|Received:||7/17/2006 11:58:04 PM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:RE: Business Opportunity Rule R511993. I am writing to express my strong opposition to the proposed Business Opportunity Rule R511993. I believe this proposed new rule has many unintended consequences and actually CREATES undue burden on legimate businesses in the Direct Selling and Network Marketing industries. One of the most burdensome sections of the proposed rule is that it would impose a de facto 7-day waiting period on the enrollment of new distributors. I can think of nothing more counter-productive to the lifeblood of business than imposing a rule that would slow down the rate of business growth to a crawl. Distributor “A” would have to wait seven days to enroll Distributor “B”, and would then be hamstrung in helping Distributor “B” get his/her business started by waiting another seven days to enroll “B’s” candidate, “C”… ad infinitem. Another concern is the section requiring disclosure of ten (10) prior purchasers in the geographic area nearest the prospective purchaser. First, it would be very problematic to disclose the identity or personal information of another individual, without their knowledge or consent, to a person or persons unknown to them. Secondly, the requirement that prospective purchasers be informed that their contact information may be disclosed in the future to other buyers would definitely have a negative impact on business, as so many people have legimate concerns about issues such as identity theft and unwanted marketing (“Spam” and “Do Not Call” lists), etc. Another patently unfair section of the proposed rule is the requirement of disclosure for any information regarding lawsuits over a ten-year period, involving allegations of misrepresentation, unfair, or deceptive practices, regardless of whether the company has been found not liable or innocent. Businesses often must expend considerable time, effort and expense to defend themselves against such allegations; in this scenario, they would still be haunted by “guilt by association” because of the simple fact that they had been involved in litigation, even after they had been found innocent of any wrongdoing. Many fine, upstanding companies in the Direct Sales and Network Marketing industries who have prevailed in court would be placed at a disadvantage compared to new start-up companies, which may not yet have experienced litigation, yet are far more likely to have problematic legal issues. There are adequate legal safeguards already in existence that allow individuals to make informed choices regarding potential involvement in Business Opportunities. The proposed Business Opportunity Rule R511993 adds more government where it is not really necessary. As that late great American, Ronald Reagan, so aptly stated: “What this country needs is LESS government, not more government.” I appreciate the opportunity to present these comments, and thank you for your consideration.