[Federal Register Volume 73, Number 191 (Wednesday, October 1, 2008)]
[Notices]
[Pages 57102-57104]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-23036]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Submission for OMB 
Review; Comment Request

AGENCY: Federal Trade Commission.

ACTION: Notice.

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[[Page 57103]]

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. The Federal Trade 
Commission (``FTC'' or ``Commission'') is seeking public comments on 
its proposal to extend through October 31, 2011, the current OMB 
clearance for the information collection requirements contained in its 
Negative Option Rule. That clearance expires on October 31, 2008.

DATES: Comments must be filed by October 31, 2008.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Negative Option Rule: FTC File No. P789003'' 
to facilitate the organization of comments. A comment filed in paper 
form should include this reference both in the text and on the envelope 
and should be mailed or delivered to the following address: Federal 
Trade Commission/Office of the Secretary, Room H-135, Annex J, 600 
Pennsylvania Ave., NW, Washington, DC 20580. The FTC is requesting that 
any comment filed in paper form be sent by courier or overnight 
service, if possible, because U.S. postal mail in the Washington area 
and at the Commission is subject to delay due to heightened security 
precautions. Moreover, because paper mail in the Washington area and at 
the Agency is subject to delay, please consider submitting your 
comments in electronic form, as prescribed below. If, however, the 
comment contains any material for which confidential treatment is 
requested, it must be filed in paper form, and the first page of the 
document must be clearly labeled ``Confidential.''\1\
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    \1\ FTC Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See FTC Rule 4.9(c), 16 CFR 4.9(c).
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    Comments filed in electronic form should be submitted via the 
following weblink: (https://secure.commentworks.com/ftc-NegativeOptionpra2) (and following the instructions on the web-based 
form). To ensure that the Commission considers an electronic comment, 
you must file it on the web-based form at the weblink: (https://secure.commentworks.com/ftc-NegativeOptionpra2). If this notice appears 
at www.regulations.gov, you may also file an electronic comment through 
that website. The Commission will consider all comments that 
regulations.gov forwards to it.
    Comments should also be submitted to: Office of Management and 
Budget, Attention: Desk Officer for the Federal Trade Commission. 
Comments should be submitted via facsimile to (202) 395-6974 because 
U.S. Postal Mail is subject to lengthy delays due to heightened 
security precautions.
    The FTC Act and other laws 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, whether filed in paper or electronic 
form. Comments received will be available to the public on the FTC 
website, to the extent practicable, at www.ftc.gov. As a matter of 
discretion, the FTC makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC website. More information, including 
routine uses permitted by the Privacy Act, may be found in the FTC's 
privacy policy at (http://www.ftc.gov/ftc/privacy.shtm).

FOR FURTHER INFORMATION CONTACT: Requests for additional information 
should be addressed to Jock K. Chung, Attorney, Division of 
Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 
NJ-2122, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580, (202) 
326-2984.

SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act (``PRA''), 
44 U.S.C. 3501-3520, federal agencies must obtain approval from OMB for 
each collection of information they conduct or sponsor. On July 10, 
2008, the FTC sought comment on the information collection requirements 
pertaining to the Commission's Negative Option Rule (OMB Control Number 
3084-0104).\2\ No comments were received. Pursuant to the OMB 
regulations that implement the PRA (5 CFR Part 1320), the FTC is 
providing this second opportunity for public comment while seeking OMB 
approval to extend the existing paperwork clearance for the 
Commission's Amplifier Rule. All comments should be filed as prescribed 
in the ADDRESSES section above, and must be received on or before 
October 31, 2008.
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    \2\ 73 FR 39700.
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    The Negative Option Rule governs the operation of prenotification 
subscription plans. Under these plans, sellers notify subscribers that 
they will ship merchandise, such as books, compact discs, or tapes, 
automatically and bill the subscribers for the merchandise if the 
subscribers do not 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.
    Estimated annual hours burden: 13,000 hours rounded to the nearest 
thousand.
    Staff estimates that approximately 158 existing clubs each require 
annually about 75 hours to comply with the Rule's disclosure 
requirements, for a total of 11,850 hours (158 clubs x 75 hours). These 
clubs should be familiar with the Rule, which has been in effect since 
1974, with the result that the burden of compliance has declined over 
time. Moreover, a substantial portion of the existing clubs likely 
would make these disclosures absent the Rule because they have helped 
foster long-term relationships with consumers.
    Approximately 7 new clubs come into being each year. These clubs 
require approximately 120 hours to comply with the Rule, including 
start up-time. Thus, the cumulative PRA burden for new clubs is about 
840 hours. Combined with the estimated burden for established clubs, 
the total burden is 12,690 hours or 13,000, rounded to the nearest 
thousand.
    Estimated annual cost burden: $511,000, rounded to the nearest 
thousand (solely related to labor costs).
    Based on recent data from the Bureau of Labor Statistics found 
here: (http://www.bls.gov/news.release/pdf/ocwage.pdf), the average 
compensation for advertising managers is approximately $44 per hour. 
Compensation for office and administrative support personnel is 
approximately $15 per hour. Assuming that managers perform the bulk of 
the work, while 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 paperwork 
requirements would be approximately $510,510 [(65 hours managerial time 
x 158 existing clubs x $44 per hour) + (10 hours clerical time x 158 
existing clubs x $15 per hour) + (110 hours managerial time x 7 new 
clubs x $44 per hour) + (10 hours clerical time x 7 new clubs x $15)].
    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 
few new clubs

[[Page 57104]]

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 achieve compliance 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.

David C. Shonka,
Acting General Counsel.
[FR Doc. E8-23036 Filed 9-30-08: 8:45 am]
[Billing code: 6750-01-S]