Rules, Regulations, Statements of General Policy or Interpretation and Exemptions Under the Fair Packaging and Labeling Act, 71686-71689 [2015-28918]
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Federal Register / Vol. 80, No. 221 / Tuesday, November 17, 2015 / Rules and Regulations
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BILLING CODE 4910–13–P
FEDERAL TRADE COMMISSION
16 CFR Parts 500 and 502
RIN 3084–AB33
Rules, Regulations, Statements of
General Policy or Interpretation and
Exemptions Under the Fair Packaging
and Labeling Act
Federal Trade Commission
(‘‘FTC’’ or ‘‘Commission’’).
ACTION: Final rule.
AGENCY:
The Commission amends the
rules and regulations promulgated
under the Fair Packaging and Labeling
Act (‘‘Rules’’) to: Modernize the placeof-business listing requirement;
incorporate a more comprehensive
metric chart; address the use of
exponents with customary inch/pound
measurements; delete outdated
prohibitions on retail price sales
representations; and acknowledge the
role of the weights-and-measures laws
of individual states.
DATES: This rule is effective on
December 17, 2015. The incorporation
by reference of certain publications
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SUMMARY:
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listed in the regulations is approved by
the Director of the Federal Register as of
December 17, 2015.
ADDRESSES: Relevant portions of the
proceeding, including this document,
are available at the Commission’s Web
site, www.ftc.gov.
FOR FURTHER INFORMATION CONTACT:
Megan E. Gray, Attorney, (202) 326–
3408, Division of Enforcement, Bureau
of Consumer Protection, Federal Trade
Commission, 600 Pennsylvania Avenue
NW., Washington, DC 20580.
SUPPLEMENTARY INFORMATION:
I. Introduction
Congress enacted the Fair Packaging
and Labeling Act, 15 U.S.C. 1451 et seq.,
(‘‘FPLA’’ or ‘‘Act’’) in 1966 to enable
consumers to obtain accurate package
quantity information to facilitate value
comparisons and prevent unfair or
deceptive packaging and labeling of
‘‘consumer commodities.’’ 1 Pursuant to
the FPLA, the Commission promulgated
the Rules, which generally concern
products consumed during household
use. However, several categories of these
products are exempt from FTC
regulations under the FPLA.2 Moreover,
the FTC has excluded certain others
from the Rules.3
Section 1453 of the Act directs the
Commission to issue regulations
requiring that all ‘‘consumer
commodities’’ be labeled to disclose: (a)
The identity of the commodity (e.g.,
detergent, sponges), which must appear
on the principal display panel of the
commodity in conspicuous type and
position so that identity is easy to read
and understand; 4 (b) the name and
place of business of the product’s
manufacturer, packer, or distributor; 5
1 Consumer commodities are any food, device, or
cosmetic, and any other article, product, or
commodity that is customarily produced or
distributed for sale through retail sales agencies or
instrumentalities for consumption or use by
individuals for purposes of personal care or in the
performance of services ordinarily rendered within
the household, and which usually is consumed or
expended in the course of such consumption or use.
15 U.S.C. 1459(a). The Food and Drug
Administration (‘‘FDA’’) administers the FPLA with
respect to food, drugs, cosmetics, and medical
devices. 15 U.S.C. 1454(a); 15 U.S.C. 1456(a).
2 15 U.S.C. 1459(a)(1–5) (excluding, among other
products, specified categories of meat, poultry,
tobacco, insecticide, fungicide, drug, alcohol, and
seed products).
3 16 CFR 503.2, 503.5. Many products outside the
scope of the FPLA and the Rules nevertheless fall
within the purview of individual state laws. 15
U.S.C. 1461. See also National Institute of
Standards and Technology Handbook 130, Uniform
Laws and Regulations in the areas of legal
metrology and engine fuel quality (2015 ed.)
(compilation of state and federal laws and
regulations pertaining to product labeling and
packaging).
4 16 CFR 500.4.
5 16 CFR 500.5.
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and (c) the net quantity of contents in
terms of weight, measure, or numerical
count, with such disclosure’s placement
and content in accordance with the
Rules.6 The Rules detail how units of
weight or mass and measure must be
stated, and require use of both U.S. (e.g.,
pounds, feet, and gallons) and metric
measures.7 The Rules also require net
quantity disclosures for packages
containing more than one product or
unit, including: (a) ‘‘multi-unit
packages’’; 8 (b) ‘‘variety packages’’; 9
and (c) ‘‘combination packages.’’ 10
In addition, the Act grants the FTC
authority to issue rules to prevent
consumer deception and facilitate value
comparisons.11 The FTC has used this
authority to address three types of
representations: ‘‘cents-off,’’ 12
‘‘introductory offer,’’ 13 and ‘‘economy
size.’’ 14
As part of its ongoing regulatory
review program, the Commission
published an Advance Notice of
Proposed Rulemaking (‘‘ANPR’’) in
March 2014 seeking comment on the
economic impact of, and the continuing
need for, the Rules; the benefits of the
6 16 CFR 500.6(b). The Office of Weights and
Measures of the National Institute of Standards and
Technology, U.S. Department of Commerce, is
authorized to promote, to the greatest practical
extent, uniformity in state and federal regulation of
the labeling of consumer commodities. 15 U.S.C.
1458(a)(2).
7 Congress amended the FPLA in 1992 to require
use of metric measurements, in addition to
customary inch/pound measures. Pub. L. 102–245
(February 14, 1992); Pub. L. 102–329 (August 3,
1992). In 1994, the FTC modified its regulations
accordingly. 59 FR 1872 (Jan. 12, 1994).
8 16 CFR 500.27.
9 16 CFR 500.28.
10 16 CFR 500.29.
11 15 U.S.C. 1454(c). This discretionary authority
enables the FTC to address four situations: (1)
Setting standards for characterizing package sizes to
supplement the net quantity statement (e.g.,
establishing a uniform size for a single sheet of
toilet paper); (2) regulating packaging that claims a
product price is lower than its customary retail
price; (3) requiring labels to use common names or
listing ingredients in order of decreasing
prominence; and (4) preventing nonfunctional
slack-fill. 15 U.S.C. 1454(c).
