Agency Information Collection Activities; Proposed Collection; Comment Request, 26103-26105 [2017-11600]
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Federal Register / Vol. 82, No. 107 / Tuesday, June 6, 2017 / Notices
By Order of the Federal Maritime
Commission.
Dated: June 1, 2017.
Rachel E. Dickon,
Assistant Secretary.
[FR Doc. 2017–11658 Filed 6–5–17; 8:45 am]
BILLING CODE 6731–AA–P
FEDERAL TRADE COMMISSION
Agency Information Collection
Activities; Proposed Collection;
Comment Request
Federal Trade Commission
(‘‘FTC’’ or ‘‘Commission’’).
ACTION: Notice.
AGENCY:
The FTC intends to ask the
Office of Management and Budget
(‘‘OMB’’) to extend for an additional
three years the current Paperwork
Reduction Act (‘‘PRA’’) clearance for
information collection requirements
contained in its Trade Regulation Rule
on Disclosure Requirements and
Prohibitions Concerning Franchising
(‘‘Franchise Rule’’ or ‘‘Rule’’). That
clearance expires on November 30,
2017.
DATES: Comments must be submitted by
August 7, 2017.
ADDRESSES: Interested parties may file a
comment online or on paper, by
following the instructions in the
Request for Comment part of the
SUPPLEMENTARY INFORMATION section
below. Write ‘‘Franchise Rule, PRA
Comment, FTC File No. P094400’’ on
your comment, and file your comment
online at https://
ftcpublic.commentworks.com/ftc/
franchiserulePRA by following the
instructions on the web-based form. If
you prefer to file your comment on
paper, mail your comment to the
following address: Federal Trade
Commission, Office of the Secretary,
600 Pennsylvania Avenue NW., Suite
CC–5610 (Annex J), Washington, DC
20580, or deliver your comment to the
following address: Federal Trade
Commission, Office of the Secretary,
Constitution Center, 400 7th Street SW.,
5th Floor, Suite 5610 (Annex J),
Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT:
Requests for additional information
should be addressed to Craig Tregillus,
Attorney, Division of Marketing
Practices, Bureau of Consumer
Protection, Federal Trade Commission,
600 Pennsylvania Avenue NW., Room
8607, Washington, DC 20580, (202) 326–
2970.
SUPPLEMENTARY INFORMATION: Under the
PRA, 44 U.S.C. 3501–3521, federal
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SUMMARY:
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agencies must obtain approval from
OMB for each collection of information
they conduct or sponsor. ‘‘Collection of
information’’ means agency requests or
requirements that members of the public
submit reports, keep records, or provide
information to a third party. 44 U.S.C.
3502(3); 5 CFR 1320.3(c). As required by
section 3506(c)(2)(A) of the PRA, the
FTC is providing this opportunity for
public comment before requesting that
OMB extend the existing clearance for
the information collection requirements
contained in the Franchise Rule, 16 CFR
part 436 (OMB Control No. 3084–0107).
The FTC invites comments on: (1)
Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
agency, including whether the
information will have practical utility;
(2) the accuracy of the agency’s estimate
of the burden of the proposed collection
of information, including the validity of
the methodology and assumptions used;
(3) ways to enhance the quality, utility,
and clarity of the information to be
collected; and (4) ways to minimize the
burden of the collection of information
on those who are to respond, including
through the use of appropriate
automated, electronic, mechanical, or
other technological collection
techniques or other forms of information
technology, e.g., permitting electronic
submission of responses.
The Franchise Rule ensures that
consumers who are considering a
franchise investment have access to the
material information they need to make
an informed investment decision
provided in a format that facilitates
comparisons of different franchise
offerings. The Rule requires that
franchisors disclose this information to
consumers and maintain records to
facilitate enforcement of the Rule.
Amendments to the Rule promulgated
on March 30, 2007, which took effect
after a one-year phase-in on July 1,
2008, merged the Rule’s disclosure
requirements with the disclosure format
accepted by 15 states that have franchise
registration or disclosure laws.1 The
amended Rule has significantly
minimized any compliance burden
beyond what is already required by state
law.
