[Federal Register: May 28, 1997 (Volume 62, Number 102)] [Proposed Rules] [Page 28822-28824] From the Federal Register Online via GPO Access [wais.access.gpo.gov] [DOCID:fr28my97-16] ======================================================================= ----------------------------------------------------------------------- FEDERAL TRADE COMMISSION 16 CFR Part 436 Franchise Rule Public Workshop Conferences AGENCY: Federal Trade Commission. ACTION: Public workshop conferences. ----------------------------------------------------------------------- SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') will hold six public workshop conferences in connection with the Advance Notice of Proposed Rulemaking (``ANPR'') on the Trade Regulation Rule entitled ``Disclosure Requirements and Prohibitions Concerning Franchising and Business Opportunity Ventures,'' 16 CFR Part 436 (the ``Franchise Rule'' and ``Rule''). In addition, the Commission will continue to accept comments on the ANPR until December 31, 1997. DATES: The public workshop conferences will be held as follows: ---------------------------------------------------------------------------------------------------------------- Conf. No. Topics Location Dates ---------------------------------------------------------------------------------------------------------------- 1..................... Trade Show Promoters...... Washington, DC.................. July 28, 29. 2..................... Business Opportunities.... Chicago, IL..................... Aug. 21, 22. 3..................... UFOC, Internet, New York, NY.................... Sept. 18, 19. International Co- Branding, Alternative Law Enforcement. 4..................... Business Opportunities.... Dallas, TX...................... Oct. 20, 21. 5..................... UFOC, Internet, Seattle, WA..................... Nov. 6, 7. International, Co- Branding, Alternative Law Enforcement. 6..................... Business Opportunities.... Washington, DC.................. Nov. 20, 21. ---------------------------------------------------------------------------------------------------------------- [[Page 28823]] The first day of each conference will run from 9 a.m. until 5 p.m., and the second day will run from 9 a.m. until 3 p.m. The first day of each conference will consist of a roundtable discussion on the various issues described below. Members of the public will also have the opportunity to comment on the issues raised during the roundtable discussions. The second day will be reserved for members of the general public who wish to make statements for the record on any of the topics raised by the ANPR. ADDRESSES: Parties interested in participating in one or more of the Public Workshop Conferences should submit a request to participate on or before July 1, 1997, to Myra Howard, Division of Marketing Practices, Federal Trade Commission, Washington, DC 20580. The Commission will also accept requests to participate received at the following E-mail address: ``FRANPR@ftc.gov'', and at the Commission's ANPR hotline telephone number: (202) 326-3573. FOR FURTHER INFORMATION CONTACT: Steven Toporoff, (202) 326-3135, or Myra Howard, (202) 326-2047, Division of Marketing Practices, Bureau of Consumer Protection, Federal Trade Commission, 6th Street and Pennsylvania Avenue, NW., Washington, DC. 20580. SUPPLEMENTARY INFORMATION: Part A--Overview of the Commission's ANPR On February 28, 1997, the Commission published an ANPR announcing the Commission's proposal to commence a rulemaking proceeding to amend the Franchise Rule. 62 FR 9115 (February 28, 1997). The ANPR requested comment on whether the Franchise Rule should be amended to: (1) Revise the Rule's disclosure requirements based upon the Uniform Franchise Offering Circular Guidelines (``UFOC'') model; (2) distinguish between disclosures for business opportunities and for franchises; (3) exempt trade show promoters from liability as ``brokers; '' (4) require trade show exhibitors to have their disclosure documents available for public inspection; (5) require franchisors to inform prospective franchisees that franchisors are permitted to disclose earnings information, and where franchisors elect not to do so, to require such franchisors to state that they make no earnings representations and do not authorize their salespersons to make them; (6) clarify that the Rules does not apply to the sale of franchises to be located outside the United States; (7) clarify the applicability of the Rule to the sale of franchises over the Internet; and (8) clarify the applicability of the Rule to the sale of co-branded franchise systems. In addition, the ANPR asked whether the Commission should develop a program to reduce or waive civil penalties for certain violations of the Franchise Rule. Part B--Extension of Comment Period The ANPR stated that comments must be submitted on or before April 30, 1997. The Commission is now extending the comment period until after the final public workshop conference is held, as set forth below, in order to provide the public with maximum opportunity to participate in the rulemaking process. Therefore, submissions of views, drafts of proposed amendments to the Rule, and any other written, oral, or visual materials will be accepted throughout the conference period, and up until December 31, 1997. All such comments will also be made part of the public record. Part C--Overview of the Public Workshop Conferences The ANPR announced that Commission staff would hold several public workshop conferences. These conferences are intended to serve several purposes: (1) To allow Commission staff and interested parties the opportunity to discuss openly issues raised in the ANPR and in the comments to the ANPR; (2) to offer the general public an opportunity to make statements on the record concerning the issues raised in the ANPR; and (3) to assist Commission staff in drafting a proposed amended rule. Accordingly, the first day of each public workshop conference will consist of a roundtable discussion centered on a specific topic or topics, as