Comment Number: 522418-00448
Received: 6/1/2006 11:44:49 PM
Organization: H&ANaturals
Commenter: Elizabeth Hardy
State: IL
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

I am writing this letter to express my strong opposition to the proposed Business Opportunity Rule R511993. One of the most confusing and burdensome sections of the proposed rule is the 7-day waiting period to enroll new distributors. Most of my clients who sign an applications do so to purchase Shaklee products at a wholesale price. They are solely consumers of Shaklee products. The proposed rule requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. In this day of identity theft, I am uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or consent, to stangers. I believe that this would dissuade new people from signing up as distributors due to their concern about identity theft and privacy. The 10 references could damage the businesses of numerous Shaklee distributors, including me. The 10 reference requirement is also 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 nerest distributors who became distributors within the past 3 years. Each prospective recruit will need a customized disclosure statement and this will result in a delay far longer than 7 calendar days before any potential recruit can sign an application. Many people enter direct selling part-time to earn extra income for a specific goal, such as family vacation or holiday purchases. This long wait which the proposed rule will entail will make their goal unattainable. The proposed rule calls for the release of any information regarding lawsuits that allege misrepresentation, or unfair or deceptive practices over a 10-year period. It doesn't matter if the company was found innocent or not liable. It doesn't 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. 50 year old companies such as Shaklee Corporation and their distributors would be placed at a disadvantage compared to start-up direct selling companies, which may not yet have experienced litigation but which are far more likely to have legal issues surround their opportunities. I have been a Shaklee Distributor for over 20 years. I joined because I loved the company's nutritional, personal care, household products and I wanted to earn some additional income working from home. My daughter and partner depends on this extra income to supplement her budget. The implementation of this rule will seriously affect her income. While I appreciate the work of the FTC to protect consumers, I believe this proposed new rule has many unintended consequences for direct sellers and that there are less burdensome alternatives available to the agency to achieve its goals. Thank you for listening to my comments. Sincerely, Elizabeth A. Hardy