| Comment Number: | 522418-00056 |
| Received: | 5/19/2006 10:20:24 AM |
| Organization: | Arbonne International |
| Commenter: | Lisa LaLande |
| State: | MI |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
I am writing in response to the proposed New Business Opportunity Rule R511993, if not modified, it will be an significant burden to the network marketing industry. This new rule represents a burden to the free market trade that we have come to enjoy as Americans. The rule would require a seven day waiting period to enroll new distributors. In essence, we ould have to sell a person twice on the same business-even if the start up fee is a mere $29. This waiting period is an excessive burden to any company and distributor who would be required to document and follow-up on the process and an impediment to new business development. This rule requires that any earnings claim statement made by the distributor or company to a prospect, whether written or oral, general or specific, be validated with a detailed "Earnings Claims Statement Required By Law." Additionally, the distributor would be required to provide written substantiation of any earnings claim made upon request. I support the disclosure of an average earnings statement because it is good business practice to establish realistic expectations. I do however, oppose being forced to provide written substantiation because it is an excessive burden considering the investment of money to enter into the business is nominal. The rule also calls for the release of any information regarding prior litigation and civil or criminal legal actions involving misrepresentation, or unfair or deceptive practices, even if you were found innocent. In our lawsuit happy culture, anyone can be sued for anything almost with impunity. You would have to disclose this information and expalin it to a new business associate which is patently unfair. I ask, are these standards held elsewhere in our system of free enterprise? This is appropriate only if the party is found guilty. Lastly, the rule requires the disclosure of a minimum of 10 purchasers closest to you. This is a burden for small businesses and as a requirement is a violation of personal confidentiality. Requiring the release of this information can threaten the business relationship of the references who may be involved in other companies or businesses. In addition, it subjects these references to cross marketing by competitors. Contact info for purchasers should be available upon request, and that this information should be published on company materials, and due to Internet availability geographic proximity is unnecessary. Network marketing is one of the few remaining opportunities for average people to leverage their time and resources to earn additional income or create a new career. Network marketing is coming of age in this millenium as evidenced by many being traded publicly on Wall Street. Many top authors, and economists such as Robert Kiyosaki and Paul Zane Pilzer have endorsed this form of business enterprise. There are 13 million Americans involved in network marketing today. Network marketing contributes to the American economy. Sales of Network marketing products and services are estimated at more than 29 billion in 2003. This proposed new rule exceeds what is necessary and needs significant modification if it is going to achieve it's intended purpose. People should have the right to make their own informed decisions without excessive government intrusion. Please revise this rule to reflect appropriate, and less excessive protections for prospective distributors and customers while still protecting our right to free enterprise as Americans. Sincerely, Lisa LaLande