[Federal Register Volume 85, Number 9 (Tuesday, January 14, 2020)]
[Rules and Regulations]
[Pages 2014-2016]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00314]


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FEDERAL TRADE COMMISSION

16 CFR Part 1


Adjustments to Civil Penalty Amounts

AGENCY: Federal Trade Commission.

ACTION: Final rule.

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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is 
implementing adjustments to the civil penalty amounts within its 
jurisdiction to account for inflation, as required by law.

DATES: Effective January 14, 2020.

FOR FURTHER INFORMATION CONTACT: Kenny A. Wright, Attorney, Office of 
the General Counsel, FTC, 600 Pennsylvania Avenue NW, Washington, DC 
20580, (202-326-2907), [email protected].

SUPPLEMENTARY INFORMATION: The Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015 \1\ directs agencies to adjust 
the civil penalty maximums under their jurisdiction for inflation every 
January. Accordingly, the Commission issues annual adjustments to the 
maximum civil penalty amounts under its jurisdiction.\2\
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    \1\ Public Law 114-74, sec. 701, 129 Stat. 599 (2015). The Act 
amends the Federal Civil Penalties Inflation Adjustment Act 
(``FCPIAA''), Public Law 101-410, 104 Stat. 890 (codified at 28 
U.S.C. 2461 note).
    \2\ 81 FR 42476 (June 30, 2016); 82 FR 8135 (2017); 83 FR 2902 
(2018); 84 FR 3980 (2019).
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    Commission Rule Sec.  1.98 sets forth the applicable civil penalty 
amounts for violations of certain laws enforced by the Commission.\3\ 
As directed by the FCPIAA, the Commission is issuing adjustments to 
increase these maximum civil penalty amounts to address inflation since 
its prior 2019 adjustment. The following adjusted amounts will take 
effect on January 14, 2020:
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    \3\ 16 CFR 1.98.
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     Section 7A(g)(1) of the Clayton Act, 15 U.S.C. 18a(g)(1) 
(premerger filing notification violations under the Hart-Scott-Rodino 
Improvements Act)--Increase from $42,530 to $43,280;
     Section 11(l) of the Clayton Act, 15 U.S.C. 21(l) 
(violations of cease and desist orders issued under Clayton Act section 
11(b))--Increase from $22,595 to $22,994;
     Section 5(l) of the FTC Act, 15 U.S.C. 45(l) (unfair or 
deceptive acts or practices)--Increase from $42,530 to $43,280;
     Section 5(m)(1)(A) of the FTC Act, 15 U.S.C. 45(m)(1)(A) 
(unfair or deceptive acts or practices)--Increase from $42,530 to 
$43,280;
     Section 5(m)(1)(B) of the FTC Act, 15 U.S.C. 45(m)(1)(B) 
(unfair or deceptive acts or practices)--Increase from $42,530 to 
$43,280;
     Section 10 of the FTC Act, 15 U.S.C. 50 (failure to file 
required reports)--Increase from $559 to $569;
     Section 5 of the Webb-Pomerene (Export Trade) Act, 15 
U.S.C. 65 (failure by associations engaged solely in export

[[Page 2015]]

trade to file required statements)--Increase from $559 to $569;
     Section 6(b) of the Wool Products Labeling Act, 15 U.S.C. 
68d(b) (failure by wool manufacturers to maintain required records)--
Increase from $559 to $569;
     Section 3(e) of the Fur Products Labeling Act, 15 U.S.C. 
69a(e) (failure to maintain required records regarding fur products)--
Increase from $559 to $569;
     Section 8(d)(2) of the Fur Products Labeling Act, 15 
U.S.C. 69f(d)(2) (failure to maintain required records regarding fur 
products)--Increase from $559 to $569;
     Section 333(a) of the Energy Policy and Conservation Act, 
42 U.S.C. 6303(a) (knowing violations of EPCA sec. 332, including 
labeling violations)--Increase from $460 to $468;
     Section 525(a) of the Energy Policy and Conservation Act, 
42 U.S.C. 6395(a) (recycled oil labeling violations)--Increase from 
$22,595 to $22,994;
     Section 525(b) of the Energy Policy and Conservation Act, 
42 U.S.C. 6395(b) (willful violations of recycled oil labeling 
requirements)--Increase from $42,530 to $43,280;
     Section 621(a)(2) of the Fair Credit Reporting Act, 15 
U.S.C. 1681s(a)(2) (knowing violations of the Fair Credit Reporting 
Act)--Increase from $3,993 to $4,063;
     Section 1115(a) of the Medicare Prescription Drug 
Improvement and Modernization Act of 2003, Pub. L. 108-173, as amended 
by Pub. L. 115-263, 21 U.S.C. 355 note (failure to comply with filing 
requirements)--Increase from $15,036 to $15,301; and
     Section 814(a) of the Energy Independence and Security Act 
of 2007, 42 U.S.C. 17304 (violations of prohibitions on market 
manipulation and provision of false information to federal agencies)--
Increase from $1,210,340 to $1,231,690.

