|Received:||7/15/2006 5:09:09 PM|
|Organization:||Quixtar/Flying Eagles (Berland/Courtney)|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:The goal of this proposal is well-intentioned: Those of us involved in real enterprises do not benefit from the free-rein of less-than-ethical and unsubstainable copycats that sully the reputation of an entire industry. That said, the means by which this proposal seeks to achieve this worhty goal is fundamentally flawed in the following ways: 1. It forces those building a business such as ours to become disseminators of negative advertising against themselves. By requiring those advertising their businesses to provide prospects with even mere"allegations"--which may later be proven ill-founded or indeed libelous--against their business, this proposal essentially requires entrepreneurs to seek out a compendium of even spurious claims against the entire business they represent and then pass on this suspect and often disingenuous information as if they were employed by the very parties seeking to discredit and disenfranchise them. For many entrepreneurs in my business in particular, most of the customers one establishes are ex-prospects who turned down the opportunity, but were nonetheless interested in purchasing the goods and services available through the opportunity. For entrepreneurs who secure customers in this way, requiring that they provide them with a compilation of complaints and allegations against our business at large from the first would be the equivalent of requiring Wal-Mart to post a list of pending and settled suits and judgments on its front door, or requiring that their greeter read this list aloud as each customer enters the building. Such a measure would produce no benefit for the consumer, but drain resources and time that the store could better spend serving its customers and organizing its business. 2. It confuses both the opportunities and responsibilities of a home-based entrepreneur with the thoroughly distinct opportunities and responsibilities of an investor. Entrepreneurs recruiting partners into a multi-level business are not (and should not) be seeking parties to invest capital in an enterprise, but rather parties to purchase and build the home-based equivalent of a franchise. While it is essential for those considering the purchase of such a franchise, as it were, to be informed of the current legal and financial status of the company offering the opportunity, the language of the proposal seems mostly to be informed by the perspective of either investment opportunities, or stand alone opportunities in which there is little or no assistance from either the franchising entity or a recruiting partner. Such one-size-fits all language produces burdens upon the entrepreneur without producing any relevant benefit for his prospects. 3. The requirement of references produces a situation in which those who seek to abide by both the spirit and the letter of this proposal will often be put in a state of disadvantage to those who would skirt it. For one thing, as it stands, the proposal seems to lack any mechanism of accountability for the parties used as references, who may choose the point of contact with the prospect to carry out communications that benefit themselves at the expense of the party who initiated the prospect's interest, such as recruiting the prospect into their own business organization instead. The requirement of 10 references is onerous, unfairly limiting the expansion of the business into areas of disperse population or of minimal penetration. Not only this, but it compromises the confidentiality of an entrepreneur's business activity, as the frequency of reference request provides those used as references with an index of prospecting frequency, thus potentially giving unwarranted and unnecessary information of the level of his/her activity and success to parties with no material interest in what is literally "none of their business." Thank you for your consideration.