| Comment Number: | 522418-00201 |
| Received: | 6/1/2006 9:31:40 AM |
| Organization: | Burke Associates |
| Commenter: | Ozzie Burke, PAMA |
| State: | TX |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
June 1, 2006 Ozzie Burke, PAMA Shaklee Business Leader Federal Trade Commission/Office of the Secretary, Room H-135 (Annex W) 600 Pennsylvania Avenue, NW Washington, DC 20580 Re: Business Opportunity Rule, R511993 Dear Sir or Madam: I strongly oppose the proposed Business Opportunity Rule R511993. The Federal Trade Commission is to protect the public from "unfair and deceptive acts or practices," but the proposed rule would make it very difficult for me to operate as a Shaklee Independent Distributor, which I have done for over 30 years. A seven-day waiting period to enroll new distributors, most of who enroll for just $19.95 to purchase products for their use at a discount, would be very harmful to my business! In other words, they are solely consumers of the products. A small percent of distributors may at some point decide to build a business at which time all they must do is supply Shaklee Corporation with their Social Security Number or Tax Identification Number. There is no additional kit, fee or application required. In addition, the seven-day waiting period is unnecessary in that Shaklee Corporation already has a 90% buyback policy for products, including the Member Kit, purchased by a distributor within the last two years. The proposed rule requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. There are many problems with this proposed requirement. In this day of identity theft, I am uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or consent, to strangers. I understand that those who sign up after the rule takes effect would be told in writing "If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers." I believe that this would dissuade new people from signing up as distributors as they are concerned not only about identity theft, but also about their privacy. People today are understandably reluctant to share their personal information with individuals they may never have met. Providing the ten references also could damage the businesses of numerous Shaklee distributors. Lower ranking distributors often are involved in more than one direct selling company. Providing a list to a potential recruit, who may already be a distributor for a competing direct selling company, may be an invitation to solicit existing distributors for such other opportunity. The ten reference requirement also is an administrative burden. In order to obtain the list of 10 prior purchasers, I will need to provide Shaklee Corporation with the prospective distributor's address, and then wait to receive the list of the 10 nearest distributors who became distributors within the past three years. Each prospective recruit will need a customized disclosure statement. This will result in a delay far longer than seven calendar days before any potential recruit can sign an application to just make discount purchases. Also, in view of the fact that some people enter direct selling part-time to earn extra income for a specific goal, such as holiday purchases or a family vacation, the long wait which the proposed rule will entail may make the goal unattainable. The proposal to release info on lawsuites in which the company is innocent is absurd and a defamation of business character. Fifty-year old companies such as Shaklee Corporation and their distributors would be placed at a disadvantage compared to start-up direct selling companies, which may not yet have experienced litigation. America needs the work of the FTC to protect consumers, but this proposed new rule has many unintended consequences for direct sellers. There are far less burdensome alternatives available to the agency to achieve its goals. Thanks for reading my opinion. Sincerely, Ozzie Burke, PAMA