[Federal Register Volume 60, Number 30 (Tuesday, February 14, 1995)]
[Proposed Rules]
[Pages 8312-8313]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-3536]



 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 60, No. 30 / Tuesday, February 14, 1995 / 
Proposed Rules  
[[Page 8312]]

FEDERAL TRADE COMMISSION

16 CFR Part 307


Regulations Under the Comprehensive Smokeless Tobacco Health 
Education Act of 1986

agency: Federal Trade Commission.

action: Notice of proposed rulemaking.

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summary: On March 20, 1991, the Federal Trade Commission (``the 
Commission'') issued final regulations (56 FR 11653) amending 16 CFR 
part 307, the Commission's existing regulations pursuant to the 
Comprehensive Smokeless Tobacco Health Education Act of 1986 (``the 
Smokeless Tobacco Act''). The amendments deleted the exemption of 
utilitarian objects from the regulations, and provided a method for 
displaying and rotating the health warnings on utilitarian objects. The 
amendments also changed the requirements for the rotation of the health 
warnings on point-of-sale and non-point-of-sale promotional materials 
(``promotional materials''). On January 15, 1993, the Commission 
deleted the promotional materials portion of the 1991 amendment, 
indicating that it had failed to receive sufficient comment on this 
portion of the Regulation. At the same time, the Commission re-proposed 
its 1991 rule for promotional materials warning label rotations and 
sought comment. Some of the comments received suggested that the 
Commission should not only amend the rotational schedule for 
promotional materials, but also amend the regulations governing the 
rotation of utilitarian objects. Thus, the Commission is seeking public 
comment on whether the regulations governing the rotation schedule for 
utilitarian objects should be amended.
    All persons are hereby notified of the opportunity to submit 
written data, views, and arguments concerning the requirements for the 
rotation of health warnings on utilitarian objects.

dates: Written comments will be accepted on or before April 17, 1995.

addresses: Send comments to Secretary, Federal Trade Commission, 6th 
and Pennsylvania Avenue NW., Washington, DC 20580.

for further information contact: Phillip S. Priesman, Attorney, (202) 
326-2484, Division of Advertising Practices, Federal Trade Commission, 
6th & Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

Section A--Background

    On January 15, 1993, the Commission proposed amending 16 CFR part 
307 (58 FR 4874) to modify the rotational schedule for health warnings 
on promotional materials. Some of the comments received suggested that 
the Commission should not only amend the rotational provisions for 
promotional materials, but also amend the regulations governing the 
rotation of utilitarian objects.
    The proposed rule would provide that a satisfactory plan for 
utilitarian objects could provide for rotation according to either the 
date the object is disseminated or the date the object is ordered. It 
would also delete the exception permitting random rotation under 
certain circumstances. This exception was intended to alleviate the 
hardship caused when date of dissemination was specified as the only 
acceptable basis for a rotation schedule. The Commission currently 
permits rotation methods based on dissemination date or order date for 
promotional materials. See 58 FR 4874 (Jan. 15, 1993). The proposed 
rule for utilitarian items follows the rotation method currently in 
effect for promotional materials. However, the proposed rule would 
permit rotation based on dissemination date or order date only if the 
production of materials is carried out in a manner consistent with 
customary business practices. Thus, under the proposed rule, there 
would no longer be any need for random rotation. For these reasons, the 
Commission is proposing the deletion of the random rotation exception 
from the regulations.

Section B--Questions

    In particular, the Commission is soliciting information on the 
following questions:
    Question 1. What is the likely effect of the proposed requirements 
for the rotation of health warnings or utilitarian objects on the 
costs, profitability, competitiveness, and employment of small business 
entities?
    Question 2. The Smokeless Tobacco Act requires smokeless tobacco 
companies to submit plans to the Commission that specify the method the 
companies will use to rotate, display, and distribute the required 
health warning statements on their packaging and advertising. The 
original requirement for the submission of plans by marketers of 
smokeless tobacco products was submitted to, and approved by, the 
Office of Management and Budget. OMB Control No. 3084-0082.
    By changing the requirements for the rotation of the health 
warnings on utilitarian objects, the proposed amendments will require 
some of the smokeless tobacco companies to revise their rotational 
plans for utilitarian objects. What are the possible paperwork burdens 
that the proposed utilitarian objects amendment to 16 CFR Part 307 may 
impose?
    Question 3. What are the possible regulatory alternatives that 
would reduce the economic impact of the proposed rotational 
requirements for warning labels on utilitarian objects, yet fully 
implement the regulatory mandate of the Smokeless Tobacco Act?

