Announced Actions for October 8, 2004

For Your Information

FTC staff comments on Arkansas state contact lens laws: In response to an inquiry from Arkansas Representative Doug Matayo, Federal Trade Commission staff in the agency’s Office of Policy Planning, Bureau of Consumer Protection, and Bureau of Economics have issued comments concerning whether certain Arkansas regulations on contact lenses are preempted by the new federal Fairness to Contact Lens Consumers Act. FTC staff considered the Act, the FTC’s Contact Lens Rule, and Possible Barriers to E-Commerce: Contact Lenses – an FTC staff report issued in March 2004 – in evaluating Arkansas law.

The FTC staff concluded that two features of the Arkansas law appear to be preempted by federal regulations. First, the Arkansas legislation specifies that contact lens prescriptions should be released to consumers ‘upon request’ and ‘upon payment’ for the eye examination and lens fitting. Federal law requires prescribers, such as optometrists and ophthalmologists, to provide patients with a copy of their contact lens prescription immediately upon completion of a fitting, rather than ‘upon request.’ Federal law also allows a prescriber to require payment prior to prescription release only if the prescriber requires immediate payment where an examination reveals no need for contact lenses or other ophthalmic goods. Second, Arkansas law forbids the sale of contact lenses unless “positive verification” of a consumer’s prescription is made in accordance with state law. The federal law requires contact lens sellers either to obtain a copy of a patient’s prescription or verify the prescription before selling contact lenses, and deems a prescription “verified” if, among other things, a prescriber fails to respond to a seller’s verification request within eight business hours.

The Arkansas legislation also requires that third-party providers of contact lenses, such as mail order, Internet, and other alternative providers, be licensed in Arkansas to sell contact lenses to Arkansas residents. The FTC’s comments argue that such a requirement likely results in higher prices and reduced consumer choice, which could increase the incidence of health problems associated with contact lens use, such as over-wearing. By contrast, federal law permits third-party sellers to sell contact lenses to consumers as long as they have a valid prescription. In its comments, the FTC staff recommends that Arkansas rescind its licensing requirement and, if the state finds it necessary to regulate contact lens sellers beyond existing regulations, it should consider adopting a simple registration requirement instead.

The Commission vote authorizing the staff to file the comments was 5-0.

Commission approval of final consent order: Following a public comment period, the Commission has approved a final consent order in the matter concerning Applied Card Systems, Inc., et al. The Commission vote to approve the final consent order was 5-0. (FTC File No. 032-3040; the staff contact is Jessica D. Gray, FTC Southeast Region, 404-656-1350; see press release dated August 25, 2004.)

Copies of the documents mentioned in this release are available from the FTC's Web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

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