The amended Rule requires
franchisors to furnish prospective
purchasers with a Franchise Disclosure
Document (‘‘FDD’’) that provides
information relating to the franchisor,
its business, the nature of the proposed
franchise, and any representations by
the franchisor about financial
performance regarding actual or
1 72
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FR 15544 et seq.
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26103
potential sales, income, or profits made
to a prospective franchise purchaser.
The franchisor must preserve materially
different copies of its FDD for 3 years,
as well as information that provides a
reasonable basis for any financial
performance representation it elects to
make. These requirements are subject to
the PRA and underlie the Commission’s
pursuit of renewed OMB clearance.
Estimated annual hours burden:
16,750 hours.
Based on a review of trade
publications and information from state
regulatory authorities, staff believes
that, on average, from year to year, there
are approximately 2,500 sellers of
franchises covered by the Rule, with
perhaps about 10% of that total
reflecting an equal amount of new and
departing business entrants.2
Commission staff’s burden hour
estimate reflects the incremental tasks
that the Rule may impose beyond the
information and recordkeeping
requirements imposed by state law and/
or followed by franchisors who have
been using the FDD disclosure format
nationwide. This estimate likely
overstates the actual incremental burden
because some franchisors, for various
reasons, may not be covered by the Rule
(e.g., they sell only franchises that
qualify for the Rule’s large franchise
investment exemption of at least $1
million).
Staff estimates that the average annual
disclosure burden to update existing
disclosure documents will be three
hours each for the 2,250 established
franchisors, or 6,750 hours cumulatively
for them, and 30 hours apiece each year
for the 250 or so new-entrant franchisors
to prepare their initial disclosure
documents, or 7,500 hours,
cumulatively, for the latter group. These
estimates parallel staff’s 2014 estimates
for the amended Rule.3 No public
comments were received on those prior
estimates. Accordingly, the FTC retains
them for this analysis subject to further
opportunity for public comment.
Under the Rule, a franchisor is
required to retain copies of receipts of
disclosure documents, as well as
materially different versions of its
disclosure documents. Such
recordkeeping requirements, however,
are consistent with, or less burdensome
than, those imposed by the states that
have franchise registration and
disclosure laws. Accordingly, staff
2 This number, which was also used in the FTC’s
2014 clearance request, appears to be consistent
with the number of business format franchise
offerings registered in compliance with state
franchise laws, and listed in franchise directories.
3 See 79 FR 41284 (Jul. 15, 2014); 79 FR 59771
(Oct. 3, 2014) (‘‘2014 Notices’’).
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Federal Register / Vol. 82, No. 107 / Tuesday, June 6, 2017 / Notices
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believes that incremental recordkeeping
burden, if any, would be de minimis.
Covered franchisors also may need to
maintain a record of the single
additional FDD for use in nonregistration states, which may differ
from FDDs used in registration states.
This may require as much as an
additional hour of recordkeeping per
year. Assuming, as FTC staff has in the
past, an hour of incremental
recordkeeping per covered franchisor,
this yields an additional cumulative
total of 2,500 hours for all covered
franchisors.
Based on the above assumptions and
estimates, average annual burden for
new and established franchisors during
a prospective three-year clearance
would be 16,750 hours ((30 hours of
annual disclosure burden × 250 new
franchisors) + (3 hours of average
annual disclosure burden × 2,250
established franchisors) + (1 hour of
annual recordkeeping burden × 2,500
franchisors)).
Estimated annual labor cost burden:
$3,600,000.
Labor costs are derived by applying
appropriate hourly cost figures to the
burden hours described above. The
hourly rates used below are estimated
averages.
Commission staff anticipates that an
attorney will prepare the disclosure
document. Applying the above
assumptions to an estimated hourly
attorney rate of $250 4 yields the
following annual totals: $7,500 (30
hours × $250) per new franchisor (or,
$1,875,000, cumulatively, for 250 new
franchisors) and $750 (3 hours × $250)
per established franchisor (or,
$1,687,500, cumulatively, for 2,250
established franchisors).
