms of membership clearly and
mailed or delivered, with two complete identify the specific portions of the comment to be conspicuously; and (b) establishing
copies, to the following address: Federal withheld from the public record. The request will procedures for the administration of
be granted or denied by the Commission’s General
Trade Commission/Office of the Counsel, consistent with applicable law and the
such ‘‘negative option’’ plans.
Secretary, Room H–135 (Annex J), 600 public interest. See Commission Rule 4.9(c), 16 CFR Estimated annual hours burden:
Pennsylvania Avenue, NW., 4.9(c). 15,000 hours.

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51818 Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices

Staff estimates that approximately 190 regardless of the Rule to market the specifications. Because this Rule
existing clubs require annually about 75 product, adding the required disclosures became effective in 1974 and because
hours each to comply with the Rule’s to them would result in marginal members of the industry are familiar
disclosure requirements, for a total of incremental expense. with its requirements, compliance is
14,250 hours (190 clubs × 75 hours). less burdensome today. Accordingly,
2. The Amplifier Rule, 16 CFR Part 432
These clubs should be familiar with the staff continues to estimate the time
(OMB Control Number: 3084–0105)
Rule, which has been in effect since involved for this task to be a maximum
1974, with the result that the burden of The Amplifier Rule assists consumers of 1⁄4 hour for each new specification
compliance has declined over time. by standardizing the measurement and sheet and brochure (600 × .25 hours), for
Moreover, a substantial portion of the disclosure of power output and other a total annual burden of 150 hours. The
existing clubs likely would make these performance characteristics of total annual burden imposed by the
disclosures absent the Rule because they amplifiers in stereos and other home Rule, therefore, is approximately 450
have helped foster long-term entertainment equipment. The Rule also burden hours for testing and
relationships with consumers. specifies the test conditions necessary to disclosures.
Approximately 5 new clubs come into make the disclosures that the Rule Estimated annual cost burden:
being each year. These clubs require requires. $16,000, rounded to the nearest
approximately 120 hours to comply Estimated annual hours burden: 450 thousand (solely relating to labor costs).
with the Rule, including start- up time. hours (300 testing-related hours; 150 Based on recent data from the Bureau
Thus, cumulative PRA burden for new disclosure-related hours). of Labor Statistics, the average hourly
clubs is about 600 hours. Combined The Rule’s provisions require affected compensation for electronics engineers
with the estimated burden for entities to test the power output of is about $36, and the average hourly
established clubs, total burden is 14,850 amplifiers in accordance with a compensation for advertising and
hours or 15,000, rounded to the nearest specified FTC protocol. The staff promotions managers is about $36.
thousand. estimates that approximately 300 new Generally, electronics engineers perform
Estimated annual cost burden: amplifiers and receivers come on the the testing of amplifiers and receivers
$490,000, rounded to the nearest market each year. High fidelity (300 hours × $36 = $10,800), and
thousand (solely related to labor costs). manufacturers routinely conduct advertising or promotions managers
Based on recent data from the Bureau performance tests as part of any new prepare product brochures and
of Labor Statistics, the average product development. As a result, the manufacturer specification sheets
compensation for advertising managers Rule imposes incremental costs only to (including required disclosures) (150
is approximately $36 per hour. the extent that the FTC protocol is more hours × $36 = $5,400). Based on this
Compensation for clerical personnel is time-consuming than alternative testing information, staff estimates industry
approximately $13 per hour. Assuming procedures. Specifically, a warm up labor costs associated with the Rule of
that managers perform the bulk of the (‘‘precondition’’) period that the Rule approximately $16,000 per year,
work, while clerical personnel perform requires before measurements are taken rounded to the nearest thousand.
associated tasks (e.g., placing may add approximately one hour to the The Rule imposes no capital or other
advertisements and responding to time testing entails. Thus, staff estimates non-labor costs because its requirements
inquiries about offerings or prices), the that the Rule imposes approximately are incidental to testing and advertising
total cost to the industry for the Rule’s 300 hours (1 hour × 300 new products) done in the ordinary course of business.
paperwork requirements would be of added testing burden annually.
approximately $489,750 [(65 hours The Rule requires disclosures if a 3. The Franchise Rule, 16 CFR Part 436
managerial time × 190 existing negative media advertisement makes a power (OMB Control Number: 3084–0107)
option plans × $36 per hour) + (10 hours output claim or if a manufacturer The Franchise Rule requires
clerical time × 190 existing negative specification sheet and product franchisors and franchise brokers to
option plans × $13 per hour) + (110 brochure for a covered product make a furnish to prospective investors a
hours managerial time × 5 new negative power output claim. This requirement disclosure document that provides
option plans × $36 per hour) + (10 hours does not impose any additional costs on information relating to the franchisor,
clerical time × 5 new negative option manufacturers because, absent the Rule, the franchisor’s business, the nature of
plans × $13)]. media advertisements, as well as the proposed franchise relationship, as
Because the Rule has been in effect manufacturer specification sheets and well as additional information about
since 1974, the vast majority of the product brochures, simply would any claims concerning actual or
negative option clubs have no current contain a power specification obtained potential sales, income, or profits for a
start-up costs. For the few new clubs using an alternative to the Rule-required prospective franchisee (‘‘financial
that enter the market each year, the testing protocol. The Rule, though, also performance claims’’). The franchisor
costs associated with the Rule’s requires disclosure of harmonic must also preserve the information that
disclosure requirements, beyond the distortion, power bandwidth, and forms a reasonable basis for such claims.
additional labor costs discussed above, impedance ratings in manufacturer The FTC is seeking to extend the PRA
are de minimis. Negative option clubs specification sheets and product clearance for the existing Rule. In
already have access to the ordinary brochures. The staff’s research suggests addition, the FTC is seeking PRA
office equipment necessary to achieve that approximately 300 new amplifiers clearance for the rule changes that have
compliance with the Rule. Similarly, the and receivers are introduced each year. been proposed in the ongoing
Rule imposes few, if any, printing and The cost of disclosing the ancillary rulemaking proceeding.
distribution costs. The required distortion, bandwidth, and impedance Estimated annual hours burden for
disclosures generally constitute only a information in the potentially 600 new existing Franchise Rule: 33,500 hours.
small addition to the materials that a specification sheets and brochures The Rule’s required disclosure
prospective subscriber sends to the produced each year for those products document provides franchisees with
seller to solicit enrollment in a negative (300 × 2) is limited to the time needed information on broad-ranging subjects
option plan. Because printing and to draft and review the language that affect franchisors and the nature of
distribution expenditures are incurred pertaining to the aforementioned the proposed franchise relationship.

