[Federal Register Volume 84, Number 188 (Friday, September 27, 2019)]
[Notices]
[Pages 51163-51165]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20967]
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FEDERAL TRADE COMMISSION
Agency Information Collection Activities; Proposed Collection;
Comment Request
AGENCY: Federal Trade Commission.
ACTION: Notice and request for comment.
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SUMMARY: In accordance with the Paperwork Reduction Act of 1995
(``PRA''), the Federal Trade Commission (``FTC'' or ``Commission'') is
seeking public comment on its proposal to extend for an additional
three years the Office of Management and Budget clearance for
information collection requirements of its Affiliate Marketing Rule,
which applies to certain motor vehicle dealers, and its shared
enforcement with the Consumer Financial Protection Bureau (``CFPB'') of
the provisions (subpart C) of the CFPB's Regulation V regarding other
entities (``CFPB Rule''). The current clearance expires on January 31,
2020.
DATES: Comments must be filed by November 26, 2019.
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 ``Affiliate Marketing
Disclosure Rule, PRA Comment: FTC File No. P0105411'' on your comment,
and file your comment online at https://www.regulations.gov, 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 J), 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 J), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Katherine McCarron, Attorney, Division
of Privacy and Identity Protection, Bureau of Consumer Protection,
Federal Trade Commission, 600 Pennsylvania Avenue NW, Room CC-8232,
Washington, DC 20580, (202) 326-2333.
SUPPLEMENTARY INFORMATION: The Dodd-Frank Wall Street Reform and
Consumer Protection Act (``Dodd-Frank Act'') was enacted on July 21,
2010.\1\ The Dodd-Frank Act transferred to the CFPB most of the FTC's
rulemaking authority for the Affiliate Marketing provisions of the Fair
Credit Reporting Act (``FCRA'').\2\ The FTC retained rulemaking
authority for its Affiliate Marketing Rule (16 CFR 680) solely for
motor vehicle dealers described in section 1029(a) of the Dodd-Frank
Act as predominantly engaged in the sale and servicing of motor
vehicles, the leasing and servicing of motor vehicles, or both.\3\
Additionally, the FTC shares enforcement authority with the CFPB for
provisions of Regulation V subpart C (12 CFR 1022.21) that apply to
entities other than those specified above.
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\1\ Public Law 111-203, 124 Stat. 1376 (2010).
\2\ 15 U.S.C. 1681 et seq.
\3\ See Dodd-Frank Act, at section 1029 (a), (c).
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As mandated by section 214 of the Fair and Accurate Credit
Transactions Act (``FACT Act''), Public Law 108-159 (Dec. 6, 2003), the
Affiliate Marketing Rule (``Rule'') requires covered entities to
provide consumers with notice and an opportunity to opt out of the use
of certain information before sending marketing solicitations. The Rule
generally provides that, if a company communicates certain information
about a consumer (eligibility information) to an affiliate, the
affiliate may not use it to make or send solicitations to the consumer
unless the consumer is given notice and a reasonable opportunity to opt
out of such use of the information and does not opt out.
To minimize compliance costs and burdens for entities, particularly
any small businesses that may be affected, the Rule contains model
disclosures and opt-out notices that may be used to satisfy the
statutory requirements. The Rule also gives covered entities
flexibility to satisfy the notice and opt-out requirement. Covered
entities may send the consumer a free-standing opt-out notice to
satisfy the Rule's requirements or add the opt-out notice to privacy
notices already provided to consumers, such as those provided in
accordance with the provisions of Title V, subtitle A of the Gramm
Leach Bliley Act (``GLBA'').\4\ As a result, the time necessary to
prepare or incorporate an opt-out notice is likely to be minimal
because covered entities may either use the model disclosure verbatim
or base their own disclosures upon it. Moreover, verbatim adoption of
the model notice does not constitute a PRA ``collection of
information.'' \5\ The Rule also provides that affiliated companies may
send a joint disclosure to consumers, thereby eliminating the need for
each affiliate to send a separate disclosure. Staff anticipates that
affiliated entities will choose to send a joint notice, which will
reduce the number of notices required under the Rule.