The FTC additionally anticipates that
recordkeeping under the Rule will be
performed by clerical staff at
approximately $15 per hour.5 Thus,
2,500 hours of recordkeeping burden
per year for all covered franchisors will
4 Commission staff believes this is a reasonable
proxy for mean hourly attorney rates for franchisor
consultation on compliance with the Rule’s
disclosure and recordkeepings requirements.
5 Based on mean hourly wages for file clerks
found in ‘‘Occupational Employment and Wages—
May 2016,’’ U.S. Department of Labor, released
March 31, 2017, Table 1, available at https://
www.bls.gov/news.release/ocwage.nr0.htm. In
contrast to labor costing above for attorneys, see
note 4 supra and accompanying text, FTC staff has
drawn upon BLS wage data for file clerks because
staff believes it presents a representative proxy for
recordkeeping tasks under the Rule. The mean
hourly wage rate for ‘‘lawyers’’ within this BLS
table, however, is just $67.25, which staff believes
greatly understates the hourly cost for lawyer
consultation tied to the Rule.
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amount to a total annual labor cost of
$37,500.
Cumulatively, then, total estimated
labor cost under the Rule is $3,600,000
(($7,500 attorney costs × 250 new
franchisors = $1,875,000) + ($750
attorney costs × 2,250 established
franchisors = $1,687,500) + ($15 clerical
costs × 2,500 franchisors = $37,500)).
Estimated non-labor costs: $8,000,000
In developing cost estimates initially
for this Rule, FTC staff consulted with
practitioners who prepare disclosure
documents for a cross-section of
franchise systems. The FTC believes
that its cost estimates remain
representative of the costs incurred by
franchise systems generally. In addition,
many franchisors establish and maintain
Web sites for ordinary business
purposes, including advertising their
goods or services and to facilitate
communication with the public.
Accordingly, any costs franchisors
would incur specifically as a result of
electronic disclosure under the Rule
appear to be minimal.
As set forth in the 2014 Notices, FTC
staff estimates that the non-labor burden
incurred by franchisors under the
Franchise Rule differs based on the
length of the disclosure document and
the number of them produced. Staff
estimates that 2,000 franchisors (80% of
total franchisors covered by the Rule)
will print and mail 100 disclosure
documents at $35 each. Thus, these
franchisors would each incur an
estimated $3,500 in printing and
mailing costs. Staff estimates that the
remaining 20% of covered franchisors
(500) will transmit 50% of their 100
disclosure documents electronically, at
$5 per electronic disclosure. Thus, these
franchisors will each incur $2,000 in
distribution costs (($250 for electronic
disclosure [$5 for electronic disclosure
× 50 disclosure documents]) + ($1,750
for printing and mailing [$35 for
printing and mailing × 50 disclosure
documents])).
Accordingly, the cumulative annual
non-labor costs for the Rule is
approximately $8,000,000 (($3,500
printing and mailing costs × 2,000
franchisors = $7,000,000) + ($250
electronic distribution costs + $1,750
printing and mailing costs) × 500
franchisors = $1,000,000)).
Request for Comment: You can file a
comment online or on paper. For the
FTC to consider your comment, we
must receive it on or before August 7,
2017. Write ‘‘Franchise Rule, PRA
Comment, FTC File No. P094400’’ on
your comment. Your comment—
including your name and your state—
will be placed on the public record of
this proceeding, including, to the extent
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practicable, on the public Commission
Web site, at https://www.ftc.gov/policy/
public-comments.
Postal mail addressed to the
Commission is subject to delay due to
heightened security screening. As a
result, we encourage you to submit your
comments online. To make sure that the
Commission considers your online
comment, you must file it at https://
ftcpublic.commentworks.com/ftc/
franchiserulePRA, by following the
instructions on the web-based form.
When this Notice appears at https://
www.regulations.gov/#!home, you also
may file a comment through that Web
site.
If you file your comment on paper,
write ‘‘Franchise Rule, PRA Comment,
FTC File No. P094400’’ on your
comment and on the envelope, and mail
your comment to the following address:
Federal Trade Commission, Office of the
Secretary, 600 Pennsylvania Avenue
NW., Suite CC–5610 (Annex J),
Washington, DC 20580, or deliver your
comment to the following address:
Federal Trade Commission, Office of the
Secretary, Constitution Center, 400 7th
Street, SW., 5th Floor, Suite 5610,
Washington, DC 20024. If possible,
please submit your paper comment to
the Commission by courier or overnight
service.