12 A cents-off representation is one in which
‘‘cents-off’’ or a similar term is used to indicate that
the consumer commodity is being offered for sale
at a price lower than the ordinary and customary
retail price. 16 CFR 502.100.
13 An introductory offer is one in which
‘‘introductory offer’’ or a similar phrase is used to
indicate that the consumer commodity is being
offered for sale at a price lower than the ordinary
and customary retail price. 16 CFR 502.101. The
Rules prohibit introductory offers in a trade area for
a duration in excess of six months. 16 CFR
502.101(b)(3).
14 An economy size representation is one in
which ‘‘economy size’’ or similar phrase is used to
indicate that the consumer commodity has a retail
sale price advantage due to the size of that package
or the quantity of its contents. 16 CFR 502.102.
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Federal Register / Vol. 80, No. 221 / Tuesday, November 17, 2015 / Rules and Regulations
Rules to consumers; and any burdens
the Rules place on businesses.15
In response, the Commission received
fifteen comments. Based on these
comments, the Commission issued a
Notice of Proposed Rulemaking
(‘‘NPRM’’) on February 2, 2015,
proposing several amendments to
modernize the place-of-business listing
requirement, incorporate a more
comprehensive metric chart, address the
use of exponents with customary inch/
pound measurements, delete
prohibitions on certain retail price sale
representations, and acknowledge the
role of weights-and-measures laws of
individual states.16
The Commission received nine
comments in response to the NPRM, one
from a nonprofit association
representing officials and consumers
affected by the Rules and eight from
individuals.17 The nonprofit association
approved of the Commission’s
proposals.18 One individual approved of
the Commission’s proposal to
modernize the place-of-business listing
requirement and acknowledge the role
of weights-and measures of individual
states; he also suggested the
Commission amend Section 500.5(b) to
delete the Rules’ ‘‘actual corporate
name’’ requirement, as well as amend
the Rules to acknowledge that FDA
labeling rules could be relevant to an
entity’s FPLA compliance and that the
FDA has not finalized its proposal to
permit metric measurements.19 One
individual approved of the
Commission’s proposal to modernize
the place-of-business listing
requirement; she did not address the
Commission’s other proposals.20 Six
individuals discussed extraneous topics
not material to this rulemaking.21
II. Procedures for Promulgating
Regulations Under FPLA
Commission Rule 1.26 sets forth the
procedures for promulgation of rules
under authority other than section
18(a)(1)(B) of the FTC Act; it governs
15 79
FR 15272 (March 19, 2014).
FR 5491 (February 2, 2015).
17 The Commission posted the comments at
https://www.ftc.gov/policy/public-comments/
initiative-599. Each comment has a number
correlating to the date of submission. This notice
cites comments using the last name of the
individual submitter or the name of the
organization, followed by that number.
18 Packaging and Labeling Subcommittee of the
National Conference on Weights and Measures
(‘‘NCWM’’) (1).
19 Schindler (3).
20 Lynn (5).
21 Willey (2), Signer (4), Nagpal (6), Gordon (7),
Vita (8), Anonymous (9). For example, Gordon (7)
commented on labels for genetically modified
foods.
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these FPLA amendments.22 The
effective date of any regulations issued
under the FPLA will not be prior to 30
days after publication in the Federal
Register.23
III. Amendments
Based on its consideration of the
record, the Commission amends the
Rules as explained below.
A. Modernize the Place-of-Business
Listing Requirement
Currently, the Rules require a label to
conspicuously state the name and place
of business of the manufacturer, packer,
or distributor and further specify that
the place of business statement contain
the street address, city, state, and ZIP
code. The street address, however, may
be omitted if it is listed in a current city
or telephone directory.24 The
Commission proposed revising this
exception to permit a business to omit
the street address if it is listed in any
readily accessible, well-known, widely
published, and publicly available
resource, including but not limited to a
printed directory, electronic database, or
Web site. The inclusion of ‘‘any readily
accessible, widely published, and
publicly available resource’’ in the
exception provides flexibility and is
intended to encompass new
technologies that meet these
requirements.
All the comments addressing this
proposal supported it.25 One individual
suggested that the Commission delete
the requirement that certain business
entities use their ‘‘actual corporate
name’’ (as opposed to their fictitious or
doing-business-as name). However, he
acknowledged that the requirement did
not burden business and he did not
demonstrate any benefit associated with
his suggested amendment.26
Accordingly, the Commission adopts its
proposed amendment without change.
B. Incorporate a More Comprehensive
Metric Chart
Section 500.19(a) currently contains
an incomplete metric conversion chart
that fails to list possible, albeit
uncommon, conversion factors that a
packager might use, such as weight
expressed in grain, or length expressed
in rods. The Commission proposed to
correct this omission by deleting the
current chart and incorporating by
reference the complete metric
22 16
CFR 1.26(f).
CFR 1.26(f).
24 16 CFR 500.5(a)–(e). The Act itself requires the
label to include the place of business, but does not
specify to what level of detail. 15 U.S.C. 1453(a)(1).
25 NCWM (1), Schindler (3), Lynn (5).
26 Schindler (3).
23 16
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conversion chart published in National
Institute of Standards and Technology
(NIST) Handbook 133, Checking the Net
Contents of Packaged Goods (2015 ed.,
Exhibit E, pgs. 135–157).27 Members of
the public can access the Handbook
online at NIST’s Web site,
www.NIST.gov.
The only comment addressing this
proposal approved its adoption.28
Accordingly, the Commission adopts
this proposed amendment without
change for the reasons explained in the
NPRM.
C. Address the Use of Exponents With
Customary Inch/Pound Measurements
In the current rule (Section 500.22),
exponents are not listed for customary
inch/pound measurements, but are
included in the metric examples listed
in Section 500.23(b) (e.g., cubic
centimeter—cm3). Because exponents
are not listed in the customary inch/
pound measurements, affected
businesses might think they are not
permitted, although they are common in
the marketplace and historically
sanctioned by the Office of Weights and
Measures of the National Institute of
Standards and Technology, U.S.
Department of Commerce, which is
authorized to promote uniformity in
labeling regulations.29 Therefore, the
Commission proposed to clarify the
Rules to expressly permit exponents
with customary inch/pound
measurements (e.g., cubic inches—in3).