Section C--Regulatory Flexibility Act

    When the Smokeless Tobacco Regulations were first proposed, the FTC 
certified that the Regulatory Flexibility Act requirement for 
regulatory analysis was not applicable because the regulations did not 
appear to have a significant economic impact on a substantial number of 
small entities. 51 FR 24378 (1986). The Commission has re-examined that 
issue with respect to the proposed amendment for utilitarian objects 
and has preliminarily determined that the proposed amendment will not 
change that determination because the amendment merely enables 
manufacturers of smokeless tobacco to modify slightly an already 
existing schedule by which they rotate the three required warnings on 
utilitarian objects. In order to ensure, however, that no substantial 
economic impact is being overlooked, public comment is requested on the 
effect of the proposed regulations on costs, profitability, 
[[Page 8313]] competitiveness, and employment of small entities.
    Subsequent to the receipt of public comments, it will be decided 
whether the preparation of a final regulatory flexibility analysis is 
warranted.
    In light of the above, it is certified that the proposed amendments 
will not have a significant economic impact on a substantial number of 
small entities. 5 U.S.C. 605(b) (1982). This notice serves as 
certification to that effect for the purposes of the Small Business 
Administration.

List of Subjects in 16 CFR Part 307

    Health warnings, Smokeless tobacco, Trade practices.

    Accordingly, it is proposed that part 307 of 16 CFR be amended as 
follows:

PART 307--REGULATIONS UNDER THE COMPREHENSIVE SMOKELESS TOBACCO 
HEALTH EDUCATION ACT OF 1986

    1. The authority for part 307 continues to read as follows:

    Authority: 15 U.S.C. 4401 et seq.

    2. Section 307.12 is amended by revising paragraph (b) to read as 
follows:


Sec. 307.12  Rotation, display, and dissemination of warning statements 
in smokeless tobacco advertising.

* * * *
    [b] Each manufacturer, packager, or importer of a smokeless tobacco 
product must submit a plan to the Commission or its designated 
representative that ensures that the three warning statements are 
rotated every 4 months in alternating sequence. There may be more than 
one system, however, that complies with the Act and these regulations. 
For example, a plan may require all brands to display the same warning 
during each 4-month period or require each brand to display a different 
warning during a given 4-month period. A plan shall describe the method 
of rotation and shall include a list of the designated warnings for 
each 4-month period during the first year for each brand. A plan shall 
describe the method that will be used to ensure the proper rotation in 
different advertising media in sufficient detail to ensure compliance 
with the Act and these regulations, although a number of different 
methods may satisfy these requirements. For example, a satisfactory 
plan for advertising in newspapers, magazines, or other periodicals 
could provide for rotation according to either the cover or closing 
date of the publication. A satisfactory plan for posters and placards, 
other than billboard advertising, could provide for rotation according 
to either the scheduled or the actual appearance of the advertising. A 
satisfactory plan for point-of-sale and non-point-of-sale promotional 
materials each as leaflets, pamphlets, coupons, direct mail circulars, 
paperback book inserts, or non-print items, or for utilitarian objects, 
could provide for rotation according to the date the materials or 
objects are ordered by the smokeless tobacco manufacturer, or the date 
the objects or materials are scheduled to be disseminated, provided 
that the production of such materials or objects is carried out in a 
manner consistent with customary business practices.
* * * * *
    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 95-3536 Filed 2-13-95; 8:45 am]
BILLING CODE 6750-01-M