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Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices 51819

This includes not only generally which could take up to an additional harmonizing federal and state disclosure
available information, such as the hour of recordkeeping per year. This laws.
official name and address and principal yields a cumulative total of 5,000 hours Third, the amended Rule would
place of business of the franchisor, but per year for affected entities. require the disclosure of more
also less commonly available Estimated annual cost burden for information on the quality of the
information, such as, among other existing rule: $7,190,000. franchise relationship. Among other
things, the previous five years business Labor costs are determined by things, franchisors would disclose
experience of a franchisor’s current applying applicable wage rates to litigation initiated against franchisees
directors and executive officers and associated burden hours. Staff assumes involving the franchise relationship and
whether any of these individuals have that an attorney likely would prepare or franchisee-specific trademark
been convicted of a felony or fraud or update the disclosure document. associations.
have filed for bankruptcy or been Accordingly, staff’s estimate of the labor Fourth, the amended Rule would
adjudged bankrupt during the previous costs attributed to those tasks are as update the rule to address new
seven years. All information in the follows: (500 new franchisors × $250 per technologies. Specifically, it would
disclosure statement must be updated hour × 30 hours per franchisor) + (4,500 permit franchisors to furnish disclosures
and revised according to the express established franchisors × $250 per hour electronically. This includes
time requirements set forth in the Rule. × 3 hours per franchisor) = $7,125,000. transmission via CD ROM, e-mail, and
Based on a review of the trade Staff anticipates that recordkeeping access to a Web site.
publications and information from state would be performed by clerical staff at Finally, the amended Rule would
regulatory authorities, staff believes approximately $13 per hour. At 5,000 reduce compliance costs by expanding
that, on average, from year to year, there hours per year for all affected entities, exemptions from disclosure.
are approximately 5,000 American this would amount to a total cost of Specifically, the amended Rule would
franchise systems, consisting of 2,500 $65,000. Thus, combined labor costs for create new exemptions for sophisticated
business format franchises and 2,500 recordkeeping and disclosure is investors and for sales to managers and
business opportunity sellers, with approximately $7,190,000. others within the franchise system who
approximately 500 (or 10%) of the total are already familiar with the franchise
Estimated increase in annual hours
reflecting new entrants who have system’s operations.
burden for proposed rule amendments:
replaced departing businesses. Staff has
2750 hours. At the same time, the amended Rule
calculated burden based on the above
The Commission is conducting a would increase franchisors’
estimates. Some franchisors, however,
rulemaking proceeding to amend the recordkeeping obligations. Specifically,
for various reasons, are not covered by
Franchise Rule. 64 FR 57294 (1999) a franchisor would be required to retain
the Rule in certain situations (e.g., when
(Notice of Proposed Rulemaking). The copies of receipts for disclosure
a franchisee buys bona fide inventory
Staff Report on the Proposed Revised documents, as well as materially
but pays no franchisor fees). Moreover,
Franchise Rule (Aug. 25, 2004) (‘‘Staff different versions of its disclosure
fifteen states have franchise disclosure
laws similar to the Rule. These states Report’’), which is available online at documents. Such recordkeeping
use a disclosure document format http://www.ftc.gov, sets forth the staff’s requirements are consistent with, or less
known as the Uniform Franchise recommendations to the Commission on burdensome, than those imposed by the
Offering Circular (‘‘UFOC’’). In order to various proposed amendments to the states.
ease compliance burdens on the Franchise Rule. The Commission did Staff estimates the increase in burden
franchisor, the Commission has not review or approve the staff report attributable to the proposed Rule
authorized use of the UFOC in lieu of prior to its issuance. See 69 FR 53661 amendments as follows: Each year,
its own disclosure format to satisfy the (2004) (Notice Announcing Publication approximately 250 new franchisors will
Rule’s disclosure requirements. Staff of Staff Report). Among other things, the require 32 hours each (2 hours more
estimates that about 95 percent of all Rule amendments discussed in the Staff than under the existing Rule) to develop
franchisors use the UFOC format. When Report would accomplish five goals. a Rule-compliant disclosure document
that format is used, the franchisor is not First, the staff has recommended that (increase of 500 hours). Staff also
required to prepare an additional federal the amended Rule address the sale of estimates that during the first year that
disclosure document. The burden hours business format and product franchises the amended Rule is effective, the
stated below reflect staff’s estimate of exclusively. The existing requirements remaining 2250 established franchisors
the incremental burden that the for business opportunity ventures will require approximately 6 hours each
Franchise Rule may impose beyond would be renumbered as a separate rule (3 hours more than under the existing
information requirements imposed by limited to business opportunities only. Rule) to update their existing disclosure
states and/or followed by franchisors See Staff Report at 13 and n.42. document to comply with the amended
who use the UFOC. Accordingly, the burden for business Rule (increase of 6750 hours for the first
Staff estimates that the 500 or so new opportunity ventures will remain the year). After the first year, however, the
franchisors (including business same. time required should be the same as
opportunity ventures) require Second, the amended Rule would under the existing Rule, as the new
approximately 30 hours each to develop reduce inconsistencies between federal disclosure format becomes familiar.
a Rule-compliant disclosure document. and state disclosure requirements. Accordingly, the increase in the annual
Staff additionally estimates that the Fifteen states have franchise disclosure disclosure burden, averaged over the
remaining 4,500 established franchisors laws similar to the Rule. These states three-year clearance period, will be
require no more than approximately 3 use a disclosure document format 2750 hours (500 hours per year for new
hours each to update the disclosure known as the Uniform Franchise franchisors + 2250 hours per year for
document. The combined cumulative Offering Circular (‘‘UFOC’’). Staff established franchisors).
burden is 28,500 hours. estimates that about 95 percent of all Estimated increase in annual cost
The franchisor may need to maintain franchisors use the UFOC format. The burden for proposed rule amendments:
additional documentation for the sale of amended Rule would incorporate nearly $688,000, rounded to the nearest
franchises in non-registration states, all of the UFOC disclosures, thereby thousand.