The only comment addressing this
proposal approved its adoption.30
Accordingly, the Commission adopts
this proposed amendment without
change.
D. Delete Prohibitions on Certain Retail
Price Sales Representations
The Commission proposed to
eliminate sections addressing when and
how a packager or labeler represents a
commodity to be ‘‘cents off,’’ an
‘‘introductory offer,’’ or ‘‘economy
size.’’ 31 The Commission originally
27 The NPRM proposed to incorporate a metric
conversion chart from NIST Handbook 130, but the
Final Rule incorporates the metric conversion chart
from NIST Handbook 133. NIST Handbook 133’s
metric conversion chart is consistent with the table
provided in NIST Handbook 130, but provides a
more comprehensive listing of metric conversion
factors. This revision does not change the
obligations of entities subject to the Rules.
Therefore, pursuant to the Administrative
Procedure Act, the Commission finds ‘‘good cause’’
for foregoing additional public comment because
this change is merely ministerial and further public
comment is ‘‘unnecessary.’’ 5 U.S.C. 553(b)(3)(B).
28 NCWM (1).
29 NCWM (1).
30 NCWM (1).
31 15 U.S.C. 1454(c)(2).
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Federal Register / Vol. 80, No. 221 / Tuesday, November 17, 2015 / Rules and Regulations
promulgated these provisions to curtail
certain price representations that were
commonly used in a deceptive manner
during the 1960s and 1970s. However,
these representations are now rarely
seen in the modern marketplace.
Indeed, they have been absent for some
time.32 Should they re-appear, the
Commission has other tools at its
disposal to ensure they are not used
deceptively.
The only comment addressing this
proposal approved its adoption.33
Accordingly, the Commission adopts
this proposed amendment without
change.
E. Acknowledge the Role of Weightsand-Measures Laws of Individual States
Many products outside the
Commission’s FPLA purview fall within
the purview of weights-and-measures
laws of individual states; amending the
Rules to acknowledge the state role
would aid compliance efforts by alerting
businesses that state laws may apply.
Therefore, the Commission proposed to
amend the Rules to state ‘‘[m]any
products exempted through proceedings
under section 5(b) of the Act and section
500.3(e) of this chapter or excluded
under part 503 of this chapter
nonetheless fall within the purview of
the weights-and-measures laws of
individual states.’’
The two comments addressing this
proposal approved its adoption.34 One,
however, favored further clarification to
indicate that FDA also has a role in
FPLA regulation, but did not provide
any indication that entities were
unfamiliar with this fact. Accordingly,
the Commission adopts this proposed
amendment without change.
IV. Paperwork Reduction Act
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The Rules contain various existing
information collection requirements for
which the Commission has obtained
OMB clearance under the Paperwork
Reduction Act (‘‘PRA’’).35 Because the
amendments do not trigger additional
recordkeeping, disclosure, or reporting
requirements, there is no incremental
burden under the PRA. See 44 U.S.C.
3501–3521. None of the comments
disputed the PRA analysis in the NPRM.
32 In 1997, the U.S. Food and Drug
Administration revoked similar regulations for
‘‘cents off’’ and economy size representations, on
the grounds that such representations were no
longer used in the marketplace. 62 FR 39439 (1997).
33 NCWM (1).
34 NCWM (1), Schindler (3).
35 44 U.S.C. 3501 et seq. On April 6, 2015, OMB
granted clearance through April 30, 2018, for these
requirements and the associated PRA burden
estimates. The OMB control number is 3084–0110.
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V. Regulatory Flexibility Act
The Regulatory Flexibility Act
(‘‘RFA’’) 36 requires the Commission to
conduct an initial and final analysis of
the anticipated economic impact of the
amendments on small entities.37 The
purpose of a regulatory flexibility
analysis is to ensure the agency
considers the impacts on small entities
and examines regulatory alternatives
that could achieve the regulatory
purpose while minimizing burdens on
small entities. Section 605 of the RFA 38
provides that such an analysis is not
required if the agency head certifies that
the regulatory action will not have a
significant economic impact on a
substantial number of small entities.
The Commission believes the
amendments will not have a significant
economic impact on small entities,
although they may affect a substantial
number of small businesses. The
amendments expand labeling options to
accommodate the rise of online media,
remove unnecessary price statement
prohibitions, or are technical in nature.
In the Commission’s view, the
amendments will not have a significant
or disproportionate impact on the costs
small entities incur in manufacturing,
distributing, or selling consumer
commodities. Indeed, the Rule revisions
provide increased flexibility for
companies complying with the Rules.
Therefore, the Commission certifies that
amending the Rules will not have a
significant economic impact on a
substantial number of small businesses.
Although the Commission certifies
under the RFA that the amendments
will not have a significant impact on a
substantial number of small entities, the
Commission nonetheless has
determined it is appropriate to publish
a final regulatory flexibility analysis to
ensure the impact of the amendments
on small entities is fully addressed.
Therefore, the Commission prepared the
following analysis:
A. Need for and Objective of the
Amendments
The objective of the amendments is to
clarify and update the Rules in
accordance with marketplace practices.
The Act authorizes the Commission to
implement its requirements through the
issuance of rules. The amendments
clarify and update the Rules, and
provide covered entities with additional
labeling options without imposing
significant new burdens or additional
costs.
36 5
U.S.C. 601–612.
Commission previously conducted an RFA
analysis of the Rules. 59 FR 1862 (Jan. 12, 1994).
38 5 U.S.C. 605.
37 The
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B. Significant Issues Raised in Public
Comments
In the NPRM’s initial regulatory
flexibility analysis, the Commission
concluded that the proposed
amendments would not have a
significant or disproportionate
economic impact (including compliance
costs) on small entities that produce
consumer commodities other than those
commodities falling within the
authority of other agencies or otherwise
outside the Act’s or Rules’ scope. None
of the comments disputed the initial
regulatory flexibility analysis. The
Commission did not receive any
comments from the Small Business
Administration.
C. Small Entities to Which the
Amendments Will Apply
The amendments cover every
company in the economy that produces
consumer commodities other than those
commodities falling within the
authority of other agencies or otherwise
outside the Act’s or Rules’ scope. Based
on available information, it is not
feasible for the Commission to estimate
the number of entities within this class
of industry that are also small
companies within the meaning of the
Regulatory Flexibility Act.39 A
substantial number of these entities
likely qualify as small businesses.
