Comment Number: 522418-03415
Received: 6/19/2006 6:52:14 PM
Organization:
Commenter: Deborah Kalina
State: MN
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

I am concerned about the proposed Business Opportunity Rule R511993. I believe that, in its present form, it could hinder me from continuing as a Neways distributor. I understand that part of the FTC's responsibilities is to protect the public from "unfair and deceptive acts or practices," but some of the sections in the proposed rule will make it very difficult, if not impossible, for me to sell Neways products and sign up new distributors. One of the most confusing and burdensome sections of the proposed rule is the seven-day waiting period to enroll new distributors. Neways' sales kit for new distributors costs only $25. People purchase far costlier items without having to wait for seven days. This waiting period gives the impression that something is inherently wrong with Neways' business opportunity. It would stifle my business by requiring considerable extra paperwork and follow-up communication. The proposed rule would require that I tell new enrollees about any lawsuits against my company related to misrepresentation or unfair or deceptive practices, even if the company was found innocent. Today, anyone or any company can be sued for almost anything. Unless Neways is found guilty, it does not make sense that I should have to disclose these lawsuits, which are already a matter of public record. Otherwise, Neways is cast in a questionable light even though the company has done nothing wrong. In reality, this rule would encourage companies to sue each other for competitive reasons. Finally, the proposed rule would require that I give each prospective new enrollee the contact information of the 10 most recent purchasers who live the closest to the prospective new enrollee. Not only would this cause me and my company an undue burden of time and energy to research this information for every new potential customer, but it would violate the privacy and confidentiality of the people provided as references. In addition, it would cause me and my company to lose our competitive advantage by providing customer information to people who could possibly use it for competing business purposes. Finally, the proposed rule would drive away potential new enrollees with the following required sentence: "If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers." The fraudulent business practices of some companies already color the perception of my potential customers and enrollees. Please do not further endanger the success of legitimate business owners because of the behavior of a few others. I appreciate the work of the FTC in protecting my rights as a consumer. However, I believe this proposed new rule would cause many unintended negative consequences for legitimate and honorable businesses, and I urge the FTC to find less burdensome alternatives for achieving its worthy goals. In effect, this rule could function as a ban on our industry. Thank you for considering my comments.