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51820 Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices

Labor costs are determined by manufacturers × 20 hours) + (6 The Rule requires that the
applying applicable wage rates to manufacturers × 80 hours)]. approximately 25,000 retailers who sell
associated burden hours. Staff assumes While the Rule imposes home insulation make fact sheets
that an attorney likely would prepare recordkeeping requirements, most available to consumers before purchase.
the disclosure document. Accordingly, manufacturers and their testing This can be accomplished by, for
staff’s estimate of the increase in labor laboratories keep their testing-related example, placing copies in a display
costs that would be attributable to the records in the ordinary course of rack or keeping copies in a binder on a
proposed Rule amendments, averaged business. Staff estimates that no more service desk with an appropriate notice.
over the three-year clearance period, is than one additional hour per year per Replenishing or replacing fact sheets
as follows: (500 hours per year for new manufacturer is necessary to comply should require no more than
franchisors × $250 per hour) + (2250 with this requirement, for an annual approximately one hour per year per
hours per year for established recordkeeping burden of approximately retailer, for a total of 25,000 annual
franchisors × $250) = $687,500. 150 hours (150 manufacturers × 1 hour). hours, industry-wide.
Installers are required to show the The Rule also requires specific
4. R-Value Rule, 16 CFR Part 460 (OMB manufacturers’ insulation fact sheet to disclosures in advertisements or other
Control Number: 3084–0109) retail consumers before purchase. They promotional materials to ensure that the
The R-value Rule establishes uniform must also disclose information in claims are fair and not deceptive. This
standards for the substantiation and contracts or receipts concerning the burden is very minimal because retailers
disclosure of accurate, material product R-value and the amount of insulation to typically use advertising copy provided
information about the thermal install. Staff estimates that two minutes by the insulation manufacturer, and
performance characteristics of home per sales transaction is sufficient to even when retailers prepare their own
insulation products. The R-value of an comply with these requirements. advertising copy, the Rule provides
insulation signifies the insulation’s Approximately 1,520,000 retrofit some of the language to be used.
degree of resistance to the flow of heat. insulations are installed by Accordingly, approximately one hour
This information tells consumers how approximately 1,615 installers per year, per year per retailer should suffice to
well a product is likely to perform as an and, thus, the related annual burden meet this requirement, for a total annual
insulator and allows consumers to total is approximately 50,667 hours burden of approximately 25,000 hours.
determine whether the cost of the (1,520,000 sales transactions × 2 Retailers who make energy savings
insulation is justified. minutes). Staff anticipates that one hour claims in advertisements or other
per year per installer is sufficient to promotional materials must keep
Estimated annual hours burden:
cover required disclosures in records that indicate the substantiation
121,000 hours.
advertisements and other promotional they are relying upon. Because few
The Rule’s requirements include
materials. Thus, the burden for this retailers make these types of
product testing, recordkeeping, and requirement is approximately 1,615
third-party disclosures on labels, fact promotional claims and because the
hours per year (1,615 installers × 1 Rule permits retailers to rely on the
sheets, advertisements, and other hour). In addition, installers must keep
promotional materials. Based on insulation manufacturer’s substantiation
records that indicate the substantiation data for any claims that are made, the
information provided by members of the relied upon for savings claims. The
insulation industry, staff estimates that additional recordkeeping burden is de
additional time to comply with this minimis. The time calculated for
the Rule affects: (1) 150 insulation requirement is minimal—approximately
manufacturers and their testing disclosures, above, would be more than
5 minutes per year per installer—for a adequate to cover any burden imposed
laboratories; (2) 1,615 installers who sell total of approximately 135 hours (1,615
home insulation; (3) 125,000 new home by this recordkeeping requirement.
installers × 5 minutes). To summarize, staff estimates that the
builders/sellers of site-built homes and New home sellers must make contract Rule imposes a total of 120,624 burden
approximately 5,500 dealers who sell disclosures concerning the type, hours, as follows: 150 recordkeeping
manufactured housing; and (4) 25,000 thickness, and R-value of the insulation and 3,390 testing and disclosure hours
retail sellers who sell home insulation they install in each part of a new home. for manufacturers; 135 recordkeeping
for installation by consumers. Staff estimates that no more than 30 and 52,282 disclosure hours for
Under the Rule’s testing requirements, seconds per sales transaction is required installers; 14,667 disclosure hours for
manufacturers must test each insulation to comply with this requirement, for a new home sellers; and 50,000 disclosure
product for its R-value. The test takes total annual burden of approximately hours for retailers. Rounded to the
approximately 2 hours. Approximately 14,167 hours (1.7 million new home nearest thousand, the total burden is
15 of the 150 insulation manufacturers sales × 30 seconds). New home sellers 121,000 burden hours.
in existence introduce one new product who make energy savings claims must Estimated annual cost burden:
each year. The total annual testing also keep records regarding the $2,738,000, rounded to the nearest
burden is therefore approximately 30 substantiation relied upon for those thousand (solely related to labor costs).
hours (15 manufacturers × 2 hours per claims. Because few new home sellers The total annual labor costs for the
test). make these claims, and the ones that do Rule’s information collection
Staff further estimates that most would likely keep these records requirements is $2,737,902, derived as
manufacturers require an average of regardless of the R-value Rule, staff follows: $690 for testing, based on 30
approximately 20 hours per year with believes that the 30 seconds covering hours for manufacturers (30 hours × $23
regard to third-party disclosure disclosures would also encompass this per hour for skilled technical
requirements in advertising and other recordkeeping element.2
promotional materials. Only the five or no more than 30 seconds per sales transaction
six largest manufacturers require 2 In previous requests for clearance under the because of increased automation, the wide-spread
additional time, approximately 80 hours PRA, the FTC staff assumed that the requirements use of standard contracts, and the prevalence of
related to new home sales contracts require one large firms in the housing market. In addition, there
each. Thus, the annual third-party minute per sales transaction. See, e.g., 67 FR 21243, was a calculation error in the previous requests that
disclosure burden for manufacturers is 21246 (April 30, 2002). The FTC staff now estimates significantly overestimated the total burden
approximately 3,360 hours [(144 that the inclusion of such information should take imposed by new home sale contract disclosures.