Nevertheless, the Commission estimates
that the amendments will not have a
significant impact on small businesses
because the amendments do not impose
any significant new obligations. The
Commission sought, but did not receive,
comment with regard to the estimated
number or nature of small business
entities, if any, for which the
amendments would have a significant
impact.
D. Projected Reporting, Recordkeeping,
and Other Compliance Requirements,
Including Classes of Covered Small
Entities and Professional Skills Needed
To Comply
As explained earlier in this document,
the amendments expand labeling
options to accommodate the rise of
online media, remove unnecessary price
statement prohibitions, or are technical
in nature. The small entities potentially
covered by these amendments will
include all such entities subject to the
Rules. The professional skills necessary
for compliance with the Rules as
modified by the amendments will
include office and administrative
support supervisors to determine label
content and clerical personnel to draft
and obtain labels and keep records.
39 5
U.S.C. 601(3).
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E. Significant Alternatives to the
Amendments
The Commission has not proposed
any specific small entity exemption or
other significant alternatives, because
the amendments expand labeling
options to accommodate the rise of
online media, remove unnecessary price
statement prohibitions, or are technical
in nature. In addition, these changes
provide new flexibilities for small
entitities by, for example, allowing
regulated entities to omit a business
address from a label if the address is
readily available in an online directory
or other Web site. Under these limited
circumstances, the Commission does
not believe a special exemption for
small entities or significant compliance
alternatives are necessary or appropriate
to minimize the compliance burden, if
any, on small entities while achieving
the intended purposes of the proposed
amendments. Nonetheless, the
Commission sought, but did not receive,
comments on the need, if any, for
alternative compliance methods to
reduce the economic impact of the
Rules on small entities.
None of the comments addressed the
Regulatory Flexibility Act analysis in
the NPRM.
VI. Incorporation by Reference
Consistent with 1 CFR part 51, the
Commission is incorporating the
complete metric conversion chart
published in the National Institute of
Standards and Technology (NIST)
Handbook 133, Checking the Contents
of Packaged Goods (2015 ed., Exhibit E,
pgs. 135–157), as described in Section
III.B above. The metric conversion chart
provides a complete and up-to-date list
of metric conversion factors for
packagers.
The metric conversion chart is
reasonably available to interested
parties. Members of the public can
access the metric conversion chart
online at NIST’s Web site, NIST.gov.
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List of Subjects in 16 CFR Parts 500 and
502
Fair Packaging and Labeling Act,
Incorporation by reference, Labeling,
Packaging and containers, Trade
practices.
Under 15 U.S.C. 1454–1455 and as
discussed in the preamble, the Federal
Trade Commission amends title 16 of
the Code of Federal Regulations by
amending parts 500 and 502 as follows:
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PART 500—REGULATIONS UNDER
SECTION 4 OF THE FAIR PACKAGING
AND LABELING ACT
1. The authority citation for part 500
continues to read as follows:
■
Authority: 15 U.S.C. 1453, 1454, 1455.
2. In § 500.3, revise paragraph (d) to
read as follows:
■
§ 500.3 Prohibited acts, coverage, general
labeling requirements, exemption
procedures.
*
*
*
*
*
(d) Each packaged or labeled
consumer commodity, unless it has
been exempted through proceedings
under section 5(b) of the Act, shall bear
a label specifying the identity of the
commodity; the name and place of
business of the manufacturer, packer, or
distributor; the net quantity of contents;
and the net quantity per serving, use or
application, where there is a label
representation as to the number of
servings, uses, or applications
obtainable from the commodity. Many
products exempted through proceedings
under section 5(b) of the Act and section
500.3(e) of this chapter or excluded
under part 503 of this chapter
nonetheless fall within the purview of
the weights-and-measures laws of the
individual states.
*
*
*
*
*
■ 3. Revise § 500.5(c) to read as follows:
§ 500.5 Name and place of business of
manufacturer, packer or distributor.
*
*
*
*
*
(c) The statement of the place of
business shall include the street
address, city, state, and zip code;
however, the street address may be
omitted if it is listed in a readily
accessible, widely published, and
publicly available resource, including
but not limited to a printed directory,
electronic database, or Web site.
*
*
*
*
*
■ 4. In § 500.19, revise paragraph (a) to
read as follows:
§ 500.19 Conversion of SI metric quantities
to inch/pound quantities and inch/pound
quantities to SI metric quantities.
(a) For calculating the conversion of
SI metric quantities to and from
customary inch/pound quantities, the
conversion chart published in the
following handbook shall be employed:
National Institute of Standards and
Technology (NIST) Handbook 133,
Checking the Net Contents of Packaged
Goods, Appendix E—General Tables of
Units of Measurements, 2015 Edition,
adopted November 2014. This
incorporation by reference was
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71689
approved by the Director of the Federal
Register in accordance with 5 U.S.C.
552(a) and 1 CFR part 51. You may
obtain a copy of NIST Handbook 133 at
the National Institute of Standards and
Technology’s Web site, http://
www.nist.gov/pml/wmd/pubs/
hb133.cfm. You may inspect a copy at
FTC Library, (202) 326–2395, Federal
Trade Commission, Room H–630, 600
Pennsylvania Avenue NW., Washington,
DC 20580, or at the National Archives
and Records Administration (NARA).
For information on the availability of
this material at NARA, call 202–741–
6030, or go to: http://www.archives.gov/
federal-register/cfr/ibr-locations.html.
*
*
*
*
*
■
5. Revise § 500.22 to read as follows:
§ 500.22
Abbreviations.
The following abbreviations and none
other may be employed in the required
net quantity declaration:
Inch—in.
Feet or foot—ft.
Fluid—fl.
Liquid—liq.
Ounce—oz.
Gallon—gal.
Pint—pt.
Pound—lb.
Quart—qt.
Square—sq.
Weight—wt.
Yard—yd.
Avoirdupois—avdp.
Cubic—cu.
Note: Periods and plural forms shall be
optional. Exponents are permitted.
