[Federal Register Volume 76, Number 229 (Tuesday, November 29, 2011)]
[Notices]
[Pages 73640-73644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-30434]


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FEDERAL TRADE COMMISSION


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

AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Notice and request for comment.

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SUMMARY: The information collection requirements described below are 
being submitted to the Office of Management and Budget (OMB) for 
review, as required by the Paperwork Reduction Act (PRA). The FTC is 
seeking public comments on proposed information requests to beverage 
alcohol advertisers that will seek information concerning, among other 
things, sales and marketing expenditures, compliance with voluntary 
advertising placement provisions, digital marketing practices and data 
collection, and lesser-known media programs.

DATES: Comments must be received on or before December 29, 2011.

ADDRESSES: Interested parties may submit written comments by following 
the instructions in the ``Request for Comments'' part of the 
SUPPLEMENTARY INFORMATION section below.

FOR FURTHER INFORMATION CONTACT: Requests for copies of the collection 
of information and supporting documentation should be addressed to 
Janet M. Evans, Attorney, 202-326-2125, or Carolyn L. Hann, Attorney, 
202-326-2745, Division of Advertising Practices, Bureau of Consumer 
Protection, Federal Trade Commission.

SUPPLEMENTARY INFORMATION: The FTC has previously published reports on 
voluntary advertising self-regulation by the alcohol industry in 
September 1999, September 2003, and June 2008.\1\ The data contained in 
the reports were based on information submitted to the Commission, 
pursuant to compulsory process, by U.S. beverage alcohol advertisers. 
The FTC has authority to compel production of this information from 
advertisers under Section 6 of the Federal Trade Commission Act (FTC 
Act), 15 U.S.C. 46. The Commission believes that it is in the public 
interest to: (1) Collect updated data from alcohol advertisers on sales 
and marketing expenditures, compliance with voluntary advertising 
placement provisions, digital marketing practices and data collection, 
and lesser-known media programs; and (2) publish a report on the data 
obtained.
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    \1\ See FTC, Self-Regulation in the Alcohol Industry (Sept. 
1999), available at http://www.ftc.gov/reports/alcohol/alcoholreport.shtm; FTC, Alcohol Marketing and Advertising (Sept. 
2003), available at http://www.ftc.gov/os/2003/09/alcohol08report.pdf; and FTC, Self-Regulation in the Alcohol 
Industry (June 2008) (``2008 FTC Alcohol Report''), available at 
http://www.ftc.gov/os/2008/06/080626alcoholreport.pdf.
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    Under the PRA, 44 U.S.C. 3501-3521, federal agencies must obtain 
approval from 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).
    On February 25, 2011, the Commission sought comment on the 
information collection requirements associated with this proposal. 76 
FR 10596. (60-Day Notice). As required by OMB regulations, 5 CFR part 
1320, the FTC is providing this second opportunity for public comment 
while seeking OMB approval for the collection of information.

A. Public Comments/Consultation Outside the Agency

    The FTC received 71 comments in response to the 60-Day Notice. Of 
these, four comments favored and substantively addressed the proposed 
data collection. These comments were submitted by: (1) State Attorneys 
General representing 23 states and one territory \2\ (State AG); (2) 
the Center for

[[Page 73641]]

Alcohol Marketing and Youth (CAMY); (3) the Center for Digital 
Democracy (CDD); \3\ and (4) University of Connecticut School of 
Medicine (UConn Medical School). One comment, submitted by The Marin 
Institute, offered substantive recommendations but also expressed 
concerns about self-regulation.\4\ Two additional comments offered 
limited recommendations regarding the proposed data collection.\5\ The 
remaining 64 comments did not substantively address the proposed data 
collection.\6\
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    \2\ The State AGs represented: Arizona, Connecticut, Delaware, 
Guam, Hawaii, Idaho, Illinois, Iowa, Maryland, Massachusetts, 
Mississippi, Nevada, New Hampshire, New Mexico, New York, Oklahoma, 
Oregon, Rhode Island, South Carolina, Tennessee, Utah, Vermont, 
Washington, and Wyoming.
    \3\ CDD, Alcohol Marketing in the Digital Age (May 2010) (``CDD 
White Paper''). A private citizen also submitted the CDD White Paper 
as an attachment to her comment.
    \4\ See further discussion about The Marin Institute comment at 
Section A.3.c, below.
    \5\ These were submitted by a private citizen in Michigan (also 
referenced in note 3, above) and the Mesilla Valley DWI Resource 
Center in New Mexico. The recommendations in these comments are 
discussed in notes 11 and 13, below.
    \6\ See discussion at Section A.3., below.
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1. General Support for the Data Collection