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Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices 51821

personnel); $3,705 for complying with quantify. Nonetheless, in order to cover for phone complaints and 2 minutes for
the recordkeeping requirements of the any potential ‘‘collections of online complaints.
Rule, based on 285 hours (285 hours × information’’ for which separate The FTC received a comment from
$13 per hour for clerical personnel); clearance has not been sought, staff is T-Mobile USA, Inc. (‘‘T-Mobile’’)
$43,680 for manufacturers’ compliance projecting 125 hours as its estimate of contending that the FTC should require
with third-party disclosure the time needed to submit any more information from consumer
requirements, based on 3,360 hours applicable responses.4 complainants in order to reduce the
(3,360 hours × $13 per hour for clerical (b) Complaint Systems: 138,415 burden on companies such as T-Mobile
personnel); and $2,689,827 for hours. investigating complaints against them of
compliance by installers, new home possible violations of the Registry.
sellers, and retailers (116,949 hours × Consumer Response Center T-Mobile, which describes itself as a
$23 per hour for sales persons). Consumers can submit complaints nationwide commercial mobile radio
There are no significant current about fraud and other practices to the service carrier that currently serves
capital or other non-labor costs FTC’s Consumer Response Center by more than 18 million customers as well
associated with this Rule. Because the telephone or through the FTC’s website. as the largest carrier-owned Wi-Fi
Rule has been in effect since 1980, Telephone complaints and inquiries to network in the world, proposes
members of the industry are familiar the FTC are answered both by FTC staff increasing the burden on each consumer
with its requirements and already have and contractors. These telephone submitting a complaint of an unwanted
in place the equipment for conducting counselors ask for the same information telemarketing call in two ways.
tests and storing records. New products that consumers would enter on the First, T-Mobile proposes that the FTC
are introduced infrequently. Because the applicable forms available on the FTC’s require consumers to include an
required disclosures are placed on Web site. For telephone inquiries and ‘‘express description of the goods or
packaging or on the product itself, the complaints, the FTC staff estimates that services that were offered’’ or other
Rule’s additional disclosure it takes 4.5 minutes per call to gather similar information about what the call
requirements do not cause industry information, somewhat less time than was about. T-Mobile asserts it is the
members to incur any significant the 5 minutes estimated for consumers subject of some consumer complaints
additional non-labor associated costs. to enter a complaint online.5 The for exempt calls such as debt collection,
customer service inquiries, and other
burden estimate conservatively assumes
5. FTC Administrative Activities (OMB calls that do not constitute
that all of the phone call is devoted to
Control Number: 3084–0047) telemarketing. Indeed, T-Mobile
collecting information from consumers,
This category consists of: (a) emphasizes that it ‘‘does not conduct
although frequently telephone
applications to the Commission, any outbound telemarketing to anyone
counselors devote a small portion of the
including Applications and notices other than its existing subscribers,’’
call to providing requested information
contained in the Commission’s Rules of which suggests it may also receive
to consumers.
Practice (primarily Parts I, II, and IV); complaints about calls exempt from the
(b) the FTC’s consumer complaint Complaints Concerning National Do Not Registry due to an established business
systems; (c) FTC program evaluation Call Registry relationship.
The FTC declines to require this
activities and (d) Applicant Background To receive complaints from proposed field of additional information
Form. consumers of possible violations of the from all consumer complainants in
Estimated annual hours burden: rules governing the National Do Not Call order to eliminate a limited set of
139,000 hours, rounded to the nearest Registry, 16 CFR 310.4(b), the FTC complaints about exempt calls against
thousand. maintains both an online form and a toll companies like T-Mobile. Preliminarily,
(a) Applications to the Commission, free hotline with automated voice if it is true that T-Mobile is not engaged
including applications and notices response system. Consumer in telemarketing covered by the
contained in the Commission’s Rules of complainants must provide either the Registry, T-Mobile’s investigation would
Practice: 125 hours. name or telephone number of the appear to be a relatively simple matter.
Most applications to the Commission company about which they are In addition, the proposed solution is not
generally fall within the ‘‘law complaining, the phone number that a good fit for the problem asserted. For
enforcement’’ exception to the was called and the date of the call; they example, if a company such as T-Mobile
Paperwork Reduction Act.3 Over the last may also provide their name and calls for debt collection or a customer
decade, the Commission has received address so they can be contacted for service inquiry, the consumer
only one application for an exemption additional information. The FTC staff complainant may describe the call as an
under the Fair Debt Collection Practices estimates that the time required of offer about the company’s goods or
Act provisions. Staff has estimated that consumer complainants is 2.5 minutes services. Moreover, it is not at all clear
such a submission can be completed that this indirect method of reminding
well within 50 hours. Applications and 4 This includes Commission Rule of Practice
consumers that the call must be a
notices to the Commission contained in 4.11(e), 16 CFR § 4.11(e), which establishes
telemarketing call in order to be covered
other rules (generally in Parts I, II, and procedures for agency review of outside requests for
Commission employee testimony, through by the Registry would be more effective
IV of the Commission’s Rule of Practice) compulsory process or otherwise, in cases or than the FTC announcements on the
are also infrequent and difficult to matters to which the agency is not a party. The rule online complaint form and the toll-free
requires that a person who seeks such testimony
3 The ‘‘law enforcement’’ exception to the PRA submit a statement in support of the request. Staff
hotline that already inform consumers
excludes most items in this subcategory because estimates that agency personnel receive roughly 2 that certain types of calls are permitted
they involve collecting information during the such requests per month or 24 per year, and by the Registry rules.
conduct of a Federal investigation, civil action, conservatively estimates that it would require up to Second, T-Mobile suggests that the
administrative action, investigation, or audit with 2 hours to prepare the statement, for a cumulative FTC require consumers to collect,
respect to a specific party, or subsequent total of 24 hours.
adjudicative or judicial proceedings designed to 5 Because the fraud-related form is closely record and provide both the name and
determine fines or other penalties. See 44 U.S.C. patterned after the general complaint form, burden telephone number of the company about
3518(c)(1); 5 CFR 1320.4(a)(1)–(3). estimates per respondent for each are the same. which they are complaining. Because

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51822 Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices

consumer complainants may provide considers whether its complaint system Surveys
both pieces of information, and many can be improved as a part of ongoing Consumer customer satisfaction
already do so, T-Mobile’s proposal to system upgrades and may make changes surveys give the agency information
require both imposes an extra at a future date. about the overall effectiveness and
requirement on precisely those
Identity theft timeliness of the Consumer Response
consumers who are already indicating
Center (CRC). The CRC surveys roughly
that providing such additional
To handle complaints about identity 1 percent of complainants who file IDT
information is burdensome, if not
theft, the FTC must obtain more detailed or general consumer complaints.
impossible. As T-Mobile recognizes in
information than is required of other Subsets of consumers contacted
its comment, not all consumers have
complainants. Identity theft complaints throughout the year are questioned
Caller ID and they may not have *69
generally require more information about specific aspects of CRC customer
service. Furthermore, *69 service may
(such as a description of actions service. Each consumer surveyed is
not always identify the phone number
complainants have taken with credit asked several questions chosen from a
from which the call originated.
Consumers may not record the number bureaus, companies, and law list prepared by staff. The questions are
from which the call originated, enforcement, and the identification of designed to elicit information from
particularly if the call is received during multiple suspects) than general consumers about the overall
dinner or another inopportune time, consumer complaints and fraud effectiveness of the call center. Half of
which is precisely when they should be the questions ask consumers to rate CRC
complaints. In addition, the FTC is
protected from unwanted telemarketing. performance on a scale or require a yes
considering expanding the information
In addition, calls left upon a consumer’s or no response. The second half of the
required on its online complaint form
telephone answering machine or survey asks more open-ended questions
(such as collecting additional seeking a short written or verbal answer.
through call waiting service may not be information about the fraudulent
the last call received and thus would Staff estimates that each respondent will
activity at affected companies and require 4 minutes to answer the
not be identifiable using *69 service. creating an attachment summarizing all
Finally, consumer unfamiliarity with questions (approximately 20–30 seconds
of the fraudulent account activity as per question).
*69 and concerns about whether it well as all fraudulent information on the
would result in a charge to the Finally, Consumer Sentinel user
consumer’s credit report). Consumers surveys give the agency information
consumer would discourage consumers
from making complaints at all. would be able to print out a copy of the about the overall effectiveness of its
The FTC, as a law enforcement agency revised form and use it to assist them in Consumer Sentinel Network. Consumer
that enforces compliance with the completing a police report, if Sentinel allows federal, state and local
Registry, is well aware of the appropriate, and, as also may be law enforcement organizations common
investigatory burden of investigating Do necessary, an ID Theft report. See 16 access to a secure database containing
Not Call complaints by beginning with CFR 603.3 (defining the term ‘‘identity over two million complaints from
the limited information that consumers theft report’’). The FTC estimates that victims of consumer fraud and identity
provide. The FTC, as a consumer the revised form would take consumers theft. To date, Consumer Sentinel has
protection agency, is also well aware of up to 13 minutes to complete (instead over 1200 members, including law
the importance of providing consumers of the 7.5 minutes estimated for the enforcement agencies from Canada and
with a convenient means of submitting current online form). Australia. FTC staff plan to survey
complaints. The FTC must not so roughly 50% (approximately 2,500
The FTC is also planning to make
burden consumers so as to discourage respondents) of Consumer Sentinel
some revisions in the information it users each year about such things as
the submission of complaints. While
collects from consumers who call the overall satisfaction, performance, and
more information may be helpful in
some circumstances, that benefit must Consumer Response Center (CRC) with possible improvements. Generally, the
be balanced against the burden of identity theft complaints. Staff estimates surveys should take approximately 10
requiring all consumers to submit the that it will take 9 minutes per call to minutes per respondent (417 hours
additional information in all obtain identity-theft related information total).
complaints. The FTC, based on its (instead of the 8 minutes estimated for What follows are staff’s estimates of
agency experience and familiarity with the current call procedure). A burden for these various collections of
the financial and technical constraints substantial portion of identity theft- information, including the surveys. The
of operating the complaint system, has related calls typically consists of figures for the online forms and
concluded that the current complaint counseling consumers on other steps consumer hotlines are an average of
system collects the appropriate amount they should consider taking to obtain annualized volume for the respective
and type of information from relief (which may include directing programs including both current and
consumers. Accordingly, the FTC consumers to a revised online complaint projected volumes over the 3-year
declines to adopt T-Mobile’s suggestions form). The time needed for counseling clearance period sought and are
at this time. The FTC staff periodically is excluded from the estimate. rounded to the nearest thousand.

Number of
Number of Total
Activity minutes/
respondents hours
activity

Miscellaneous and fraud-related consumer complaints (phone)* ................................. 315,000 4.5 23,625
Miscellaneous and fraud-related consumer complaints (online)** ................................ 135,000 5 11,250
IDT complaints (phone)* ................................................................................................ 380,000 9 57,000
IDT complaints (online)** ............................................................................................... 128,000 13 27,733
Do-Not-Call related consumer complaints (phone) ....................................................... 82,000 2.5 3,417
Do-Not-Call related consumer complaints (online) ....................................................... 430,000 2 14,333
Customer Satisfaction Questionnaire ............................................................................ 9,600 4 640

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Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices 51823

Number of
Number of Total
Activity minutes/
respondents hours
activity

Consumer Sentinel User Surveys ................................................................................. 2,500 10 417

Totals ...................................................................................................................... 1,482,100 .............................. 138,415


* Number of consumer calls calculated by projecting over the 3-year clearance period sought 5% annual growth and a telephone contractor re-
sponse rate of 95% (contracted level of service) with regard to consumers who call the toll free lines and opt to talk to a counselor.
** Number of online collections projected from number of consumers who use the FTC’s online complaint forms noted in the text above. These
figures also assume 5% annual growth for miscellaneous and fraud-related complaints, and 8% annual growth for ID Theft online complaints,
over the 3-year clearance period requested.