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\4\ 15 U.S.C. 6801 et seq.
\5\ ``The public disclosure of information originally supplied
by the Federal government to the recipient for purpose of disclosure
to the public is not included within [the definition of collection
of information].'' 5 CFR 1320.3(c)(2).
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Burden Statement
Under the PRA, 44 U.S.C. 3501-3521, the FTC is requesting that OMB
renew the clearance (OMB Control Number 3084-0131) for the information
collection burden associated with the Rule.\6\ Staff estimates that
there are approximately 54,753 franchise/new car and independent/used
car dealers in the U.S.\7\ Applying an estimated rate of affiliation of
16.75%, staff estimates that there are approximately 9,171 motor
vehicle dealerships in affiliated families that may be subject to the
Rule's affiliate sharing obligations. Staff further estimates an
average of five businesses per family or affiliated relationship, and
anticipates that affiliated entities will choose to send a joint notice
as permitted by the Rule. Therefore, staff estimates that approximately
1,834 business families would be subject to the Rule.
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\6\ While the FTC shares enforcement authority with the Federal
Reserve System, Commodity Futures Trading Commission, National
Credit Union Administration, Office of the Comptroller of the
Currency, and the Federal Deposit Insurance Corporation, for the
Consumer Financial Protection Bureau's counterpart affiliate sharing
rule, Regulation V (Subpart C), 12 CFR 1022.21, the CFPB has assumed
95% of the burden associated with its affiliate sharing rule. See
Consumer Financial Protection Bureau, Agency Information Collection
Activities: Submission for OMB Review; Comment Request, 82 FR 32,686
(2017); CFPB Supporting Statement, Fair Credit Reporting Act
(Regulation V) 12 CFR 1022, OMB Control Number: 3170-0002 (2017). In
addition, the CFPB has estimated that the burden associated with
Regulation V's affiliate sharing provisions is de minimis.
\7\ This figure is based on estimates by the National Automobile
Dealers Association and the National Independent Automobile Dealers
Association. See, e.g., NADA Data 2018: Annual Report; NIADA.com.
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Staff assumes that all or nearly all motor vehicles subject to the
Rule's provisions are also subject to the Commission's Privacy of
Consumer Financial Information Rule under the Gramm-Leach-Bliley Act
(16 CFR 313) (``Privacy Rule''). Entities that are subject to the
Commission's GLBA
[[Page 51164]]
privacy notice regulation already provide privacy notices to their
customers. Absent an exception, financial institutions must provide an
initial privacy notice at the time the customer relationship is
established and then annually so long as the relationship continues. 15
U.S.C. 6803. Staff's estimates assume that in all or nearly all cases
covered institutions will choose to incorporate the affiliate marketing
opt-out notice into the initial and annual GLBA privacy notices. In
2015, Congress, as part of the FAST Act, amended the GLBA to provide an
exception under which financial institutions that meet certain
conditions are not required to provide annual notices to customers.\8\
Staff seeks comment on how the use of this exception by institutions
that are required to provide an affiliate marketing notice will impact
the burden estimates for these entities. Institutions that claim the
FAST Act exemption and forego sending required annual privacy notices
in some years will nonetheless be required to send a separate affiliate
marketing notice to comply with their obligations under the Rule.
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\8\ Fixing America's Surface Transportation Act (``FAST Act''),
Public Law 114-94, 129 Stat. 1312, Section 75001 (Dec. 4, 2015)
(amending 15 U.S.C. 6803 to exempt financial institutions from the
annual notice requirement if they meet certain criteria, and if they
have not changed their policies and practices with regard to
disclosing nonpublic personal information from the policies and
practices that were disclosed in the most recent disclosure sent to
consumers).
