| Comment Number: | 522418-00758 |
| Received: | 6/4/2006 5:44:00 PM |
| Organization: | F & W Arrington Ent. |
| Commenter: | Wanda Arrington |
| State: | TX |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Dear Sir or Madam: I am writing this letter to express my strong opposition to the proposed Business Opportunity Rule R511993. I understand that it is the responsibility of the FTC to protect the public from "unfair and deceptive acts or practices", butthe rule as proposed would make it very difficult for me to operate my business as a Shaklee Independent Distributor. one of the most confusing and burdensome sections of the proposed rule is the seven-day waiting period to enroll new distributors. Most of the people who sign an application do so to purchase Shaklee products at a wholesale price. In other words, they are solely consumers of the products. If they later wish to build a business, 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. The Shaklee Member Kit costs only $19.95. This is far less than many, if not most, consumer purchases, from TVs to all manner of household appliances, none of which require a seven-day waiting period. 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 minimun of 10 prior purchasers nearest to the prospective purchaser. There are many problems with this proposed requirement. In this day of idenity theft, I'm uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or concent, 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 to other buyers. This would keep people from signing up because of identity theft and privacy People are reluctant to share personal information with strangers. The ten references could damage their businesses and lower ranking distributors are often involved in more than one direct selling Company and others might solicit their dist. for their Co. It would also be an administrative burden. I would have to provide Shaklee with the prospective Distributor's address, and wait to receive the list of 10 nearest distributors , last 3 years, get a customized disclosure . It would delay longer than 7 days.Many sign up to earn extra income for holidays or vacation.The long wait can make the goal unobtainable. The proposed rule calls for the release of any information regarding lawsuits that allege misrepresation, or unfair or deceptive practices over a ten year period. It does not matter if the company was found innocent or not liable. Today, almost all business lawsuits contain claims of misrepresentation or unfair competition. It does not make sense to me that I would have to disclose these lawsuits unless Shaklee Corporation, or it's officers, directors or sales department employees, had been found guilty or liable. Otherwise, fifty-year old companies such as Shaklee and their Dist. would be placed at a disadvantage compared to others which may not yet have experienced litigation but which are far more likely to have legal issues surrounding their opportunities. I have been a Shaklee Distributor for 30 years I became one because Iove the Companies Nutrition/personal care/household products and wanted to earn some additional income working from home. Now we depend upon this extra income to supplement our Social Security income. While I appreciate the work of the FTC to protect consumers, I believe this proposed new rule has many unintended consequences for direct sellers and that there are less burdensome alternatives available to the agency to achieve their goals. Thank you for your time in considering my comments. Sincerely, Wanda Arrington