[Federal Register Volume 82, Number 123 (Wednesday, June 28, 2017)]
[Proposed Rules]
[Pages 29251-29253]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-13470]


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FEDERAL TRADE COMMISSION

16 CFR Part 303

RIN 3084-AB28


Rules and Regulations Under the Textile Fiber Products 
Identification Act

AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission proposes amending the Textile Rules (``Rules 
and Regulations under the Textile Fiber Products Identification Act'') 
to delete the requirement that an owner of a registered word trademark 
furnish the FTC with a copy of the mark's registration with the United 
States Patent and Trademark Office (``USPTO'') before using the mark on 
labels, and to no longer restrict the use of such trademarks to only 
those also employed as house marks. Eliminating these requirements is 
expected to reduce compliance costs while increasing firms' 
flexibility.

DATES: Written comments must be received on or before July 31, 2017.

ADDRESSES: Interested parties may file a comment online or on paper by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``Textile Rules, 16 CFR 
part 303, Project No. P948404'' on your comment, and file your comment 
online at https://ftcpublic.commentworks.com/ftc/textilerulesnprm by 
following the instructions on the web-based form. If you prefer to file 
your comment on paper, mail your comment to the following address: 
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania 
Avenue NW., Suite CC-5610 (Annex C), Washington, DC 20580, or deliver 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, 
Suite 5610 (Annex C), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Robert M. Frisby, Attorney, (202) 326-
2098, Federal Trade Commission, Division of Enforcement, Bureau of 
Consumer Protection, 600 Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

I. Introduction

    The Commission recently announced a new initiative to eliminate or 
change outdated, unnecessary regulations and processes.\1\ While the 
textile regulation at issue here does not impose large costs on 
business, the cumulative burden of unnecessary regulations can impose 
significant costs and undermine the efficiency with which government 
delivers services to the public. With these concerns in mind, the 
Commission now proposes eliminating the requirement in 16 CFR 303.19(a) 
that businesses furnish the Commission with registered word trademarks 
prior to using these marks to satisfy the Textile Rules. Eliminating 
this requirement is expected to reduce compliance costs while 
increasing firms' flexibility.
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    \1\ https://www.ftc.gov/news-events/press-releases/2017/04/process-reform-initiatives-are-already-underway-federal-trade.>
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    Specifically, the Textile Fiber Products Identification Act 
(``Textile Act'')\2\ and implementing rules (``Textile Rules'') require 
marketers to, among other things, attach a label to each covered 
textile product disclosing: (1) The generic names and percentages by 
weight of the constituent fibers in the product; (2) the name under 
which the manufacturer or other responsible company does business or, 
in lieu thereof, the company's registered identification number (``RN 
number''); and (3) the name of the country where the product was 
processed or manufactured.\3\ Section 303.19 allows the owners of 
registered word trademarks who use these trademarks as house marks to 
disclose such trademarks on labels in lieu of their business names. 
However, before doing so, the company must file a copy of the 
trademark's USPTO registration with the Commission. This requirement 
was imposed in 1959 presumably to obviate

[[Page 29252]]

the need for the Commission to obtain from the USPTO paper copies of 
trademark registrations. However, the registered marks can be found by 
searching online or at the USPTO's Web site (www.uspto.gov). The 
Commission, therefore, proposes to eliminate the requirement for 
businesses to file paper copies of the registration with the Commission 
because it appears unnecessary and could in some cases impose 
unnecessary costs on businesses.
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    \2\ 15 U.S.C. 70 et seq.
    \3\ See 15 U.S.C. 70b(b).
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II. Proposed Amendment