    In its 60-Day Notice, the FTC sought comments regarding whether the 
proposed collection of information is necessary for the proper 
performance of the functions of the FTC.\7\ The State AG and CAMY 
comments expressed strong support for the FTC's proposed data 
collection. Specifically, they stated that this information was 
essential to the FTC's performance of its regulatory duties and in the 
public interest.
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    \7\ See 60-Day Notice, 76 FR 10596, 10597 (Feb. 25, 2011).
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2. Suggestions for Improvements to Proposed Information Collection

    In its 60-Day Notice, the FTC invited comments regarding ways to 
enhance the quality, utility, and clarity of the information to be 
collected.\8\ The FTC received substantive suggestions for enhancing 
its proposed collection of alcohol advertising data regarding the 
following specifications: (1) Expenditure data; (2) advertising 
placement; and (3) digital marketing and data collection. The FTC also 
received several suggestions that did not fall within a particular 
specification.
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    \8\ See 60-Day Notice, id. at 10597.
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a. Expenditure Data
    In its 60-Day Notice, the FTC stated that it would seek company 
data regarding expenditures to advertise and promote beverage alcohol 
in measured and non-measured media. The State AG and CAMY comments 
exhorted the FTC to seek advertising and promotional expenditures from 
the alcohol industry on an ``ongoing and regular basis,'' rather than 
intermittently. Both comments explained that the media landscape is 
changing daily. To understand how and where industry is advertising and 
to what extent the youth are exposed, the comments argued, the FTC 
should obtain these data from industry every two to three years, if not 
annually.\9\ The FTC will consider this recommendation in the course of 
developing its report.
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    \9\ While the FTC has not sought these data on an annual basis, 
it has been actively monitoring the alcohol industry. The FTC has 
collected expenditure data as part of its ongoing study and report 
process since the late 1990s. These studies have resulted in reports 
issued in 1999, 2003, and 2008. Since 2008, the staff has engaged in 
both formal and informal monitoring of alcohol self-regulatory 
efforts. For example, between 2009 and 2010, the Commission issued 
6(b) Orders to six mid-sized alcohol companies.
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b. Advertising Placement Issues
    Until very recently, the voluntary codes of the Beer Institute, the 
Distilled Spirits Council of the United States, and/or the Wine 
Institute (collectively, ``voluntary codes'') each stated that alcohol 
advertising should be placed in television, radio, and print 
communications only where at least 70% of the audience is reasonably 
expected to be above the legal purchase age (the ``70% placement 
standard'').\10\ In the 60-Day Notice, the FTC stated that it planned 
to seek data on advertising placement, including industry compliance 
with the 70% placement standard.
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    \10\ On May 26, 2011, the Beer Institute and the Distilled 
Spirits Council of the United States (``DISCUS'') each announced 
that they would increase their placement standard from 70% to 71.6% 
to reflect the recently published results of the 2010 U.S. Census 
data, which showed that 71.6 percent of the U.S. population is 21 
years of age and older. See Beer Institute press release, ``Beer 
Institute Revises Advertising Standard Based on New U.S. Census 
Data'' (May 26, 2011), available at http://www.beerinstitute.org/BeerInstitute/files/ccLibraryFiles/Filename/000000001167/Updated%20Ad%20Code%20with%20Census%20Data%20-%20FINAL%205-26-11.pdf; DISCUS, ``Distilled Spirits Industry Updates Advertising 
Guidelines Based on Newly Released Census Data'' (May 26, 2011), 
available at http://www.discus.org/media/press/article.asp?NEWS_ID=631. To date, the Wine Institute has not announced any changes to 
its placement standard.
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    The State AG and CAMY comments encouraged the FTC to recommend that 
the voluntary codes increase their placement standard from 70% to 
85%.\11\ Citing a 2004 recommendation by the Institute of Medicine's 
Committee on Developing a Strategy to Reduce and Prevent Underage 
Drinking, the State AG and CAMY comments argued that youth exposure to 
alcohol advertising on television has grown since 2004 at a rate faster 
than that of adults or young adults. The State AG and CAMY comments 
also highlighted as an example Beam Global Spirits & Wine Inc., an 
alcohol company that since 2007 has voluntarily and gradually increased 
its placement standard to 85% for its aggregate average by brand and by 
medium. The FTC will consider these recommendations in the course of 
developing its report.
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    \11\ This recommendation to increase the placement standard to 
85% was echoed by a private commenter from Michigan.
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    The State AG and CAMY comments recommended that the FTC seek brand-
specific placement data and provide a brand analysis in its upcoming 
report. The UConn Medical School comment also recommended that the FTC 
seek data in connection with specific ads or ad campaigns. The 
Commission's compulsory process orders to alcohol companies will, as 
they have in the past, collect advertising placement data for each 
individual ad for individual brands. In the course of reviewing these 
data, the FTC will evaluate whether specific brands have placement 
compliance problems. Nonetheless, because Section 6(f) of the FTC Act, 
15 U.S.C. 46(f), protects confidential commercial information that is 
submitted to the agency, the Commission cannot publicly identify 
advertising data on particular brands or companies.
c. Digital Marketing and Data Collection
    In its 60-Day Notice, the FTC stated that it would seek information 
from the alcohol industry about data collection efforts, including data 
collection in connection with digital and social media marketing, and 
efforts to avoid collection of data from youth under the legal drinking 
age of 21. The FTC received extensive and detailed recommendations 
regarding its proposed collection of digital marketing and data 
collection. These recommendations were provided by the CDD, the State 
AGs, CAMY, and The Marin Institute.
    The CDD White Paper expressed concern that online advertising has 
evolved without sufficient public analysis or regulatory oversight. It 
outlined key concepts and practices that have been guiding the growth 
of interactive marketing in the alcohol industry, including the 
creation of a ``high-definition media and marketing ecosystem'' \12\ 
that integrates

