FTC Seeks Comments on Proposed Regulation to Limit Marketing Solicitations from Affiliates

Proposal Would Require that Consumers Be Given Opportunity to Opt Out

For Release

 

The Federal Trade Commission is seeking public comment on proposed regulations that would give consumers the chance to “opt out” before a company uses certain information provided by an affiliate to market its products or services to the consumer.

The proposed rulemaking would implement the affiliate marketing provisions in section 214 of the Fair and Accurate Credit Transactions Act (FACTA), which adds a new section 624 to the Fair Credit Reporting Act (FCRA). FACTA also requires the Federal banking agencies, the National Credit Union Administration, and the Securities and Exchange Commission to make rules implementing these provisions, and directs the agencies to coordinate with one another and to adopt comparable and consistent regulations. The proposal would generally prohibit a company from using certain information received from an affiliate to market products or services to a consumer unless the consumer first has been given notice and an opportunity to opt out of receiving such solicitations. If a company has a pre-existing business relationship with the consumer, it would not be subject to this proposed regulation. Nothing in the new affiliate marketing opt-out supercedes or replaces the affiliate sharing opt-out contained in section 603 of the FCRA, although there is some overlap between the two opt-out requirements.

After being published in the Federal Register, comments can be filed electronically at http://www.regulations.gov. Commentors should select “Federal Trade Commission” at “Search for Open Regulations,” locate the summary of this notice, click on “Submit a Comment on this Regulation,” and complete the form. Comments must be received by July 20, 2004.

Written comments should refer to “FACT Act Affiliate Marketing Rule, Matter No. R411006” on both the envelope and the text, and should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H-159 (Annex Q), 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Comments containing confidential material must be filed in paper form. Any comment filed in paper form should be sent by courier or overnight service, because U.S. postal mail is subject to delay due to heightened security precautions. Comments on any proposed filing, recordkeeping, or disclosure requirements that are subject to paperwork burden review under the Paperwork Reduction Act should additionally be submitted to: Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Federal Trade Commission, and should be submitted via fax at 202-395-6974, because U.S. postal mail at the Office of Management and Budget is subject to delay due to heightened security precautions. Such comments should also be mailed to the following address: Federal Trade Commission, Office of the Secretary, Room H-159 (Annex Q) 600 Pennsylvania Avenue, N.W., Washington, DC 20580.

The Commission vote approving publication of the Federal Register notice was 5-0.

Copies of the Federal Register notice are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad

(FTC File No. R411006)
(FACTA Affiliate Opt-Out)

Contact Information

Media Contact:
Jen Schwartzman
Office of Public Affairs
202-326-2674
Staff Contact:
Toby Milgrom Levin or Loretta Garrison
Division of Financial Practices
202-326-3224