Because your comment will be placed
on the publicly accessible FTC Web site
at https://www.ftc.gov/, you are solely
responsible for making sure that your
comment does not include any sensitive
or confidential information. In
particular, your comment should not
include any sensitive personal
information, such as your or anyone
else’s Social Security number; date of
birth; driver’s license number or other
state identification number, or foreign
country equivalent; passport number;
financial account number; or credit or
debit card number. You are also solely
responsible for making sure that your
comment does not include any sensitive
health information, such as medical
records or other individually
identifiable health information. In
addition, your comment should not
include any ‘‘trade secret or any
commercial or financial information
which . . . is privileged or
confidential’’—as provided by Section
6(f) of the FTC Act, 15 U.S.C. 46(f), and
FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)—
including in particular competitively
sensitive information such as costs,
sales statistics, inventories, formulas,
patterns, devices, manufacturing
processes, or customer names.
Comments containing material for
which confidential treatment is
requested must be filed in paper form,
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Federal Register / Vol. 82, No. 107 / Tuesday, June 6, 2017 / Notices
must be clearly labeled ‘‘Confidential,’’
and must comply with FTC Rule 4.9(c).
In particular, the written request for
confidential treatment that accompanies
the comment must include the factual
and legal basis for the request, and must
identify the specific portions of the
comment to be withheld from the public
record. See FTC Rule 4.9(c). Your
comment will be kept confidential only
if the General Counsel grants your
request in accordance with the law and
the public interest. Once your comment
has been posted on the public FTC Web
site—as legally required by FTC Rule
4.9(b)—we cannot redact or remove
your comment from the FTC Web site,
unless you submit a confidentiality
request that meets the requirements for
such treatment under FTC Rule 4.9(c),
and the General Counsel grants that
request.
Visit the FTC Web site to read this
Notice. The FTC Act and other laws that
the Commission administers permit the
collection of public comments to
consider and use in this proceeding as
appropriate. The Commission will
consider all timely and responsive
public comments that it receives on or
before August 7, 2017. For information
on the Commission’s privacy policy,
including routine uses permitted by the
Privacy Act, see https://www.ftc.gov/
site-information/privacy-policy.
David C. Shonka,
Acting General Counsel.
[FR Doc. 2017–11600 Filed 6–5–17; 8:45 am]
(to
obtain a roster of members, agenda or
minutes of the non-confidential portions
of this meeting.)
Mrs. Bonnie Campbell, Committee
Management Officer, Office of
Extramural Research Education and
Priority Populations, AHRQ, 5600
Fishers Lane, Rockville, Maryland
20857, Telephone (301) 427–1554.
SUPPLEMENTARY INFORMATION: This
meeting will be closed to the public in
accordance with 5 U.S.C. App. 2 section
10(d), 5 U.S.C. 552b(c)(4), and 5 U.S.C.
552b(c)(6). In accordance with section
10 (a)(2) of the Federal Advisory
Committee Act (5 U.S.C. App. 2), AHRQ
announces the meeting of the scientific
peer review group listed above, which is
a subcommittee of AHRQ’s Health
Services Research Initial Review Group
Committee. This subcommittee meeting
will be closed to the public in
accordance with the provisions set forth
in 5 U.S.C. App. 2 section 10(d), 5
U.S.C. 552b(c)(4), and 5 U.S.C.
552b(c)(6) The grant applications and
the discussions could disclose
confidential trade secrets or commercial
property such as patentable material,
and personal information concerning
individuals associated with the grant
applications, the disclosure of which
would constitute a clearly unwarranted
invasion of personal privacy.
Agenda items for these meetings are
subject to change as priorities dictate.
FOR FURTHER INFORMATION CONTACT:
Sharon B. Arnold,
Deputy Director.
BILLING CODE 6750–01–P
[FR Doc. 2017–11587 Filed 6–5–17; 8:45 am]
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
BILLING CODE 4160–90–P
Agency for Healthcare Research and
Quality
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Notice of Meeting
Centers for Disease Control and
Prevention
Agency for Healthcare Research
and Quality (AHRQ), HHS.