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advertising, editorial content, audience measurement, and content 
delivery; the growth of distribution platforms such as social media, 
online video channels, and virtual worlds; and targeted marketing to 
the African-American and Latino communities.
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    \12\ It particularly noted three aspects of the high-definition 
media and marketing ecosystem: (a) Engagement, i.e., the creation of 
a marketing environment where consumers interact with brands and 
integrate them into their personal and social relationships; (b) 
data collection and behavioral targeting, such as digital 
advertising campaigns that encourage users to provide their personal 
information in order to participate in a design contest; and (c) a 
``360-degree strategy'' that aims to keep consumers continuously 
plugged into their advertising campaigns, whether they are online or 
in the real world.
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    The State AG comment observed that alcohol advertising has 
substantially increased its presence online. The comment identified one 
brand that advertises solely in social media and another company that 
employed ``extensive, world-wide use of social media'' for a recent 
World Cup-related advertising campaign.\13\ The CAMY comment echoed the 
concerns cited by the State AG comment.
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    \13\ Similarly, the Mesilla Valley DWI Resource Center comment 
stated that the FTC should seek information regarding the extent to 
which the alcohol industry is shifting its advertising to the 
Internet and to what extent those Web sites and social media sites 
are following the voluntary codes.
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    Accordingly, the CDD, State AG, CAMY, and The Marin Institute 
comments requested that the FTC seek a variety of information regarding 
digital marketing and data collection practices. These practices 
included: Marketing and data collection on both corporate-sponsored Web 
sites as well as Web sites operated by third parties, age-verification 
mechanisms on such Web sites, and marketing practices on social media 
sites.
    The FTC's information requests will take account of the comments 
and changing technology and seek information about alcohol companies' 
digital marketing and data collection practices, including data 
collected about consumers on corporate-sponsored Web sites and those 
operated by third parties. The FTC will consider these commenters' 
recommendations about digital marketing and data collection in the 
course of developing its report.
d. Lesser-Known Media Programs
    The UConn Medical School comment recommended that the FTC 
specifically seek expenditure data for product placements in television 
and film, including the type of product depicted and to whom the 
compensation was paid. The FTC's information requests will seek 
expenditure data for product placements in general, as well as the type 
and title of the entertainment vehicle in which such product placement 
appeared, and whether compensation was made in the form of monetary 
payment or an in-kind provision (e.g., products or other logoed items).
e. Other Recommendations About Data Collection
    The UConn Medical School comment offered many recommendations for 
the types of data the FTC should seek in its data collection. In 
particular, the comment suggested gathering specific data about the 
voluntary codes' complaint review procedures and the composition of 
their complaint review boards. For example, the comment recommended 
that the FTC seek data regarding the complaint review process, such as 
procedures for evaluating complaints. The comment also recommended that 
the FTC seek information regarding the qualifications, compensation, 
and conflicts of interest of complaint review board members.\14\
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    \14\ The UConn Medical School comment also suggested that the 
FTC gather specific information about advertising strategy, content, 
and substantiation. The comment recommended that the FTC seek a 
variety of data, ranging from the ages of actors who appeared in 
alcohol advertising for television and print to substantiation for 
health benefits claims made about low-carbohydrate beers. The 
Commission believes the level of specificity in these 
recommendations exceeds the scope of the study.
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    The Commission agrees that complaint review procedures are a 
critical component of self-regulation. In past studies, the compulsory 
process orders specifically sought information about the complaint 
review process from individual companies; ultimately, the information 
was provided voluntarily by the three alcohol trade associations. 
Similarly, for this study, the Commission plans to seek information 
about the complaint review process and related issues from the trade 
associations.