PART 502—REGULATIONS UNDER
SECTION 5(C) OF THE FAIR
PACKAGING AND LABELING ACT
6. The authority citation for part 502
is revised to read as follows:
■
Authority: 15 U.S.C. 1454, 1455.
§§ 502.100, 502.101, and 502.102
[Removed and Reserved]
7. Remove and reserve §§ 502.100,
500.101, and 502.102.
■
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2015–28918 Filed 11–16–15; 8:45 am]
BILLING CODE 6750–01–P
E:\FR\FM\17NOR1.SGM
17NOR1
Agencies
[Federal Register Volume 80, Number 221 (Tuesday, November 17, 2015)]
[Rules and Regulations]
[Pages 71686-71689]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-28918]
=======================================================================
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FEDERAL TRADE COMMISSION
16 CFR Parts 500 and 502
RIN 3084-AB33
Rules, Regulations, Statements of General Policy or
Interpretation and Exemptions Under the Fair Packaging and Labeling Act
AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').
ACTION: Final rule.
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SUMMARY: The Commission amends the rules and regulations promulgated
under the Fair Packaging and Labeling Act (``Rules'') to: Modernize the
place-of-business listing requirement; incorporate a more comprehensive
metric chart; address the use of exponents with customary inch/pound
measurements; delete outdated prohibitions on retail price sales
representations; and acknowledge the role of the weights-and-measures
laws of individual states.
DATES: This rule is effective on December 17, 2015. The incorporation
by reference of certain publications listed in the regulations is
approved by the Director of the Federal Register as of December 17,
2015.
ADDRESSES: Relevant portions of the proceeding, including this
document, are available at the Commission's Web site, www.ftc.gov.
FOR FURTHER INFORMATION CONTACT: Megan E. Gray, Attorney, (202) 326-
3408, Division of Enforcement, Bureau of Consumer Protection, Federal
Trade Commission, 600 Pennsylvania Avenue NW., Washington, DC 20580.
SUPPLEMENTARY INFORMATION:
I. Introduction
Congress enacted the Fair Packaging and Labeling Act, 15 U.S.C.
1451 et seq., (``FPLA'' or ``Act'') in 1966 to enable consumers to
obtain accurate package quantity information to facilitate value
comparisons and prevent unfair or deceptive packaging and labeling of
``consumer commodities.'' \1\ Pursuant to the FPLA, the Commission
promulgated the Rules, which generally concern products consumed during
household use. However, several categories of these products are exempt
from FTC regulations under the FPLA.\2\ Moreover, the FTC has excluded
certain others from the Rules.\3\
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\1\ Consumer commodities are any food, device, or cosmetic, and
any other article, product, or commodity that is customarily
produced or distributed for sale through retail sales agencies or
instrumentalities for consumption or use by individuals for purposes
of personal care or in the performance of services ordinarily
rendered within the household, and which usually is consumed or
expended in the course of such consumption or use. 15 U.S.C.
1459(a). The Food and Drug Administration (``FDA'') administers the
FPLA with respect to food, drugs, cosmetics, and medical devices. 15
U.S.C. 1454(a); 15 U.S.C. 1456(a).
\2\ 15 U.S.C. 1459(a)(1-5) (excluding, among other products,
specified categories of meat, poultry, tobacco, insecticide,
fungicide, drug, alcohol, and seed products).
\3\ 16 CFR 503.2, 503.5. Many products outside the scope of the
FPLA and the Rules nevertheless fall within the purview of
individual state laws. 15 U.S.C. 1461. See also National Institute
of Standards and Technology Handbook 130, Uniform Laws and
Regulations in the areas of legal metrology and engine fuel quality
(2015 ed.) (compilation of state and federal laws and regulations
pertaining to product labeling and packaging).
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Section 1453 of the Act directs the Commission to issue regulations
requiring that all ``consumer commodities'' be labeled to disclose: (a)
The identity of the commodity (e.g., detergent, sponges), which must
appear on the principal display panel of the commodity in conspicuous
type and position so that identity is easy to read and understand; \4\
(b) the name and place of business of the product's manufacturer,
packer, or distributor; \5\ and (c) the net quantity of contents in
terms of weight, measure, or numerical count, with such disclosure's
placement and content in accordance with the Rules.\6\ The Rules detail
how units of weight or mass and measure must be stated, and require use
of both U.S. (e.g., pounds, feet, and gallons) and metric measures.\7\
The Rules also require net quantity disclosures for packages containing
more than one product or unit, including: (a) ``multi-unit packages'';
\8\ (b) ``variety packages''; \9\ and (c) ``combination packages.''
\10\
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\4\ 16 CFR 500.4.
\5\ 16 CFR 500.5.
\6\ 16 CFR 500.6(b). The Office of Weights and Measures of the
National Institute of Standards and Technology, U.S. Department of
Commerce, is authorized to promote, to the greatest practical
extent, uniformity in state and federal regulation of the labeling
of consumer commodities. 15 U.S.C. 1458(a)(2).
\7\ Congress amended the FPLA in 1992 to require use of metric
measurements, in addition to customary inch/pound measures. Pub. L.
102-245 (February 14, 1992); Pub. L. 102-329 (August 3, 1992). In
1994, the FTC modified its regulations accordingly. 59 FR 1872 (Jan.
12, 1994).
\8\ 16 CFR 500.27.
\9\ 16 CFR 500.28.
\10\ 16 CFR 500.29.
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In addition, the Act grants the FTC authority to issue rules to
prevent consumer deception and facilitate value comparisons.\11\ The
FTC has used this authority to address three types of representations:
``cents-off,'' \12\ ``introductory offer,'' \13\ and ``economy size.''
\14\
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\11\ 15 U.S.C. 1454(c). This discretionary authority enables the
FTC to address four situations: (1) Setting standards for
characterizing package sizes to supplement the net quantity
statement (e.g., establishing a uniform size for a single sheet of
toilet paper); (2) regulating packaging that claims a product price
is lower than its customary retail price; (3) requiring labels to
use common names or listing ingredients in order of decreasing
prominence; and (4) preventing nonfunctional slack-fill. 15 U.S.C.
1454(c).
\12\ A cents-off representation is one in which ``cents-off'' or
a similar term is used to indicate that the consumer commodity is
being offered for sale at a price lower than the ordinary and
customary retail price. 16 CFR 502.100.