ACTION: Notice of one AHRQ
Subcommittee Meeting by Telephone
Conference.
AGENCY:
The subcommittee listed
below is part of AHRQ’s Health Services
Research Initial Review Group
Committee. Grant applications are to be
reviewed and discussed at this meeting.
Name of Subcommittee: Health Care
Research Training 2.
DATES: July 13, 2017 (Open from 1:00
p.m. to 1:30 a.m. and closed for
remainder of the meeting).
Place: Agency for Healthcare Research
and Quality, 5600 Fishers Lane,
Conference Room TBD, Rockville, MD
20857.
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SUMMARY:
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Office for State, Tribal, Local and
Territorial Support (OSTLTS)
In accordance with Presidential
Executive Order No. 13175, November
6, 2000, and the Presidential
Memorandum of November 5, 2009, and
September 23, 2004, Consultation and
Coordination with Indian Tribal
Governments, CDC/Agency for Toxic
Substances and Disease Registry
(ATSDR), announces the following
meeting and Tribal Consultation
Session:
Name: CDC/ATSDR Tribal Advisory
Committee (TAC) Meeting and 17th
Biannual Tribal Consultation Session.
Dates And Times:
August 8, 2017
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26105
• 8:00–9:00 a.m., CDT—Tribal Caucus
(Open only to elected tribal leaders
and by invitation)
• 9:00 a.m.–5:00 p.m., CDT—TAC
Meeting (Open to the public)
August 9, 2017
• 8:00–9:00 a.m., EDT—Tribal Caucus
(Open only to elected tribal leaders
and by invitation)
• 9:00 a.m.–3:00 p.m., CDT—TAC
Meeting (Open to the public)
• 3:00–5:00 p.m., CDT—Tribal
Consultation Session (Open to the
public).
Please note that the TAC reserves the
right to call a tribal caucus at any time
during the public portions of the TAC
meeting, and those who are not elected
tribal leaders will be asked to step out
of the meeting room during any ad hoc
caucus periods.
Place: The CDC/ATSDR TAC Meeting
and Biannual Tribal Consultation
Session will be held at the Artesian
Hotel, 1001 W. 1st Street, Sulphur, OK
73086.
Status: The meeting and consultation
session are in-person only and open to
the public except during tribal caucus as
described in the time and date section.
Attendees must pre-register for the TAC
meeting and/or Tribal Consultation
Session by 5:00 p.m. (EDT) on Friday,
July 7, 2017, at the following link:
www.cdc.gov/tribal/meetings.html.
Purpose: The purpose of the TAC and
consultation meetings is to advance
CDC/ATSDR support for and
collaboration with American Indian and
Alaska Native (AI/AN) tribes and to
improve the health of AI/AN tribes by
pursuing goals that include assisting in
eliminating the health disparities faced
by AI/AN tribes; ensuring that access to
critical health and human services and
public health services is maximized to
advance or enhance the social, physical,
and economic status of AI/ANs; and
promoting health equity for all Indian
people and communities. To advance
these goals, CDC/ATSDR conducts
government-to-government
consultations with elected tribal
officials or their authorized
representatives. Consultation is an
enhanced form of communication that
emphasizes trust, respect, and shared
responsibility. It is an open and free
exchange of information and opinion
among parties that leads to mutual
understanding.
Matters for Discussion: This TAC
Meeting and Biannual Tribal
Consultation Session will provide
opportunities for tribal leaders to speak
openly about the public health issues
affecting their tribes. These meetings
will include discussions about tribal
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Agencies
[Federal Register Volume 82, Number 107 (Tuesday, June 6, 2017)]
[Notices]
[Pages 26103-26105]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-11600]
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FEDERAL TRADE COMMISSION
Agency Information Collection Activities; Proposed Collection;
Comment Request
AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: The FTC intends to ask the Office of Management and Budget
(``OMB'') to extend for an additional three years the current Paperwork
Reduction Act (``PRA'') clearance for information collection
requirements contained in its Trade Regulation Rule on Disclosure
Requirements and Prohibitions Concerning Franchising (``Franchise
Rule'' or ``Rule''). That clearance expires on November 30, 2017.