Calculation of Inflation Adjustments

    The FCPIAA, as amended, directs federal agencies to adjust each 
civil monetary penalty under their jurisdiction for inflation in 
January of each year pursuant to a cost-of-living adjustment.\4\ The 
cost-of-living adjustment is based on the percent change between the 
U.S. Department of Labor's Consumer Price Index for all-urban consumers 
(``CPI-U'') for the month of October preceding the date of the 
adjustment, and the CPI-U for October of the prior year.\5\ Based on 
that formula, the cost-of-living adjustment multiplier for 2020 is 
1.01764. The FCPIAA also directs that these penalty level adjustments 
should be rounded to the nearest dollar. Agencies do not have 
discretion over whether to adjust a maximum civil penalty, or the 
method used to determine the adjustment.
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    \4\ 28 U.S.C. 2461 note (4).
    \5\ Id. (3), (5)(b); Office of Management and Budget, Memorandum 
M-20-05, Implementation of Penalty Inflation Adjustments for 2020, 
Pursuant to the Federal Civil Penalties Inflation Adjustment Act 
Improvements Act of 2015 (December 16, 2019), available at: https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
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    The following chart illustrates the application of these 
adjustments to the civil monetary penalties under the Commission's 
jurisdiction.

                         Calculation of Adjustments to Maximum Civil Monetary Penalties
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                                                                                                   2020 penalty
                                                                   2019 penalty     Adjustment    level (rounded
               Citation                        Description             level        multiplier    to the nearest
                                                                                                      dollar)
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16 CFR 1.98(a): 15 U.S.C. 18a(g)(1)...  Premerger filing                 $42,530         1.01764         $43,280
                                         notification violations.
16 CFR 1.98(b): 15 U.S.C. 21(l).......  Violations of cease and           22,595         1.01764          22,994
                                         desist orders.
16 CFR 1.98(c): 15 U.S.C. 45(l).......  Unfair or deceptive acts          42,530         1.01764          43,280
                                         or practices.
16 CFR 1.98(d): 15 U.S.C. 45(m)(1)(A).  Unfair or deceptive acts          42,530         1.01764          43,280
                                         or practices.
16 CFR 1.98(e): 15 U.S.C. 45(m)(1)(B).  Unfair or deceptive acts          42,530         1.01764          43,280
                                         or practices.
16 CFR 1.98(f): 15 U.S.C. 50..........  Failure to file required             559         1.01764             569
                                         reports.
16 CFR 1.98(g): 15 U.S.C. 65..........  Failure to file required             559         1.01764             569
                                         statements.
16 CFR 1.98(h): 15 U.S.C. 68d(b)......  Failure to maintain                  559         1.01764             569
                                         required records.
16 CFR 1.98(i): 15 U.S.C. 69a(e)......  Failure to maintain                  559         1.01764             569
                                         required records.
16 CFR 1.98(j): 15 U.S.C. 69f(d)(2)...  Failure to maintain                  559         1.01764             569
                                         required records.
16 CFR 1.98(k): 42 U.S.C. 6303(a).....  Knowing violations......             460         1.01764             468
16 CFR 1.98(l): 42 U.S.C. 6395(a).....  Recycled oil labeling             22,595         1.01764          22,994
                                         violations.
16 CFR 1.98(l): 42 U.S.C. 6395(b).....  Willful violations......          42,530         1.01764          43,280
16 CFR 1.98(m): 15 U.S.C. 1681s(a)(2).  Knowing violations......           3,993         1.01764           4,063
16 CFR 1.98(n): 21 U.S.C. 355 note....  Non-compliance with               15,036         1.01764          15,301
                                         filing requirements.
16 CFR 1.98(o): 42 U.S.C. 17304.......  Market manipulation or         1,210,340         1.01764       1,231,690
                                         provision of false
                                         information to federal
                                         agencies.
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Effective Dates of New Penalties