\13\ An introductory offer is one in which ``introductory
offer'' or a similar phrase is used to indicate that the consumer
commodity is being offered for sale at a price lower than the
ordinary and customary retail price. 16 CFR 502.101. The Rules
prohibit introductory offers in a trade area for a duration in
excess of six months. 16 CFR 502.101(b)(3).
\14\ An economy size representation is one in which ``economy
size'' or similar phrase is used to indicate that the consumer
commodity has a retail sale price advantage due to the size of that
package or the quantity of its contents. 16 CFR 502.102.
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As part of its ongoing regulatory review program, the Commission
published an Advance Notice of Proposed Rulemaking (``ANPR'') in March
2014 seeking comment on the economic impact of, and the continuing need
for, the Rules; the benefits of the
[[Page 71687]]
Rules to consumers; and any burdens the Rules place on businesses.\15\
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\15\ 79 FR 15272 (March 19, 2014).
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In response, the Commission received fifteen comments. Based on
these comments, the Commission issued a Notice of Proposed Rulemaking
(``NPRM'') on February 2, 2015, proposing several amendments to
modernize the place-of-business listing requirement, incorporate a more
comprehensive metric chart, address the use of exponents with customary
inch/pound measurements, delete prohibitions on certain retail price
sale representations, and acknowledge the role of weights-and-measures
laws of individual states.\16\
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\16\ 80 FR 5491 (February 2, 2015).
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The Commission received nine comments in response to the NPRM, one
from a nonprofit association representing officials and consumers
affected by the Rules and eight from individuals.\17\ The nonprofit
association approved of the Commission's proposals.\18\ One individual
approved of the Commission's proposal to modernize the place-of-
business listing requirement and acknowledge the role of weights-and
measures of individual states; he also suggested the Commission amend
Section 500.5(b) to delete the Rules' ``actual corporate name''
requirement, as well as amend the Rules to acknowledge that FDA
labeling rules could be relevant to an entity's FPLA compliance and
that the FDA has not finalized its proposal to permit metric
measurements.\19\ One individual approved of the Commission's proposal
to modernize the place-of-business listing requirement; she did not
address the Commission's other proposals.\20\ Six individuals discussed
extraneous topics not material to this rulemaking.\21\
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\17\ The Commission posted the comments at https://www.ftc.gov/policy/public-comments/initiative-599. Each comment has a number
correlating to the date of submission. This notice cites comments
using the last name of the individual submitter or the name of the
organization, followed by that number.
\18\ Packaging and Labeling Subcommittee of the National
Conference on Weights and Measures (``NCWM'') (1).
\19\ Schindler (3).
\20\ Lynn (5).
\21\ Willey (2), Signer (4), Nagpal (6), Gordon (7), Vita (8),
Anonymous (9). For example, Gordon (7) commented on labels for
genetically modified foods.
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II. Procedures for Promulgating Regulations Under FPLA
Commission Rule 1.26 sets forth the procedures for promulgation of
rules under authority other than section 18(a)(1)(B) of the FTC Act; it
governs these FPLA amendments.\22\ The effective date of any
regulations issued under the FPLA will not be prior to 30 days after
publication in the Federal Register.\23\
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\22\ 16 CFR 1.26(f).
\23\ 16 CFR 1.26(f).
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III. Amendments
Based on its consideration of the record, the Commission amends the
Rules as explained below.
A. Modernize the Place-of-Business Listing Requirement
Currently, the Rules require a label to conspicuously state the
name and place of business of the manufacturer, packer, or distributor
and further specify that the place of business statement contain the
street address, city, state, and ZIP code. The street address, however,
may be omitted if it is listed in a current city or telephone
directory.\24\ The Commission proposed revising this exception to
permit a business to omit the street address if it is listed in any
readily accessible, well-known, widely published, and publicly
available resource, including but not limited to a printed directory,
electronic database, or Web site. The inclusion of ``any readily
accessible, widely published, and publicly available resource'' in the
exception provides flexibility and is intended to encompass new
technologies that meet these requirements.
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\24\ 16 CFR 500.5(a)-(e). The Act itself requires the label to
include the place of business, but does not specify to what level of
detail. 15 U.S.C. 1453(a)(1).
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All the comments addressing this proposal supported it.\25\ One
individual suggested that the Commission delete the requirement that
certain business entities use their ``actual corporate name'' (as
opposed to their fictitious or doing-business-as name). However, he
acknowledged that the requirement did not burden business and he did
not demonstrate any benefit associated with his suggested
amendment.\26\ Accordingly, the Commission adopts its proposed
amendment without change.
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\25\ NCWM (1), Schindler (3), Lynn (5).
\26\ Schindler (3).
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B. Incorporate a More Comprehensive Metric Chart
Section 500.19(a) currently contains an incomplete metric
conversion chart that fails to list possible, albeit uncommon,
conversion factors that a packager might use, such as weight expressed
in grain, or length expressed in rods. The Commission proposed to
correct this omission by deleting the current chart and incorporating
by reference the complete metric conversion chart published in National
Institute of Standards and Technology (NIST) Handbook 133, Checking the
Net Contents of Packaged Goods (2015 ed., Exhibit E, pgs. 135-157).\27\
Members of the public can access the Handbook online at NIST's Web
site, www.NIST.gov.
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\27\ The NPRM proposed to incorporate a metric conversion chart
from NIST Handbook 130, but the Final Rule incorporates the metric
conversion chart from NIST Handbook 133. NIST Handbook 133's metric
conversion chart is consistent with the table provided in NIST
Handbook 130, but provides a more comprehensive listing of metric
conversion factors. This revision does not change the obligations of
entities subject to the Rules. Therefore, pursuant to the
Administrative Procedure Act, the Commission finds ``good cause''
for foregoing additional public comment because this change is
merely ministerial and further public comment is ``unnecessary.'' 5
U.S.C. 553(b)(3)(B).
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The only comment addressing this proposal approved its
adoption.\28\ Accordingly, the Commission adopts this proposed
amendment without change for the reasons explained in the NPRM.
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\28\ NCWM (1).
