[Federal Register Volume 85, Number 10 (Wednesday, January 15, 2020)]
[Notices]
[Pages 2424-2425]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00487]



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FEDERAL TRADE COMMISSION


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

AGENCY: Federal Trade Commission (FTC).

ACTION: Notice and request for comment.

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SUMMARY: The FTC requests that the Office of Management and Budget 
(OMB) extend for three years the current PRA clearance for information 
collection requirements contained in the FTC's Consumer Product 
Warranty Rule (Warranty Rule or Rule). The current clearance expires on 
January 31, 2020.

DATES: Comments must be received by February 14, 2020.

ADDRESSES: Comments in response to this notice should be submitted to 
the OMB Desk Officer for the Federal Trade Commission within 30 days of 
this notice. You may submit comments using any of the following 
methods:
    Electronic: Write ``Consumer Product Warranty Rule: PRA Comment, 
P072108,'' on your comment and file your comment online at https://www.regulations.gov, by following the instructions on the web-based 
form.
    Email: [email protected].
    Fax: (202) 395-5806.
    Mail: 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.

FOR FURTHER INFORMATION CONTACT: Christine M. Todaro, Attorney, 
Division of Marketing Practices, Bureau of Consumer Protection, Federal 
Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580, 
(202) 326-3711.

SUPPLEMENTARY INFORMATION:
    Title: Rule Concerning Disclosure of Written Consumer Product 
Warranty Terms and Conditions (Warranty Rule or Rule).
    OMB Control Number: 3084-0111.
    Type of Review: Extension of a currently approved collection.
    Abstract: The Warranty Rule is one of three rules \1\ that the FTC 
implemented pursuant to requirements of the Magnuson-Moss Warranty Act, 
15 U.S.C. 2301 et seq. (Warranty Act or Act).\2\ The Warranty Rule 
specifies the information that must appear in a written warranty on a 
consumer product \3\ costing more than $15. The Rule tracks Section 
102(a) of the Warranty Act,\4\ specifying information that must appear 
in the written warranty and, for certain disclosures, mandates the 
exact language that must be used.\5\ Neither the Warranty Rule nor the 
Act requires that a manufacturer or retailer warrant a consumer product 
in writing, but if they choose to do so, the warranty must comply with 
the Rule.
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    \1\ The other two rules relate to the pre-sale availability of 
warranty terms and minimum standards for informal dispute settlement 
mechanisms that are incorporated into a written warranty.
    \2\ 40 FR 60168 (Dec. 31, 1975).
    \3\ The definition of consumer product excludes products 
purchased solely for commercial or industrial use. 16 CFR 701.1(b).
    \4\ 15 U.S.C. 2302(a).
    \5\ 40 FR 60168, 60169-60170.
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    On October 4, 2019, the Commission sought comment on the disclosure 
requirements associated with the Warranty Rule. 84 FR 53149. No 
relevant comments were received. Pursuant to the OMB regulations, 5 CFR 
part 1320, that implement the PRA, 44 U.S.C. 3501 et seq., the FTC is 
providing this second opportunity for public comment while seeking OMB 
approval to renew the pre-existing clearance for those information 
collection requirements.
    The following discussion presents the FTC's PRA burden analysis 
regarding the Warranty Rule. Please be advised that the Commission has 
updated the estimates that were previously presented in the 60-Day 
Notice.

Warranty Rule Burden Statement

    Total annual hours burden: 242,296 hours.
    In its 2016 submission to OMB, the FTC estimated that the 
information collection burden of including the disclosures required by 
the Warranty Rule was 140,280 hours per year. Although the Rule's 
information collection requirements have not changed, the current 
estimate increases the number of manufacturers subject to the Rule 
based on recent Census data.\6\ Further, because most warrantors likely 
would continue to disclose the information required by the Rule, even 
if there were no statute or rule requiring them to do so, staff's 
estimates likely overstate the PRA-related burden attributable to the 
Rule. Moreover, the Warranty Rule has been in effect since 1976, and 
warrantors have long since modified their warranties to include the 
information the Rule requires.
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    \6\ Number of Firms, Number of Establishments, Employment, and 
Annual Payroll by Enterprise Employment Size for the United States, 
All Industries: 2016 release date: 12/18/2018, available at http://www.census.gov/programs-surveys/susb/technical-documentation/methodology.html.
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    Based on conversations with various warrantors' representatives 
over the years, staff has concluded that eight hours per year is a 
reasonable estimate of warrantors' PRA-related burden attributable to 
the Warranty Rule.\7\ This estimate includes the number of hours 
warrantors may need to ensure new warranties and any changes to 
existing warranties comply with the Rule. Based on recent Census data, 
staff now estimates that there are 30,287 manufacturers covered by the 
Rule.\8\ This results in an annual burden estimate of approximately 
242,296 hours (30,287 manufacturers x 8 hours of burden per year).
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    \7\ FTC staff has previously contacted two manufacturing 
associations--the Association of Home Appliance Manufacturers and 
the National Association of Manufacturers--and we have not located 
additional data that further clarifies this figure.
    \8\ Because some manufacturers likely make products that are not 
priced above $15 or not intended for household use--and thus would 
not be subject to the Rule--this figure is likely an overstatement.
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    Total annual labor costs: $32,981,332.
    Labor costs are derived by applying appropriate hourly cost figures 
to the burden hours described above. The work required to comply with 
the Warranty Rule--ensuring that new warranties and changes to existing 
warranties comply with the Rule--requires a mix of legal analysis 
(50%), legal support (paralegals) (25%) and clerical help (25%). Staff 
estimates that half of the total burden hours (121,148 hours) requires 
legal analysis at an average hourly wage of $250 for legal 
professionals,\9\ resulting in a labor cost of $30,287,000. Assuming 
that 25% of the total burden hours requires legal support at the 
average hourly wage of $26.20, and that the remaining 25% requires 
clerical work at an average hourly wage of $18.28; the resulting labor 
cost is approximately $2,694,332 ($1,587,039 + 1,107,293). Thus, the 
total annual labor cost is approximately $32,981,332 ($30,287,000 for 
legal professionals + $1,587,039 for legal support + $1,107,293 for 
clerical workers).
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    \9\ Staff has derived an hourly wage rate for legal 
professionals based upon industry knowledge. The hourly wage rates 
for legal support workers and for clerical support are based on mean 
hourly wages found at https://www.bls.gov/news.release/ocwage.htm 
(``Occupational Employment and Wages-May 2018,'' U.S. Department of 
Labor, released March 2019, Table 1 (``National employment and wage 
data from the Occupational Employment Statistics survey by 
occupation, May 2018'').
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    Total annual capital or other non-labor costs: $0

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    The Rule imposes no appreciable current capital or start-up costs. 
As stated above, warrantors likely have already modified their 
warranties to include the information the Rule requires. Rule 
compliance does not require the use of any capital goods, other than 
ordinary office equipment, which providers would already have available 
for general business use.

Request for Comment

    Your comment--including your name and your state--will be placed on 
the public record of this proceeding at the https://www.regulations.gov 
website. 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 anyone'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.

Heather Hippsley,
Deputy General Counsel.
[FR Doc. 2020-00487 Filed 1-14-20; 8:45 am]
 BILLING CODE 6750-01-P