|Received:||6/10/2006 10:58:46 PM|
|Organization:||Young Living Essential Oils|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
|Attachment:||522418-01738.pdf Download Adobe Reader|
Comments:I became involved with Young Living because I felt the products were exceptional. Later on, I became further involved so that I could earn additional income. Through Young Living, I have developed leadership skills and cultivated many meaningful relationships. My family and I enjoy the health benefits of using these products daily and are thrilled to be part of Young Living. We have come to rely on the income from my direct selling business. The future of my family is dependent on the stability of the direct selling industry. Seven-Day Waiting Period One of the most confusing sections of the proposed rule is the seven-day waiting period to enroll new distributors. Young Living’s Starter Kits cost only $50.00, and each kit contains products, samples, training materials, etc., worth far more than the sale price. No commissions or other compensation is paid on these kits, and the company just covers its production costs. Having this waiting period gives the impression that there might be something wrong with the company or the compensation plan. It would also be quite burdensome for me to keep such detailed records of when I spoke with every single person about Young Living, and it would create lots of unnecessary paperwork to have to send these reports to my company headquarters. Litigation Information The proposed rule also calls for the release of any information regarding lawsuits involving misrepresentation or unfair or deceptive practices, regardless of whether the company was found innocent or not. Today, anyone or any company can be sued for almost anything. It does not make sense to me that I would have to disclose these lawsuits unless Young Living were found guilty. Otherwise, this company and I are put at an unfair disadvantage even though the company has done nothing wrong. To release this information would be misleading to prospective distributors. References The proposed rule requires the disclosure of a minimum of ten prior purchasers nearest to the prospective purchaser. I am glad to provide references, but, in this day of identity theft, I am very uncomfortable giving out the personal information of individuals, particularly without their approval, to strangers. I also think the following sentence required by the proposed rule will prevent many people from wanting to sign up as a distributor: “If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers.” People are very concerned about their privacy and identity theft. Young Living simply does not sell “business opportunities” in this fashion. Cancellation Some people decide to stop purchasing from Young Living after a period of time or purchase very sporadically and lose their distributor status. As with any large business, this amounts to tens of thousands of individual customers who no longer order from them each year. Maintaining such lists and providing them to every potential distributor and wholesale customer would be an unrealistic burden. Exemption In 1979, to justify the reasonable $500 exemption, the FTC wisely said: “When the required investment to purchase a business opportunity is comparatively small, prospective purchasers face a relatively small financial risk.” This is still true today. I believe that the proposed application of this rule to my business constitutes an unjustified overreaching. Please reinstate at least a $500 exemption. I appreciate the work that the FTC does to protect consumers, yet I believe this proposed new rule has many unintended consequences, and there are less burdensome alternatives available to achieving your goals. Thank you for your time in considering my comments.