| Comment Number: | 522418-00170 |
| Received: | 6/1/2006 8:04:58 AM |
| Organization: | Independent Distributor with Shaklee Corporation |
| Commenter: | Allyn Richied |
| State: | OH |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Dear Madam aor Sir: I am writing this letter to express my strong oppostion to the proposed Business Opportunity rule R511993. I understand that it is the responsibility of the Federal Trade Commission to protect the public from "undair and deceptive acts or practices," but the rule as proposed would make it very difficult for lme to operate my business as a Shaklee Independent Dirstributor. One of the most confusing and burdensome sections of the proposed urle is the seven-day waiting peroid to enroll new distributors. Most of the poeple who sign an application to become distributors do so to pruchase Shaklee products at a wholesale price. In other words, they are solely consumers of the products. If they later wish to build a business, all they must do is supply Shaklee Corporation with their Social Security Number or Tax Identifcation Number. There is no additional kit, fee or application required. The Shaklee Member Kit costs only $19.95. This is ar less thean many, if not most, consumer purchases, from TV's to all manner of household applicances, none of which require a seven-day waiting period. In addition, the seven-day period is unnecessary in that Shaklee Corporation already has a 90% buyback policy for porducts, including the Member Kit, purchased by a distributor within the last two years. The proposed urle requires the disclosure of a nimimum of 10 prior purchasers nearest to the prospective purchaser. There are many problems with this proposed requirement. In this day of identity theft, I am VERY uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or consent to strangers. I understand that those who sign up after the rule takes effect would be told in writing "If you buy a business opportunity from the seller, your contact information can be disclosed int he future to other buyers." I believe that this would dissuade new people from signing up as distributors as they are concerned not only about identity theft, but also about THEIR PRIVACY, as I would hae been.People today are understandably reluctant to share their personal information with individuals they may never have met. Providing the ten references also could damage the businesses of numerous Shaklee Distributors. Lower ranking distributors often are already involved in more than one direct sselling company. Providing a list to a potential recruit, who may already be a distributor for a competing direct selling company, may be an invitation to solicit existing distributors for another opportunity. The ten reference requirement also is an administrative burden. In order to obtain the list of 10 prior purchasers, I will need to provide Shaklee Corporation with the prospective distributor's address, and then wait to receive the list of the 10 nearest distributors who became distributors within the past three years. Each prospective recruit will need a customized disclosure statement. This will result in a delay far longer than seven calendar days before any portential recruit can sign an application. In view of the fact that many people enter direct selling part-time to earn extra income for a specific goal, such as holiday pruchases or a family vacation, the long wait which the proposed rule will entail may make the goal impossible. The prosposed rule calls for the release of any information regarding lawsuits that alleg misrepresentation, or unfair or deceptive practices over a ten-year period. It does not matter if the company was found innocent or not liable. What happened to NOT GUILTY in our country! Today, almost all business lawsuits contain claims of misrepresentation or unfair competition. It does not make sense to me that I would have to disclose these lawsuits unless Shaklee Corporation, or its officers, directors or sales department employees, had been found guilty or liable. Otherwise, fifty-year old companies such as Shaklee Corporation and their