    These new penalty levels apply to civil penalties assessed after 
the effective date of the applicable adjustment, including civil 
penalties whose associated violation predated the effective date.\6\ 
These adjustments do not retrospectively change previously assessed or 
enforced civil penalties that the FTC is actively collecting or has 
collected.
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    \6\ 28 U.S.C. 2461 note (6).
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Procedural Requirements

    The FCPIAA, as amended, directs agencies to adjust civil monetary 
penalties through rulemaking and to publish the required inflation 
adjustments in the Federal Register, notwithstanding section 553 of 
title 5, United States Code. Pursuant to this congressional mandate, 
prior public notice and comment under the APA and a delayed effective 
date are not required. For this reason, the requirements of the 
Regulatory Flexibility Act (``RFA'') also do not apply.\7\ Further, 
this rule does not contain any collection of information requirements 
as defined by the Paperwork Reduction Act of 1995 as amended. 44 U.S.C. 
3501 et seq.
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    \7\ A regulatory flexibility analysis under the RFA is required 
only when an agency must publish a notice of proposed rulemaking for 
comment. See 5 U.S.C. 603.
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    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs

[[Page 2016]]

designated this rule as not a ``major rule,'' as defined by 5 U.S.C. 
804(2).

List of Subjects for 16 CFR Part 1

    Administrative practice and procedure, Penalties, Trade practices.

Text of Amendments

    For the reasons set forth in the preamble, the Federal Trade 
Commission amends title 16, chapter I, subchapter A, of the Code of 
Federal Regulations, as follows:

PART 1--GENERAL PROCEDURES

Subpart L--Civil Penalty Adjustments Under the Federal Civil 
Penalties Inflation Adjustment Act of 1990, as Amended

0
1. The authority citation for part 1, subpart L, continues to read as 
follows:

    Authority: 28 U.S.C. 2461 note.


0
2. Revise Sec.  1.98 to read as follows:


Sec.  1.98  Adjustment of civil monetary penalty amounts.

    This section makes inflation adjustments in the dollar amounts of 
civil monetary penalties provided by law within the Commission's 
jurisdiction. The following maximum civil penalty amounts apply only to 
penalties assessed after January 14, 2020, including those penalties 
whose associated violation predated January 14, 2020.
    (a) Section 7A(g)(1) of the Clayton Act, 15 U.S.C. 18a(g)(1)-
$43,280;
    (b) Section 11(l) of the Clayton Act, 15 U.S.C. 21(l)-$22,994;
    (c) Section 5(l) of the FTC Act, 15 U.S.C. 45(l)-$43,280;
    (d) Section 5(m)(1)(A) of the FTC Act, 15 U.S.C. 45(m)(1)(A)-
$43,280;
    (e) Section 5(m)(1)(B) of the FTC Act, 15 U.S.C. 45(m)(1)(B)-
$43,280;
    (f) Section 10 of the FTC Act, 15 U.S.C. 50-$569;
    (g) Section 5 of the Webb-Pomerene (Export Trade) Act, 15 U.S.C. 
65-$569;
    (h) Section 6(b) of the Wool Products Labeling Act, 15 U.SC. 
68d(b)-$569;
    (i) Section 3(e) of the Fur Products Labeling Act, 15 U.S.C. 
69a(e)-$569;
    (j) Section 8(d)(2) of the Fur Products Labeling Act, 15 U.S.C. 
69f(d)(2)-$569;
    (k) Section 333(a) of the Energy Policy and Conservation Act, 42 
U.S.C. 6303(a)-$468;
    (l) Sections 525(a) and (b) of the Energy Policy and Conservation 
Act, 42 U.S.C. 6395(a) and (b), respectively-$22,994 and $43,280, 
respectively;
    (m) Section 621(a)(2) of the Fair Credit Reporting Act, 15 U.S.C. 
1681s(a)(2)-$4,063;
    (n) Section 1115(a) of the Medicare Prescription Drug Improvement 
and Modernization Act of 2003, Public Law 108-173, as amended by Public 
Law 115-263, 21 U.S.C. 355 note-$15,301;
    (o) Section 814(a) of the Energy Independence and Security Act of 
2007, 42 U.S.C. 17304-$1,231,690; and
    (p) Civil monetary penalties authorized by reference to the Federal 
Trade Commission Act under any other provision of law within the 
jurisdiction of the Commission--refer to the amounts set forth in 
paragraphs (c), (d), (e), and (f) of this section, as applicable.

    By direction of the Commission.
April J. Tabor,
Acting Secretary.
[FR Doc. 2020-00314 Filed 1-13-20; 8:45 am]
 BILLING CODE 6750-01-P