DATES: Comments must be submitted by August 7, 2017.
ADDRESSES: Interested parties may file a comment online or on paper, by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Write ``Franchise Rule, PRA
Comment, FTC File No. P094400'' on your comment, and file your comment
online at https://ftcpublic.commentworks.com/ftc/franchiserulePRA by
following the instructions on the web-based form. If you prefer to file
your comment on paper, mail your comment to the following address:
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania
Avenue NW., Suite CC-5610 (Annex J), Washington, DC 20580, or deliver
your comment to the following address: Federal Trade Commission, Office
of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor,
Suite 5610 (Annex J), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Requests for additional information
should be addressed to Craig Tregillus, Attorney, Division of Marketing
Practices, Bureau of Consumer Protection, Federal Trade Commission, 600
Pennsylvania Avenue NW., Room 8607, Washington, DC 20580, (202) 326-
2970.
SUPPLEMENTARY INFORMATION: Under the PRA, 44 U.S.C. 3501-3521, federal
agencies must obtain approval from OMB for each collection of
information they conduct or sponsor. ``Collection of information''
means agency requests or requirements that members of the public submit
reports, keep records, or provide information to a third party. 44
U.S.C. 3502(3); 5 CFR 1320.3(c). As required by section 3506(c)(2)(A)
of the PRA, the FTC is providing this opportunity for public comment
before requesting that OMB extend the existing clearance for the
information collection requirements contained in the Franchise Rule, 16
CFR part 436 (OMB Control No. 3084-0107).
The FTC invites comments on: (1) Whether the proposed collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility, and clarity of the information to be collected; and (4) ways
to minimize the burden of the collection of information on those who
are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology, e.g., permitting electronic
submission of responses.
The Franchise Rule ensures that consumers who are considering a
franchise investment have access to the material information they need
to make an informed investment decision provided in a format that
facilitates comparisons of different franchise offerings. The Rule
requires that franchisors disclose this information to consumers and
maintain records to facilitate enforcement of the Rule.
Amendments to the Rule promulgated on March 30, 2007, which took
effect after a one-year phase-in on July 1, 2008, merged the Rule's
disclosure requirements with the disclosure format accepted by 15
states that have franchise registration or disclosure laws.\1\ The
amended Rule has significantly minimized any compliance burden beyond
what is already required by state law.
---------------------------------------------------------------------------
\1\ 72 FR 15544 et seq.
---------------------------------------------------------------------------
The amended Rule requires franchisors to furnish prospective
purchasers with a Franchise Disclosure Document (``FDD'') that provides
information relating to the franchisor, its business, the nature of the
proposed franchise, and any representations by the franchisor about
financial performance regarding actual or potential sales, income, or
profits made to a prospective franchise purchaser. The franchisor must
preserve materially different copies of its FDD for 3 years, as well as
information that provides a reasonable basis for any financial
performance representation it elects to make. These requirements are
subject to the PRA and underlie the Commission's pursuit of renewed OMB
clearance.
Estimated annual hours burden: 16,750 hours.
Based on a review of trade publications and information from state
regulatory authorities, staff believes that, on average, from year to
year, there are approximately 2,500 sellers of franchises covered by
the Rule, with perhaps about 10% of that total reflecting an equal
amount of new and departing business entrants.\2\ Commission staff's
burden hour estimate reflects the incremental tasks that the Rule may
impose beyond the information and recordkeeping requirements imposed by
state law and/or followed by franchisors who have been using the FDD
disclosure format nationwide. This estimate likely overstates the
actual incremental burden because some franchisors, for various
reasons, may not be covered by the Rule (e.g., they sell only
franchises that qualify for the Rule's large franchise investment
exemption of at least $1 million).
---------------------------------------------------------------------------
\2\ This number, which was also used in the FTC's 2014 clearance
request, appears to be consistent with the number of business format
franchise offerings registered in compliance with state franchise
laws, and listed in franchise directories.