    The Commission promulgated Sec.  303.19 in 1959 at the time it 
issued the Textile Rules, and the provision has not changed since.\4\ 
When the Commission issued the Rules, neither the Commission nor 
consumers could identify easily the owners of word trademarks. Thus, at 
the time, the regulation provided some benefit (i.e., facilitating the 
identification of trademark owners to address compliance issues or help 
consumers contact textile product marketers).
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    \4\ See 24 FR 4480, 4484 (June 2, 1959).
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    Now, Commission staff and consumers can identify trademark owners 
by searching online or on the USPTO's online database. Accordingly, the 
regulation is no longer necessary. The Commission, therefore, proposes 
to amend Sec.  303.19(a) to delete this requirement. In addition to 
potentially reducing compliance costs for textile marketers, deleting 
this requirement would eliminate the Commission's need to process and 
maintain trademark registration records, freeing those resources for 
more productive uses.\5\
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    \5\ If the Commission adopts this amendment, it plans to destroy 
its word trademark registration records, except to the extent that 
retaining such records is necessary to comply with federal statutes, 
regulations, or other legal authority.
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    Additionally, there appears to be no reason to restrict the use of 
word trademarks to only those also employed as house marks.\6\ In the 
past, it was difficult for consumers to research registered marks, and, 
therefore, it made sense to require companies to use marks that 
consumers could easily identify with a particular company. Consumers 
now can identify trademark owners online or look up the trademark 
registrations online at the USPTO, and, therefore, the rationale for 
limiting the use of marks no longer seems to be necessary. In addition, 
removing this requirement would give companies the flexibility to use 
any registered word mark.
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    \6\ A house mark is a mark used on a wide range of goods sold by 
a company.
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III. Request for Comments

    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before July 31, 2017. 
Write ``Textile Rules, 16 CFR part 303, Project No. P948404'' on your 
comment. Your comment--including your name and your state--will be 
placed on the public record of this proceeding, including, to the 
extent practicable, on the public Commission Web site, at https://www.ftc.gov/policy/public-comments.
    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/textilerulesnprm, by following the instruction on the web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``Textile Rules, 16 CFR 
part 303, Project No. P948404'' on your comment and on the envelope, 
and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite 
CC-5610 (Annex C), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
C), Washington, DC 20024. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Because your comment will be placed on the publicly accessible FTC 
Web site at https://www.ftc.gov, you are solely responsible for making 
sure that your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including in particular competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request, and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public FTC Web site--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the FTC Web site, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    Visit the Commission Web site to read this NPRM 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 
July 31, 2017. For information on the Commission's privacy policy, 
including routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.
    The Commission invites members of the public to comment on the 
costs and benefits to industry members and consumers, as well as any 
issues or concerns they believe are relevant or appropriate to the 
Commission's consideration of the proposed amendment to the Textile 
Rules. The Commission requests that comments provide factual data upon 
which they are based.

IV. Communications to Commissioners and Commissioner Advisors by 
Outside Parties

    Written communications and summaries or transcripts of oral 
communications respecting the merits of this proceeding from any 
outside party to any Commissioner or

[[Page 29253]]

Commissioner's advisor will be placed on the public record.\7\
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    \7\ See 16 CFR 1.26(b)(5).
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V. Regulatory Flexibility Act Requirements

    The Regulatory Flexibility Act (``RFA'') \8\ requires that the 
Commission conduct an analysis of the anticipated economic impact of 
the proposed amendment on small entities. The purpose of a regulatory 
flexibility analysis is to ensure that an agency considers the impacts 
on small entities and examines regulatory alternatives that could 
achieve the regulatory purpose while minimizing burdens on small 
entities. Section 605 of the RFA \9\ provides that such an analysis is 
not required if the agency head certifies that the regulatory action 
will not have a significant economic impact on a substantial number of 
small entities.
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    \8\ 5 U.S.C. 601-612.
    \9\ 5 U.S.C. 605.
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    The Commission believes that the proposed amendment would not have 
a significant economic impact upon small entities, although it may 
affect a substantial number of small businesses. In the Commission's 
view, the proposed amendment should not increase the costs of small 
entities that manufacture or import textile fiber products. Therefore, 
based on available information, the Commission certifies that amending 
the Rules as proposed will not have a significant economic impact on a 
substantial number of small businesses. Although the Commission 
certifies under the RFA that the proposed amendment would not, if 
promulgated, have a significant impact on a substantial number of small 
entities, the Commission has determined, nonetheless, that it is 
appropriate to publish an Initial Regulatory Flexibility Analysis to 
inquire into the impact of the proposed amendment on small entities. 
Therefore, the Commission has prepared the following analysis:

A. Description of the Reasons That Action by the Agency Is Being Taken

    The Commission proposes amending the Rules to delete one 
requirement and provide greater flexibility in complying with the 
Rules' disclosure requirements.