Annual cost burden: Participation by the buyers will be their likely competitive effects. OPP
The cost per respondent should be voluntary. Each responding company intends to evaluate the effectiveness of
negligible. Participation is voluntary will designate the company these advocacy comments.
and will not require any labor representative most likely to have the The evaluation will target the
expenditures by respondents. There are necessary information; in all likelihood, recipients of each of the 51 written
no capital, start-up, operation, it will be a company executive and a comments, as well as 18 sponsors of the
maintenance, or other similar costs to lawyer for the company may also be relevant legislation, by means of a
the respondents. present. BC staff estimates that each written questionnaire. Most of the
(c) Program Evaluations: 355 hours. interview will take approximately one questions ask the respondent to agree or
hour to complete, with no more than an disagree with a statement concerning
Review of Divestiture Orders hour’s preparation required by each of the advocacy comment that they
The Commission issues, on average, the participants. In some instances, staff received. Specifically, these questions
approximately 10–15 orders in merger may do additional interviews with inquire as to the applicability, value,
cases per year that require divestitures. customers of the responding company persuasive influence, public effect, and
As a result of a 1999 study authorized or the monitor. Staff conservatively informative value of the FTC’s
by the OMB and conducted by the staffs estimates that for each interview, two comments. The questionnaire also
of the Bureau of Competition and the individuals (a company executive and a provides respondents with an
Bureau of Economics,6 the Bureau of lawyer) will devote two hours each to opportunity to provide additional
Competition (‘‘BC’’) intends to enhance responding to our questions for a total remarks related either to the written
its monitoring of these required of four hours. In addition, for comments received or the FTC’s
divestitures by interviewing approximately half of the divestitures, advocacy program in general.
representatives of the Commission- staff will seek to question two Participation is voluntary.
approved buyers of the divested assets additional respondents, adding four OPP staff estimates that on average,
within the first year after the divestiture participants (a company executive and a respondents will take 30 minutes or less
is completed. For the first several years lawyer for each of the two additional to complete the questionnaire. OPP staff
of this new evaluation process, respondents) devoting two hours each, does not intend to conduct any follow-
however, BC staff will be focusing on for a total of eight additional hours. up activities that would involve the
older orders and thus anticipates Assuming that staff evaluates up to 40 respondents’ participation. If all
reviewing up to 40 divestitures per year. divestitures per year during the three- respondents complete the questionnaire,
BC staff will interview representatives year clearance period, the total hours the total hours burden for the evaluation
of the buyers to ask whether all assets burden for the responding companies will be approximately 35 hours (69
required to be divested were, in fact, will be approximately 320 hours per respondents × .5 hours). OPP staff
divested;7 whether the buyer has used year ((40 × 4 hours) + (20 × 8 hours)). estimates a conservative hourly labor
the divested assets to enter the market Using the burden hours estimated cost of $250 for the time of the survey
of concern to the Commission and, if so, above, staff estimates that the total participants (primarily state
the extent to which the buyer is annual labor cost, based on a representatives and senators). Thus, the
participating in the market; whether the conservative estimated average of $425/ total annual labor cost would be
divestiture met the buyer’s expectations; hour for executives’ and attorneys’ approximately $8750 (35 hours × $250).
wages, would be approximately (d) Applicant Tracking Form: 400
and whether the buyer believes the
divestiture has been successful. BC staff $136,000 (320 hours × $425). hours.
The FTC’s Human Resources
may also interview other participants, Review of Competition Advocacy Management Office intends to survey
including customers or trustee monitors, Program job applicants on their ethnicity, race,
as appropriate. In all these interviews, The FTC’s competition advocacy and disability status in order to
staff will seek to learn about pricing and program draws on the Commission’s determine if recruitment is effectively
other basic facts regarding competition expertise in competition and consumer reaching all aspects of the relevant labor
in the markets of concern to the agency. protection matters to encourage federal pool, in compliance with management
and state legislators, courts and other directives from the Equal Opportunity
6 The Staff of the Bureau of Competition of the
state and federal agencies to consider Employment Commission. Response by
Federal Trade Commission compiled its findings
from the study in its report: A Study of the the competitive effects of their proposed applicants is optional. The information
Commission’s Divestiture Process, 1999, available actions. Since June of 2001, the FTC obtained will be used for evaluating
at http://www.ftc.gov/os/1999/08/divestiture.pdf. Office of Policy Planning (‘‘OPP’’) has recruitment only and plays no part in
7 To the extent that the staff interviews focus on
sent out 51 letters or written comments the selection of who is hired. The
a law enforcement activity (whether the party to the
order complied with all its obligations), the
to different government officials, which information is not provided to selecting
interviews are not subject to the requirements of the have advocated the passage or repeal of officials. Instead, the information is
Paperwork Reduction Act. See supra note 3. various laws or regulations based on used in summary form to determine

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51824 Federal Register / Vol. 70, No. 168 / Wednesday, August 31, 2005 / Notices