---------------------------------------------------------------------------
Staff estimates that the average annual disclosure burden to update
existing disclosure documents will be three hours each for the 2,250
established franchisors, or 6,750 hours cumulatively for them, and 30
hours apiece each year for the 250 or so new-entrant franchisors to
prepare their initial disclosure documents, or 7,500 hours,
cumulatively, for the latter group. These estimates parallel staff's
2014 estimates for the amended Rule.\3\ No public comments were
received on those prior estimates. Accordingly, the FTC retains them
for this analysis subject to further opportunity for public comment.
---------------------------------------------------------------------------
\3\ See 79 FR 41284 (Jul. 15, 2014); 79 FR 59771 (Oct. 3, 2014)
(``2014 Notices'').
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Under the Rule, a franchisor is required to retain copies of
receipts of disclosure documents, as well as materially different
versions of its disclosure documents. Such recordkeeping requirements,
however, are consistent with, or less burdensome than, those imposed by
the states that have franchise registration and disclosure laws.
Accordingly, staff
[[Page 26104]]
believes that incremental recordkeeping burden, if any, would be de
minimis.
Covered franchisors also may need to maintain a record of the
single additional FDD for use in non-registration states, which may
differ from FDDs used in registration states. This may require as much
as an additional hour of recordkeeping per year. Assuming, as FTC staff
has in the past, an hour of incremental recordkeeping per covered
franchisor, this yields an additional cumulative total of 2,500 hours
for all covered franchisors.
Based on the above assumptions and estimates, average annual burden
for new and established franchisors during a prospective three-year
clearance would be 16,750 hours ((30 hours of annual disclosure burden
x 250 new franchisors) + (3 hours of average annual disclosure burden x
2,250 established franchisors) + (1 hour of annual recordkeeping burden
x 2,500 franchisors)).
Estimated annual labor cost burden: $3,600,000.
Labor costs are derived by applying appropriate hourly cost figures
to the burden hours described above. The hourly rates used below are
estimated averages.
Commission staff anticipates that an attorney will prepare the
disclosure document. Applying the above assumptions to an estimated
hourly attorney rate of $250 \4\ yields the following annual totals:
$7,500 (30 hours x $250) per new franchisor (or, $1,875,000,
cumulatively, for 250 new franchisors) and $750 (3 hours x $250) per
established franchisor (or, $1,687,500, cumulatively, for 2,250
established franchisors).
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\4\ Commission staff believes this is a reasonable proxy for
mean hourly attorney rates for franchisor consultation on compliance
with the Rule's disclosure and recordkeepings requirements.
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The FTC additionally anticipates that recordkeeping under the Rule
will be performed by clerical staff at approximately $15 per hour.\5\
Thus, 2,500 hours of recordkeeping burden per year for all covered
franchisors will amount to a total annual labor cost of $37,500.
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\5\ Based on mean hourly wages for file clerks found in
``Occupational Employment and Wages--May 2016,'' U.S. Department of
Labor, released March 31, 2017, Table 1, available at https://www.bls.gov/news.release/ocwage.nr0.htm. In contrast to labor
costing above for attorneys, see note 4 supra and accompanying text,
FTC staff has drawn upon BLS wage data for file clerks because staff
believes it presents a representative proxy for recordkeeping tasks
under the Rule. The mean hourly wage rate for ``lawyers'' within
this BLS table, however, is just $67.25, which staff believes
greatly understates the hourly cost for lawyer consultation tied to
the Rule.
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Cumulatively, then, total estimated labor cost under the Rule is
$3,600,000 (($7,500 attorney costs x 250 new franchisors = $1,875,000)
+ ($750 attorney costs x 2,250 established franchisors = $1,687,500) +
($15 clerical costs x 2,500 franchisors = $37,500)).
Estimated non-labor costs: $8,000,000
In developing cost estimates initially for this Rule, FTC staff
consulted with practitioners who prepare disclosure documents for a
cross-section of franchise systems. The FTC believes that its cost
estimates remain representative of the costs incurred by franchise
systems generally. In addition, many franchisors establish and maintain
Web sites for ordinary business purposes, including advertising their
goods or services and to facilitate communication with the public.
Accordingly, any costs franchisors would incur specifically as a result
of electronic disclosure under the Rule appear to be minimal.