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C. Address the Use of Exponents With Customary Inch/Pound Measurements
In the current rule (Section 500.22), exponents are not listed for
customary inch/pound measurements, but are included in the metric
examples listed in Section 500.23(b) (e.g., cubic centimeter--cm\3\).
Because exponents are not listed in the customary inch/pound
measurements, affected businesses might think they are not permitted,
although they are common in the marketplace and historically sanctioned
by the Office of Weights and Measures of the National Institute of
Standards and Technology, U.S. Department of Commerce, which is
authorized to promote uniformity in labeling regulations.\29\
Therefore, the Commission proposed to clarify the Rules to expressly
permit exponents with customary inch/pound measurements (e.g., cubic
inches--in\3\).
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\29\ NCWM (1).
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The only comment addressing this proposal approved its
adoption.\30\ Accordingly, the Commission adopts this proposed
amendment without change.
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\30\ NCWM (1).
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D. Delete Prohibitions on Certain Retail Price Sales Representations
The Commission proposed to eliminate sections addressing when and
how a packager or labeler represents a commodity to be ``cents off,''
an ``introductory offer,'' or ``economy size.'' \31\ The Commission
originally
[[Page 71688]]
promulgated these provisions to curtail certain price representations
that were commonly used in a deceptive manner during the 1960s and
1970s. However, these representations are now rarely seen in the modern
marketplace. Indeed, they have been absent for some time.\32\ Should
they re-appear, the Commission has other tools at its disposal to
ensure they are not used deceptively.
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\31\ 15 U.S.C. 1454(c)(2).
\32\ In 1997, the U.S. Food and Drug Administration revoked
similar regulations for ``cents off'' and economy size
representations, on the grounds that such representations were no
longer used in the marketplace. 62 FR 39439 (1997).
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The only comment addressing this proposal approved its
adoption.\33\ Accordingly, the Commission adopts this proposed
amendment without change.
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\33\ NCWM (1).
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E. Acknowledge the Role of Weights-and-Measures Laws of Individual
States
Many products outside the Commission's FPLA purview fall within the
purview of weights-and-measures laws of individual states; amending the
Rules to acknowledge the state role would aid compliance efforts by
alerting businesses that state laws may apply. Therefore, the
Commission proposed to amend the Rules to state ``[m]any products
exempted through proceedings under section 5(b) of the Act and section
500.3(e) of this chapter or excluded under part 503 of this chapter
nonetheless fall within the purview of the weights-and-measures laws of
individual states.''
The two comments addressing this proposal approved its
adoption.\34\ One, however, favored further clarification to indicate
that FDA also has a role in FPLA regulation, but did not provide any
indication that entities were unfamiliar with this fact. Accordingly,
the Commission adopts this proposed amendment without change.
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\34\ NCWM (1), Schindler (3).
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IV. Paperwork Reduction Act
The Rules contain various existing information collection
requirements for which the Commission has obtained OMB clearance under
the Paperwork Reduction Act (``PRA'').\35\ Because the amendments do
not trigger additional recordkeeping, disclosure, or reporting
requirements, there is no incremental burden under the PRA. See 44
U.S.C. 3501-3521. None of the comments disputed the PRA analysis in the
NPRM.
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\35\ 44 U.S.C. 3501 et seq. On April 6, 2015, OMB granted
clearance through April 30, 2018, for these requirements and the
associated PRA burden estimates. The OMB control number is 3084-
0110.
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V. Regulatory Flexibility Act
The Regulatory Flexibility Act (``RFA'') \36\ requires the
Commission to conduct an initial and final analysis of the anticipated
economic impact of the amendments on small entities.\37\ The purpose of
a regulatory flexibility analysis is to ensure the agency considers the
impacts on small entities and examines regulatory alternatives that
could achieve the regulatory purpose while minimizing burdens on small
entities. Section 605 of the RFA \38\ provides that such an analysis is
not required if the agency head certifies that the regulatory action
will not have a significant economic impact on a substantial number of
small entities.
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\36\ 5 U.S.C. 601-612.
\37\ The Commission previously conducted an RFA analysis of the
Rules. 59 FR 1862 (Jan. 12, 1994).
\38\ 5 U.S.C. 605.
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The Commission believes the amendments will not have a significant
economic impact on small entities, although they may affect a
substantial number of small businesses. The amendments expand labeling
options to accommodate the rise of online media, remove unnecessary
price statement prohibitions, or are technical in nature.
In the Commission's view, the amendments will not have a
significant or disproportionate impact on the costs small entities
incur in manufacturing, distributing, or selling consumer commodities.
Indeed, the Rule revisions provide increased flexibility for companies
complying with the Rules. Therefore, the Commission certifies that
amending the Rules will not have a significant economic impact on a
substantial number of small businesses.
Although the Commission certifies under the RFA that the amendments
will not have a significant impact on a substantial number of small
entities, the Commission nonetheless has determined it is appropriate
to publish a final regulatory flexibility analysis to ensure the impact
of the amendments on small entities is fully addressed. Therefore, the
Commission prepared the following analysis:
A. Need for and Objective of the Amendments
The objective of the amendments is to clarify and update the Rules
in accordance with marketplace practices. The Act authorizes the
Commission to implement its requirements through the issuance of rules.
The amendments clarify and update the Rules, and provide covered
entities with additional labeling options without imposing significant
new burdens or additional costs.
B. Significant Issues Raised in Public Comments
In the NPRM's initial regulatory flexibility analysis, the
Commission concluded that the proposed amendments would not have a
significant or disproportionate economic impact (including compliance
costs) on small entities that produce consumer commodities other than
those commodities falling within the authority of other agencies or
otherwise outside the Act's or Rules' scope. None of the comments
disputed the initial regulatory flexibility analysis. The Commission
did not receive any comments from the Small Business Administration.
C. Small Entities to Which the Amendments Will Apply
The amendments cover every company in the economy that produces
consumer commodities other than those commodities falling within the
authority of other agencies or otherwise outside the Act's or Rules'
scope. Based on available information, it is not feasible for the
Commission to estimate the number of entities within this class of
industry that are also small companies within the meaning of the
Regulatory Flexibility Act.\39\ A substantial number of these entities
likely qualify as small businesses. Nevertheless, the Commission
estimates that the amendments will not have a significant impact on
small businesses because the amendments do not impose any significant
new obligations. The Commission sought, but did not receive, comment
with regard to the estimated number or nature of small business
entities, if any, for which the amendments would have a significant
impact.