trends over many selections within a Maria Friedman, Health Insurance Specialist, Classifications and Public Health Data
given occupational or organizational Security and Standards Group, Centers for Standards Staff, NCHS, 3311 Toledo Road,
area. The information is treated in a Medicare and Medicaid Services, MS: C5– Room 2402, Hyattsville, Maryland 20782, e-
24–04, 7500 Security Boulevard, Baltimore, mail alb8@cdc.gov, telephone 301–458–4106
confidential manner. No information (diagnosis), Mady Hue, Health Insurance
MD 21244–1850, telephone: 410–786–6333
from the form is entered into the official or Marjorie S. Greenberg, Executive Specialist, Division of Acute Care, CMS, 7500
personnel file of the individual selected Secretary, NCVHS, National Center for Security Blvd., Baltimore, Maryland 21244,
and all forms are destroyed after the Health Statistics, Centers for Disease Control e-mail Marilu.Hue@cms.hhs.gov, telephone
conclusion of the selection process. The and Prevention, Room 1100, Presidential 410–786–4510 (procedures).
format of the questions on ethnicity and Building, 3311 Toledo Road, Hyattsville, Notice: Because of increased security
race are compliant with OMB Maryland 20782, telephone: (301) 458–4245. requirements, CMS has instituted stringent
Information also is available on the NCVHS procedures for entrance into the building by
requirements and comparable to those
home page of the HHS Web site: http:// non-government employees. Persons without
used by other agencies. a government I.D. will need to show an
www.nevhs.hhs.gov/ where an agenda for the
The FTC staff estimates that up to meeting will be posted when available. official form of picture I.D., (such as a
5,000 applicants will submit the form as Should you require reasonable driver’s license), and sign-in at the security
part of the new online application accommodation, please contact the CDC desk upon entering the building. Those who
process and that the form will require 5 Office of Equal Employment Opportunity on wish to attend a specific ICD–9–CM C&M
minutes to complete, for an annual (301) 458–3EEO (4336) as soon as possible. meeting in the CMS auditorium must submit
burden total of approximately 400 their name and organization for addition to
Dated: August 23, 2005. the meeting visitor list. Those wishing to
hours. James Scanlon, attend the September 29–30, 2005 meeting
Annual cost burden: Acting Deputy Assistant Secretary for Science must submit their name and organization by
The cost per respondent should be and Data Policy, Office of the Assistant September 26, 2005 for inclusion on the
negligible. Participation is voluntary Secretary for Planning and Evaluation. visitor list. This visitor list will be
and will not require any labor [FR Doc. 05–17345 Filed 8–30–05; 8:45 am] maintained at the front desk of the CMS
expenditures by respondents. There are building and used by the guards to admit
BILLING CODE 4151–05–M
no capital, start-up, operation, visitors to the meeting. Those who attended
maintenance, or other similar costs to previous ICD–9–CM C&M meetings will no
longer be automatically added to the visitor
the respondents. DEPARTMENT OF HEALTH AND list. You must request inclusion of your name
Christian S. White, HUMAN SERVICES prior to each meeting you attend. Register to
Acting General Counsel. attend the meeting on-line at: http://
Centers for Disease Control and cms.hhs.gov/events.
[FR Doc. 05–17326 Filed 8–30–05; 8:45 am] Prevention Notice: This is a public meeting. However,
BILLING CODE 6750–01–P because of fire code requirements, should the
Notice of Meeting number of attendants meet the capacity of the
room, the meeting will be closed.
