|Received:||6/11/2006 9:42:47 AM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:There are specific sections in the proposed rule that will make it very difficult, if not impossible, for me to sell Young Living's products. Like myself, the vast majority of Young Living distributors promote the purchase of product rather than any business opportunity. 7-Day Waiting Period Very confusing, the proposed rule is the 7-day waiting period to enroll new distributors. Starter Kits cost $50.00, and contains products, samples, training materials, etc., purchasers become distributor and granted special discounted pricing. No commissions and the company just covers its costs. Young Living fully refunds this cost if they decides to send it back. Requiring a 7-day waiting period before a distributor is allowed to even place an order would be destructive to the businesses of thousands of distributors who are building a business around Young Living's products. It would be quite burdensome 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 send these reports.. Litigation Information 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. 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: 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, particularly without their approval. People are very concerned about their privacy and identity theft. Giving away this information could damage the business relationship of the references who may be involved in other companies or businesses, including those of competitors. In order to get the list, I would need to send the address of the prospective purchaser to Young Living headquarters and then wait to receive the list. 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.” Further, Young Living simply does not sell “business opportunities” in this fashion. Cancellation people decide to stop purchasing or purchase very sporadically and lose their distributor status. Maintaining such lists and providing them to every potential distributor and wholesale customer would be an unrealistic burden. Exemption For about 25 years the FTC's Franchise Rule included only those opportunities that required a buyer to make a payment of at least $500 within the first 6 months of operation. Any buyer making payments of less than $500 within the first 6 months was exempt from further requirements. The April 12, 2006, proposed rule completely eliminates this $500 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. This exemption is necessary because without such an exemption, the proposed rule places an unreasonable burden on tens of thousands of Young Living distributors, like myself, and on millions of direct selling and network marketing distributors throughout the US. This would be devastating to the growth of my business and that of millions of Americans. I believe that the proposed application of this rule to my business constitutes an unjustified overreaching. Please reinstate at least a $500 exemption.