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\39\ 5 U.S.C. 601(3).
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D. Projected Reporting, Recordkeeping, and Other Compliance
Requirements, Including Classes of Covered Small Entities and
Professional Skills Needed To Comply
As explained earlier in this document, the amendments expand
labeling options to accommodate the rise of online media, remove
unnecessary price statement prohibitions, or are technical in nature.
The small entities potentially covered by these amendments will include
all such entities subject to the Rules. The professional skills
necessary for compliance with the Rules as modified by the amendments
will include office and administrative support supervisors to determine
label content and clerical personnel to draft and obtain labels and
keep records.
[[Page 71689]]
E. Significant Alternatives to the Amendments
The Commission has not proposed any specific small entity exemption
or other significant alternatives, because the amendments expand
labeling options to accommodate the rise of online media, remove
unnecessary price statement prohibitions, or are technical in nature.
In addition, these changes provide new flexibilities for small
entitities by, for example, allowing regulated entities to omit a
business address from a label if the address is readily available in an
online directory or other Web site. Under these limited circumstances,
the Commission does not believe a special exemption for small entities
or significant compliance alternatives are necessary or appropriate to
minimize the compliance burden, if any, on small entities while
achieving the intended purposes of the proposed amendments.
Nonetheless, the Commission sought, but did not receive, comments on
the need, if any, for alternative compliance methods to reduce the
economic impact of the Rules on small entities.
None of the comments addressed the Regulatory Flexibility Act
analysis in the NPRM.
VI. Incorporation by Reference
Consistent with 1 CFR part 51, the Commission is incorporating the
complete metric conversion chart published in the National Institute of
Standards and Technology (NIST) Handbook 133, Checking the Contents of
Packaged Goods (2015 ed., Exhibit E, pgs. 135-157), as described in
Section III.B above. The metric conversion chart provides a complete
and up-to-date list of metric conversion factors for packagers.
The metric conversion chart is reasonably available to interested
parties. Members of the public can access the metric conversion chart
online at NIST's Web site, NIST.gov.
List of Subjects in 16 CFR Parts 500 and 502
Fair Packaging and Labeling Act, Incorporation by reference,
Labeling, Packaging and containers, Trade practices.
Under 15 U.S.C. 1454-1455 and as discussed in the preamble, the
Federal Trade Commission amends title 16 of the Code of Federal
Regulations by amending parts 500 and 502 as follows:
PART 500--REGULATIONS UNDER SECTION 4 OF THE FAIR PACKAGING AND
LABELING ACT
0
1. The authority citation for part 500 continues to read as follows:
Authority: 15 U.S.C. 1453, 1454, 1455.
0
2. In Sec. 500.3, revise paragraph (d) to read as follows:
Sec. 500.3 Prohibited acts, coverage, general labeling requirements,
exemption procedures.
* * * * *
(d) Each packaged or labeled consumer commodity, unless it has been
exempted through proceedings under section 5(b) of the Act, shall bear
a label specifying the identity of the commodity; the name and place of
business of the manufacturer, packer, or distributor; the net quantity
of contents; and the net quantity per serving, use or application,
where there is a label representation as to the number of servings,
uses, or applications obtainable from the commodity. Many products
exempted through proceedings under section 5(b) of the Act and section
500.3(e) of this chapter or excluded under part 503 of this chapter
nonetheless fall within the purview of the weights-and-measures laws of
the individual states.
* * * * *
0
3. Revise Sec. 500.5(c) to read as follows:
Sec. 500.5 Name and place of business of manufacturer, packer or
distributor.
* * * * *
(c) The statement of the place of business shall include the street
address, city, state, and zip code; however, the street address may be
omitted if it is listed in a readily accessible, widely published, and
publicly available resource, including but not limited to a printed
directory, electronic database, or Web site.
* * * * *
0
4. In Sec. 500.19, revise paragraph (a) to read as follows:
Sec. 500.19 Conversion of SI metric quantities to inch/pound
quantities and inch/pound quantities to SI metric quantities.
(a) For calculating the conversion of SI metric quantities to and
from customary inch/pound quantities, the conversion chart published in
the following handbook shall be employed: National Institute of
Standards and Technology (NIST) Handbook 133, Checking the Net Contents
of Packaged Goods, Appendix E--General Tables of Units of Measurements,
2015 Edition, adopted November 2014. This incorporation by reference
was approved by the Director of the Federal Register in accordance with
5 U.S.C. 552(a) and 1 CFR part 51. You may obtain a copy of NIST
Handbook 133 at the National Institute of Standards and Technology's
Web site, http://www.nist.gov/pml/wmd/pubs/hb133.cfm. You may inspect a
copy at FTC Library, (202) 326-2395, Federal Trade Commission, Room H-
630, 600 Pennsylvania Avenue NW., Washington, DC 20580, or at the
National Archives and Records Administration (NARA). For information on
the availability of this material at NARA, call 202-741-6030, or go to:
http://www.archives.gov/federal-register/cfr/ibr-locations.html.
* * * * *
0
5. Revise Sec. 500.22 to read as follows:
Sec. 500.22 Abbreviations.
The following abbreviations and none other may be employed in the
required net quantity declaration:
Inch--in.
Feet or foot--ft.
Fluid--fl.
Liquid--liq.
Ounce--oz.
Gallon--gal.
Pint--pt.
Pound--lb.
Quart--qt.
Square--sq.
Weight--wt.
Yard--yd.
Avoirdupois--avdp.
Cubic--cu.
Note: Periods and plural forms shall be optional. Exponents are
permitted.
PART 502--REGULATIONS UNDER SECTION 5(C) OF THE FAIR PACKAGING AND
LABELING ACT
0
6. The authority citation for part 502 is revised to read as follows:
Authority: 15 U.S.C. 1454, 1455.
Sec. Sec. 502.100, 502.101, and 502.102 [Removed and Reserved]
0
7. Remove and reserve Sec. Sec. 502.100, 500.101, and 502.102.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2015-28918 Filed 11-16-15; 8:45 am]
BILLING CODE 6750-01-P