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Staff estimates that the 1,834 covered motor vehicle business
families will spend on average about 5 hours per year to comply with
the Affiliate Sharing Rule beyond their separate obligations under the
Privacy Rule, yielding a total annual hours burden of 9,170 hours.
Staff's estimates take into account the time necessary to determine
compliance obligations; create the notice and opt-out, in either paper
or electronic form; and disseminate the notice and opt-out. Staff's
estimates presume that the availability of model disclosures and opt-
out notices will simplify the compliance review and implementation
processes, thereby significantly reducing the compliance burden.
Staff estimates the associated labor cost by adding the hourly mean
private sector wages for managerial, technical, and clerical work and
multiplying that sum by the estimated number of hours. The private
sector hourly wages for these classifications are $50.11, $41.51, and
$17.19, respectively.\9\ Estimated hours spent for each category are 2,
2, and 1, respectively. Multiplying each occupation's hourly wage by
the associated time estimate, yields the annual labor cost burden per
respondent which is then multiplied by the estimated number of
respondents to determine the cumulative annual labor cost burden:
$367,588 per year.
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\9\ The classifications used are ``Management Occupations'' for
managerial employees, ``Computer and Mathematical Science
Occupations'' for technical staff, and ``Office and Administrative
Support'' for clerical workers. See OCCUPATIONAL EMPLOYMENT AND
WAGES --MAY 2018, U.S. Department of Labor, released March 29, 2019,
Table 1 (``National employment and wage data from the Occupational
Employment Statistics survey by occupation, May 2018''): http://www.bls.gov/news.release/ocwage.htm.
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Approx. total
Hourly wage and labor category Hours per Total hourly Number of annual labor
respondent labor cost respondents costs
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$50.11 Management Employees..................... 2 $100.22 1,834 $183,803
41.51 Technical Staff........................... 2 83.02 .............. 152,259
17.19 Clerical Workers.......................... 1 17.19 .............. 31,526
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.............. .............. .............. 367,588
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Because the FACT Act and the Rule contemplate that the affiliate
marketing notice can be included in the GLBA notices, the capital and
non-labor cost burden on regulated entities would be greatly reduced.
Covered entities typically already provide notices to their customers
so there are no new capital or non-labor costs, as the Affiliate
Marketing notice may be consolidated into their annual privacy notice.
Thus, Staff estimates that any capital or non-labor costs associated
with compliance for these entities are de minimis.
Request for Comment
Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites
comments on: (1) Whether the disclosure, recordkeeping, and reporting
requirements are necessary, including whether the resulting information
will be practically useful; (2) the accuracy of our burden estimates,
including whether the methodology and assumptions used are valid; (3)
how to improve the quality, utility, and clarity of the disclosure
requirements; and (4) how to minimize the burden of providing the
required information to consumers. In addition, staff seeks comment on
how the FAST Act exception that exempts certain institutions that are
required to provide an affiliate marketing notice from sending annual
privacy notices will impact the burden estimates for these entities.
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before November 26,
2019. Write ``Affiliate Marketing Disclosure Rule, PRA Comment: FTC
File No. P0105411'' on your comment. 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
through the https://www.regulations.gov website by following the
instructions on the web-based form provided. Your comment, including
your name and your state--will be placed on the public record of this
proceeding, including the https://www.regulations.gov website.
If you file your comment on paper, write ``Affiliate Marketing
Disclosure Rule, PRA Comment: FTC File No. P0105411'' 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 J), 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, Washington, DC 20024. If possible, please submit your paper
comment to the Commission by courier or overnight service.
Because your comment will be placed on the public record, 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
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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 website--as legally required by FTC Rule
4.9(b)--we cannot redact or remove your comment from the FTC website,
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.
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 November 26,
2019. 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.
Heather Hippsley,
Deputy General Counsel.
[FR Doc. 2019-20967 Filed 9-26-19; 8:45 am]
BILLING CODE 6750-01-P