B. Statement of the Objectives of, and Legal Basis for, the Proposed 
Amendment

    The Textile Act authorizes the Commission to implement its 
requirements through the issuance of rules. The proposed amendment 
would delete the requirement that word trademark owners disclosing 
their trademarks in lieu of their business names on labels furnish a 
copy of their trademark registrations to the Commission, and provide 
covered entities with additional labeling options (i.e., to use word 
trademarks in lieu of business name, even if such trademarks are not 
house marks) without imposing new burdens or additional costs.

C. Small Entities to Which the Proposed Amendments Will Apply

    The Rules apply to various segments of the textile fiber product 
industry, including manufacturers and wholesalers of textile apparel 
products. Under the Small Business Size Standards issued by the Small 
Business Administration, textile apparel manufacturers qualify as small 
businesses if they have 500 or fewer employees. Clothing wholesalers 
qualify as small businesses if they have 100 or fewer employees. The 
Commission's staff has estimated that approximately 22,642 textile 
fiber product manufacturers and importers are covered by the Rules' 
disclosure requirements.\10\ A substantial number of these entities 
likely qualify as small businesses. The Commission estimates that the 
proposed amendment will not have a significant impact on small 
businesses because they do not impose any new obligations on them.
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    \10\ 80 FR 1411, 1413 (Jan. 9, 2015).
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D. Projected Reporting, Recordkeeping, and Other Compliance 
Requirements, Including Classes of Covered Small Entities and 
Professional Skills Needed To Comply

    As explained earlier in this document, the proposed amendment would 
delete a filing requirement and a limitation on the use of word 
trademarks on textile labels, thus providing greater flexibility to 
companies covered by the Rules. The small entities potentially covered 
by the proposed amendment will include all such entities subject to the 
Rules.

E. Duplicative, Overlapping, or Conflicting Federal Rules

    The Commission has not identified any other federal statutes, 
rules, or policies that would duplicate, overlap, or conflict with the 
proposed amendment.

F. Significant Alternatives to the Proposed Amendment

    The Commission has not proposed any specific small entity exemption 
or other significant alternatives because the proposed amendment would 
not impose any new requirements or compliance costs.

VI. Paperwork Reduction Act

    The Rules contain various ``collection of information'' (e.g., 
disclosure and recordkeeping) requirements for which the Commission has 
obtained clearance from the Office of Management and Budget (``OMB'') 
under the Paperwork Reduction Act (``PRA'').\11\ The proposed amendment 
does not impose any additional collection of information requirements.
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    \11\ 44 U.S.C. 3501 et seq. The Commission published its PRA 
burden estimates for the current information collection requirements 
under the Rules. See 80 FR at 1411, 1413 (Jan. 9, 2015) and 80 FR 
14387, 14388 (Mar. 19, 2015). In April 2015, OMB granted clearance 
through April 30, 2018, for these requirements and the associated 
PRA burden estimates. The OMB control number is 3084-0101.
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List of Subjects in 16 CFR Part 303

    Advertising, Labeling, Recordkeeping, Textile fiber products.

    Accordingly, the FTC proposes to amend 16 CFR part 303 as follows:

PART 303--RULES AND REGULATIONS UNDER THE TEXTILE FIBER PRODUCTS 
IDENTIFICATION ACT

0
1. The authority citation for part 303 continues to read as follows:

    Authority: 15 U.S.C. 70 et seq.

0
2. Amend Sec.  303.19 by revising paragraph (a) to read as follows:


Sec.  303.19  Name or other identification required to appear on 
labels.

    (a) The name required by the Act to be used on labels shall be the 
name under which the person is doing business. Where a person has a 
word trademark, registered in the United States Patent and Trademark 
Office, such word trademark may be used on labels in lieu of the name 
otherwise required. No trademark, trade names, or other names except 
those provided for above shall be used for required identification 
purposes.
* * * * *

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2017-13470 Filed 6-27-17; 8:45 am]
BILLING CODE 6750-01-P