As set forth in the 2014 Notices, FTC staff estimates that the non-
labor burden incurred by franchisors under the Franchise Rule differs
based on the length of the disclosure document and the number of them
produced. Staff estimates that 2,000 franchisors (80% of total
franchisors covered by the Rule) will print and mail 100 disclosure
documents at $35 each. Thus, these franchisors would each incur an
estimated $3,500 in printing and mailing costs. Staff estimates that
the remaining 20% of covered franchisors (500) will transmit 50% of
their 100 disclosure documents electronically, at $5 per electronic
disclosure. Thus, these franchisors will each incur $2,000 in
distribution costs (($250 for electronic disclosure [$5 for electronic
disclosure x 50 disclosure documents]) + ($1,750 for printing and
mailing [$35 for printing and mailing x 50 disclosure documents])).
Accordingly, the cumulative annual non-labor costs for the Rule is
approximately $8,000,000 (($3,500 printing and mailing costs x 2,000
franchisors = $7,000,000) + ($250 electronic distribution costs +
$1,750 printing and mailing costs) x 500 franchisors = $1,000,000)).
Request for Comment: You can file a comment online or on paper. For
the FTC to consider your comment, we must receive it on or before
August 7, 2017. Write ``Franchise Rule, PRA Comment, FTC File No.
P094400'' on your comment. Your comment--including your name and your
state--will be placed on the public record of this proceeding,
including, to the extent practicable, on the public Commission Web
site, at https://www.ftc.gov/policy/public-comments.
Postal mail addressed to the Commission is subject to delay due to
heightened security screening. As a result, we encourage you to submit
your comments online. To make sure that the Commission considers your
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/franchiserulePRA, by following the instructions on the web-based
form. When this Notice appears at https://www.regulations.gov/#!home,
you also may file a comment through that Web site.
If you file your comment on paper, write ``Franchise Rule, PRA
Comment, FTC File No. P094400'' on your comment and on the envelope,
and mail your comment to the following address: Federal Trade
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite
CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the
following address: Federal Trade Commission, Office of the Secretary,
Constitution Center, 400 7th Street, SW., 5th Floor, Suite 5610,
Washington, DC 20024. If possible, please submit your paper comment to
the Commission by courier or overnight service.
Because your comment will be placed on the publicly accessible FTC
Web site at https://www.ftc.gov/, you are solely responsible for making
sure that your comment does not include any sensitive or confidential
information. In particular, your comment should not include any
sensitive personal information, such as your or anyone else's Social
Security number; date of birth; driver's license number or other state
identification number, or foreign country equivalent; passport number;
financial account number; or credit or debit card number. You are also
solely responsible for making sure that your comment does not include
any sensitive health information, such as medical records or other
individually identifiable health information. In addition, your comment
should not include any ``trade secret or any commercial or financial
information which . . . is privileged or confidential''--as provided by
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2),
16 CFR 4.10(a)(2)--including in particular competitively sensitive
information such as costs, sales statistics, inventories, formulas,
patterns, devices, manufacturing processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form,
[[Page 26105]]
must be clearly labeled ``Confidential,'' and must comply with FTC Rule
4.9(c). In particular, the written request for confidential treatment
that accompanies the comment must include the factual and legal basis
for the request, and must identify the specific portions of the comment
to be withheld from the public record. See FTC Rule 4.9(c). Your
comment will be kept confidential only if the General Counsel grants
your request in accordance with the law and the public interest. Once
your comment has been posted on the public FTC Web site--as legally
required by FTC Rule 4.9(b)--we cannot redact or remove your comment
from the FTC Web site, unless you submit a confidentiality request that
meets the requirements for such treatment under FTC Rule 4.9(c), and
the General Counsel grants that request.
Visit the FTC Web site to read this Notice. The FTC Act and other
laws that the Commission administers permit the collection of public
comments to consider and use in this proceeding as appropriate. The
Commission will consider all timely and responsive public comments that
it receives on or before August 7, 2017. For information on the
Commission's privacy policy, including routine uses permitted by the
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.
David C. Shonka,
Acting General Counsel.
[FR Doc. 2017-11600 Filed 6-5-17; 8:45 am]
BILLING CODE 6750-01-P