noted below. In addition to discussing and analyzing the issues, the participants will be asked to offer concrete suggestions on revising the Rule in those specific areas. Participation by the general public the first day will be limited to a discussion of the topics raised that day. The second day of each conference will be reserved for the general public to share their comments and concerns about any of the issues raised in the ANPR. Statements by members of the general public may be limited to a few minutes, depending on the number of persons who wish to make statements. All discussions and comments will be transcribed and placed on the public record. The Commission staff will select a limited number of parties to join in the roundtable discussions. To the extent possible, Commission staff will select parties to represent the following affected interests: franchisors; franchisees; business opportunity promoters; business opportunity purchasers; franchise and business opportunity trade show organizers; franchise and business opportunity brokers; franchisor, franchise, business opportunity, and other trade or industry associations; franchise consultants; economists and academicians; Federal, State and local law enforcement and regulatory authorities; and any other interests that Commission staff may identify and deem appropriate for representation. Parties representing the above-referenced interests will be selected on the basis of the following criteria: 1. The party must submit a comment. First priority will be given to those parties who submit their comment by July 1, 1997. After that date, parties may be considered as participants on a space-available basis. 2. The party must also notify Commission staff in writing, via E- mail, or via the hotline number, of its interest in being a roundtable participant and, if required, authorization to represent an affected interest, on or before July 1, 1997. The party must also identify which conference or conferences that party wishes to attend. Those parties submitting their requests after July 1, 1997, will also be considered on a space-available basis. 3. The party's participation would promote a balance of interests represented at the conference. 4. The party's participation would promote the consideration and discussion of the topics being discussed at the conference. 5. The party has experience or expertise in activities affected by the Franchise Rule. 6. The party adequately reflects the views of the affected interest(s). 7. The number of parties selected will not be so large as to inhibit effective discussion among them. The Commission strongly encourages all interested parties to participate in the public workshop conferences, as the transcripts from the conferences will be an important part of the public record in this rulemaking proceeding. Individuals wishing to make statements on the record the second day of any conference need not submit a request to participate, and the Commission will make every effort to provide time for all members of the general public to make statements regarding any of the ANPR issues. Each conference will be facilitated by a Commission staff member. Prior to each conference, [[Page 28824]] participants will be provided with tentative agendas as well as copies of the comments submitted in response to the ANPR. Part D--Schedule of Public Workshop Conferences The first public workshop will be held on July 28 and 29, 1997, at the Federal Trade Commission, Room 432, 6th Street and Pennsylvania Avenue, NW., Washington, DC 20580. The roundtable discussion on July 28, 1997, will focus on the possible exemption of trade show promoters from the Rule's disclosure requirements and the development of possible voluntary industry standards. The second public workshop conference will be held on August 21 and 22, 1997, at the Chicago Regional Office, Federal Trade Commission, 55 E. Monroe Street, Suite 1860, Chicago, Illinois 60603. The roundtable discussion on August 21, 1997, will focus on revisions to the business opportunity section of the Rule, including a definition of the term ``business opportunity.'' The third public workshop conference will be held on September 18 and 19, 1997, at the Jacob Javits Federal Building, 26 Federal Plaza, Floor 36, Conference Room 3604, New York, NY 10278. The roundtable discussion on September 18, 1997, will focus on whether the Commission should revise the Rule based upon the UFOC model and possible modifications; the sale of franchises through the Internet; the sale of co-branded franchise systems; and alternative approaches to Franchise Rule law enforcement. The fourth public workshop conference will be held on October 20 and 21, 1997, at the Dallas Regional Office, Federal Trade Commission, 1999 Bryan Street, Suite 2150, Dallas, Texas 75201. The roundtable discussion on October 20, 1997, will focus on proposals for a revised definition of the term ``business opportunity,'' and specific proposed disclosure requirements for business opportunity sellers. The fifth public workshop conference will be held on November 6 and 7, 1997, at the Seattle Regional Office, Federal Trade Commission, 915 Second Avenue, Suite 2886, Seattle, Washington 98174. The roundtable discussion on November 6, 1997, will focus on whether the Commission should revise the Rule based upon the UFOC model and possible modifications; the sale of franchises through the Internet; the sale of co-branded franchise systems; and alternative approaches to Franchise Rule law enforcement. The final public workshop conference will be held on November 20 and 21, 1997, at the Federal Trade Commission, Room 432, 6th Street and Pennsylvania Avenue, NW., Washington, DC 20580. The roundtable discussion on November 20, 1997, will focus on drafting revised business opportunity disclosures. List of Subjects in 16 CFR Part 436 Advertising, Business and industry, Franchising, Trade practices. Authority: 15 U.S.C. 41-58. By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 97-13870 Filed 5-27-97; 8:45 am] BILLING CODE 6750-01-M