3. Other Comments

    As noted earlier, the FTC received 64 comments in response to the 
60-Day Notice that did not address the proposed data collection. These 
comments fall into three broad categories: (1) Comments opposing the 
FTC's study concept in general; (2) comments seeking stricter self-
regulation; and (3) comments calling for an end to self-regulation, to 
be replaced by a government ban or curtailing of alcohol advertising.
a. Comments Opposing Study Concept
    Three comments expressed disagreement with the general concept of 
studying the alcohol industry. These were submitted by: (1) One 
university; (2) one non-governmental organization; and (3) one 
anonymous commenter. Each of these commenters offered a different 
reason: One argued that there was no causal connection between alcohol 
advertising and youth drinking; another argued that the damage already 
had been done, so the FTC's study would come too late; and the final 
one argued that ``we are taxed enough'' without adding anything further 
other than requesting confidential treatment. As noted earlier, the FTC 
believes that its information requests are in the public interest and 
essential to the agency's performance of its regulatory duties.
b. Comments Seeking Stricter Self-Regulation
    Two comments advocated for more ``teeth'' in self-regulation. 
First, the Cambridge Prevention Coalition and Bluegrass Prevention 
comments advocated for objective standards to judge the content of 
alcohol advertising. Second, the Bluegrass Prevention comment stated 
that the alcohol industry should be required to take reasonable steps 
to ensure that their brands are not promoted by fans and other third 
parties online (e.g., social media) in a way that violates the 
voluntary codes. The FTC will consider these recommendations in the 
course of developing its report.
c. Comments Calling for an End to Self-Regulation
    The vast majority of comments received--60--called for an end to 
alcohol industry self-regulation and advocated for more active 
government regulation. These were submitted by: (1) Five local 
government agencies; (2) 24 non-governmental agencies; (3) two 
religious organizations; (4) one research institute; and (5) 28 
individuals. The Marin Institute comment described industry self-
regulation as a ``complete failure.'' Marin, along with an individual 
commenter, called for the existing compliance review boards to be 
replaced by a ``truly independent third party review board that 
includes public interest representatives.'' Other comments, including 
many submitted by individuals, called for alcohol advertising to be 
banned or curtailed to reduce the likelihood of youth exposure to the 
ads.

B. Information Requests to the Beverage Alcohol Industry

    The FTC proposes to send information requests to the ultimate U.S. 
parent companies of up to fourteen advertisers of beer, wine, or 
distilled spirits (``industry members''). The requests will seek, among 
other

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information, data regarding: (1) Sales of beverage alcohol; (2) 
expenditures to advertise and promote beverage alcohol in measured and 
non-measured media; (3) compliance with the 70% placement standard 
contained in the industry's self-regulatory codes as of January 1, 
2011; (4) digital marketing practices and data collection, including 
efforts to avoid collection of data from youth under the legal drinking 
age of 21; and (5) descriptions of lesser-known media programs, such as 
point-of-sale advertising, product placement, and social responsibility 
programs. A description of the proposed specifications, subject to 
further public comment, is located at http://www.ftc.gov/fedreg2011/11/111121alcoholstudypra2supp.pdf.
    It should be noted that subsequent to this notice, any destruction, 
removal, mutilation, alteration, or falsification of documentary 
evidence that may be responsive to this information collection within 
the possession or control of a person, partnership, or corporation 
subject to the FTC Act may be subject to criminal prosecution. 15 
U.S.C. 50; see also 18 U.S.C. 1505.

