Business Opportunity Rule #522418-11990

Submission Number:
Thomas Hockel
Initiative Name:
Business Opportunity Rule
Pursuant to the notice and request for comments to the Federal Trade Commission's proposed Business Opportunity Rule (the "Proposed Rule") as published in 71 F.R. 19054, I am submitting the following comments at the request and on behalf of my interested clients. First, my clients feel the goal that the FTC seeks to accomplish by imposing a seven-day waiting period-that is, allowing the purchaser the opportunity to review the seller's disclosure information and conduct a due diligence review of the seller (see comments, 71 F.R. @19067)--could just as effectively be accomplished with a requirement of an unfettered post purchase right to cancel. Additionally, my clients agree with the FTC's observation that a seven calendar day waiting period may in fact be too long. (See comments, 71 F.R. @19067) A three-day right-to-cancel period along the lines of the FTC's "Rule Concerning Cooling-Off Period For Sales Made At Homes Or At Certain Other Locations" (16 CFR 429) would seem to be a more reasonable alternative. Therefore, my clients suggest that the FTC adopt a post purchase three-day right to cancel. Second, although the FTC includes multiple references to the Illinois Business Opportunity Sales Law of 1995 in its comments, none of the exemptions contained in the Illinois law are included in the FTC's proposed rule. My clients believe the exemptions set forth in the Illinois law are a recognition that businesses which meet certain qualifications have otherwise demonstrated that there is no need to subject them to the requirements of the Proposed Rule. Consequently, my clients recommend that the FTC adopt the exemptions set forth in the Illinois Law. We appreciate your consideration of these concerns. Very truly yours, Thomas K. Hockel, Esq. Kelly, Herlihy & Klein, LLP