National Center for Health Statistics The Director, Management Analysis and
DEPARTMENT OF HEALTH AND (NCHS), Classifications and Public Services Office, has been delegated the
HUMAN SERVICES Health Data Standards announces the authority to sign Federal Register notices
following meeting. pertaining to announcements of meetings and
National Committee on Vital and Health other committee management activities, for
Statistics: Meeting Name: ICD–9–CM Coordination and
both CDC and the Agency for Toxic
Maintenance Committee meeting.
Substances and Disease Registry.
Pursuant to the Federal Advisory Times and Dates: 9 a.m.–4 p.m., September
Committee Act, the Department of 29, 2005. 9 a.m.–4 p.m., September 30, 2005. Dated: August 24, 2005.
Health and Human Services (HHS) Place: Centers for Medicare and Medicaid B. Kathy Skipper,
announces the following advisory Services (CMS) Auditorium, 7500 Security Acting Director, Management Analysis and
Boulevard, Baltimore, Maryland. Services Office, Centers for Disease Control
committee meeting. Status: Open to the public. and Prevention.
Name: National Committee on Vital and Purpose: The ICD–9–CM Coordination and
Health Statistics (NCVHS), Subcommittee on Maintenance (C&M) Committee will hold its [FR Doc. 05–17325 Filed 8–30–05; 8:45 am]
Standards and Security (SSS). final meeting of the 2005 calendar year cycle BILLING CODE 4163–18–M
Time and Date: September 21, 2005: 9 on Thursday and Friday, September 29–30,
a.m.–5 p.m.; September 22, 2005: 8:30 a.m.– 2005. The C&M meeting is a public forum for
12 p.m. the presentation of proposed modifications to DEPARTMENT OF HEALTH AND
Place: Hubert H. Humphrey Building, 200 the International Classification of Diseases, HUMAN SERVICES
Independence Avenue SW., Room 705A, Ninth-Revision, and Clinical Modification.
Washington, DC 20201. Matters to be Discussed: Agenda items Centers for Disease Control and
Status: Open. include: Complex and simple febrile Prevention
Purpose: On the first day the seizures, family history of colonic polyps,
Subcommittee will focus on two topics: mucositis, newborn post discharge check, National Center for Environmental
introductory discussions of the issues benign prostatic hypertrophy with lower Health/Agency for Toxic Substances
surrounding matching patients with their urinary tract symptoms, acute and chronic and Disease Registry
records, and then continued explorations gingival disease, anal sphincter tear, addenda
into issues around HIPAA Return on (diagnosis), cervical stump prolapse, growth- The Community and Tribal
Investment (ROI). The second day open with guidance device/8-plate, M-brace dynamic Subcommittee of the Board of Scientific
an overview of the e-prescribing pilots spinal stabilization system, implantable Counselors (BSC), Centers for Disease
required under Medicare Modernization Act hemodynamic monitor, injection or infusion Control and Prevention (CDC), National
(MMA) and will move to continued of Levosimendan, laparoscopic hysterectomy,
discussions on the secondary use of clinical Taylor spatial frame, bifurcated vessel
Center for Environmental Health/
data. procedure, EPS studies, addenda Agency for Toxic Substances and
Contact Person for More Information: (procedures), ICD–10–Procedure Coding Disease Registry (NCEH/ATSDR):
Substantive program information as well as System (PCS) update. Teleconference.
summaries of meetings and a roster of For Further Information Contact: Amy In accordance with section 10(a)(2) of
Committee members may be obtained from Blum, Medical Systems Specialist, the Federal Advisory Committee Act

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