C. Estimated Annual Hours and Labor Cost Burdens

1. Estimated Hours Burden: 8,680 Hours

    The staff's estimate of the hours burden is based on the time 
required to respond to each information request. Because beverage 
alcohol companies vary in size, the number of products they sell,\15\ 
and the extent and variety of their advertising and promotion efforts, 
the staff has provided a range of the estimated hours burden. As noted 
above, each company will receive information requests pertaining to 
five categories of information.
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    \15\ In 2007, the top 12 alcohol suppliers alone reported 
selling 1,133 brands. See 2008 FTC Alcohol Report, available at 
http://www.ftc.gov/os/2008/06/080626alcoholreport.pdf.
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    Based upon its knowledge of the industry, the staff estimates, on 
average, that the time required to gather, organize, format, and 
produce responses to the proposed orders will range between 300 and 620 
hours per company. The total estimated burden per company is based on 
the following assumptions:
    (1) Identify, obtain, and organize sales information, prepare 
response: 30-70 hours.
    (2) Identify, obtain, and organize information on advertising and 
marketing expenditures, prepare response: 50-130 hours.
    (3) Identify, obtain, and organize placement information, prepare 
response: 120-280 hours.
    (4) Identify, obtain, and organize information regarding digital 
marketing practices and data collection, prepare response: 80-100 
hours.
    (5) Identify, obtain, and organization information regarding 
lesser-known media programs: 20-40 hours.
    Conservatively, the staff estimates that the burden per company for 
each of up to fourteen intended recipients will be 620 hours. 
Accordingly, the staff estimates a total burden for these companies of 
approximately 8,680 hours (14 companies x 620 average burden hours per 
company). These estimates include any time spent by separately 
incorporated subsidiaries and other entities affiliated with the 
ultimate parent company that has received the information request.

2. Estimated Cost Burden: $186,000

    It is difficult to calculate with precision the labor costs 
associated with the information requests, as the costs entail varying 
compensation levels of management and/or support staff among companies 
of different sizes. Financial, legal, marketing, and clerical personnel 
may be involved in the information collection process. The staff has 
assumed that professional personnel and outside legal counsel will 
handle most of the tasks involved in gathering and producing responsive 
information, and has applied an average hourly wage of $300/hour for 
their labor. Thus, the staff estimates that the total labor costs per 
company will range between $90,000 ($300 x 300 hours) and $186,000 
($300 x 620 hours).
    The staff estimates that the capital or other non-labor costs 
associated with the information requests will be minimal. Although the 
information requests may necessitate that industry members maintain the 
requested information provided to the Commission, they should already 
have in place the means to compile and maintain business records.

D. Request for Comment

    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before December 29, 
2011. Write ``Alcohol Reports: Paperwork Comment; Project No. P114503'' 
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 http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the 
Commission tries to remove individuals' home contact information from 
comments before placing them on the Commission Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information such as an individual'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 also are 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which is obtained from any person and which is privileged or 
confidential * * *, '' as provided in Section 6(f) of the FTC Act, 15 
USC 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, 
do not include competitively sensitive information such as costs, sales 
statistics, inventories, formulas, patterns, devices, manufacturing 
processes, or customer names.
    If you would like the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you must follow the procedure explained in 
FTC Rule 4.9(c), 16 CFR 4.9(c). Your comment will be kept confidential 
only if the FTC General Counsel, in his or her sole discretion, grants 
your request in accordance with the law and the public interest.
    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, or to send them to the Commission by courier or 
overnight service. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/alcoholstudy2011pra2, by following the instructions on the web-
based form. If this Notice appears at http://www.regulations.gov, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``Alcohol Reports: 
Paperwork Comment; Project No. P114503'' on your comment and on the 
envelope, and mail or deliver it to the following address: Federal 
Trade Commission, Office of the Secretary, Room H-113 (Annex J), 600 
Pennsylvania Avenue NW, Washington, DC 20580. If possible, submit your

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paper comment to the Commission by courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. 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 December 29, 2011. You can find more 
information, including routine uses permitted by the Privacy Act, in 
the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.shtm.
    Comments on the information collection requirements subject to 
review under the PRA should also be submitted to OMB. If sent by U.S. 
mail, address comments to: Office of Information and Regulatory 
Affairs, Office of Management and Budget, Attention: Desk Officer for 
the Federal Trade Commission, New Executive Office Building, Docket 
Library, Room 10102, 725 17th Street NW., Washington, DC 20503. 
Comments sent to OMB by U.S. postal mail, however, are subject to 
delays due to heightened security precautions. Thus, comments instead 
should be sent by facsimile to (202) 395-5167.

David C. Shonka,
Acting General Counsel.
[FR Doc. 2011-30434 Filed 11-28-11; 8:45 am]
BILLING CODE 6750-01-P