81 FR 63664 - Disclosure of Written Consumer Product Warranty Terms and Conditions; Pre-Sale Availability of Written Warranty Terms

FEDERAL TRADE COMMISSION

Federal Register Volume 81, Issue 179 (September 15, 2016)

Page Range		63664-63670
FR Document		2016-21853

In this document, the Federal Trade Commission (FTC or Commission) adopts amendments to the rules on Disclosure of Written Consumer Product Warranty Terms and Conditions (Disclosure Rule) and Pre-Sale Availability of Written Warranty Terms (Pre-Sale Availability Rule) to give effect to the E-Warranty Act, which allows for the use of Internet Web sites to disseminate warranty terms to consumers in some circumstances.

Federal Register, Volume 81 Issue 179 (Thursday, September 15, 2016)

[Federal Register Volume 81, Number 179 (Thursday, September 15, 2016)]
[Rules and Regulations]
[Pages 63664-63670]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-21853]

[[Page 63663]]

Vol. 81

Thursday,

No. 179

September 15, 2016

Part IV

Federal Trade Commission

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16 CFR Parts 701 and 702

Disclosure of Written Consumer Product Warranty Terms and Conditions;
Pre-Sale Availability of Written Warranty Terms; Final Rule

Federal Register / Vol. 81 , No. 179 / Thursday, September 15, 2016 /
Rules and Regulations

[[Page 63664]]

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FEDERAL TRADE COMMISSION

16 CFR Parts 701 and 702

RIN 3084-AB24 and AB25

Disclosure of Written Consumer Product Warranty Terms and
Conditions; Pre-Sale Availability of Written Warranty Terms

ACTION: Final rule.

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SUMMARY: In this document, the Federal Trade Commission (FTC or
Commission) adopts amendments to the rules on Disclosure of Written
Consumer Product Warranty Terms and Conditions (Disclosure Rule) and
Pre-Sale Availability of Written Warranty Terms (Pre-Sale Availability
Rule) to give effect to the E-Warranty Act, which allows for the use of
Internet Web sites to disseminate warranty terms to consumers in some
circumstances.

DATES: Effective on October 17, 2016.

ADDRESSES: This document is available on the Internet at the
Commission's Web site at www.ftc.gov. The complete record of this
proceeding, including the final amendments to the Disclosure Rule and
the Pre-Sale Availability Rule and the Statement of Basis and Purpose,
is available at www.ftc.gov.

FOR FURTHER INFORMATION CONTACT: Gary Ivens, (202) 326-2330, Attorney,
Division of Marketing Practices, Federal Trade Commission, 600
Pennsylvania Ave. NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION: This document states the basis and purpose
for the Commission's decision to adopt amendments to the Disclosure
Rule and the Pre-Sale Availability Rule that were proposed and
published for public comment in the Federal Register on May 24,
2016.\1\ After careful review and consideration of the entire record on
the issues presented in this rulemaking proceeding, including seven
public comments submitted by a variety of interested parties,\2\ the
Commission has decided to adopt, with some modifications, the proposed
amendments to the Disclosure Rule and the Pre-Sale Availability Rule
intended to implement the E-Warranty Act and effectuate its purpose.
Beginning on October 17, 2016, warrantors and sellers will be required
to comply with the amended Disclosure Rule and the amended Pre-Sale
Availability Rule.
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\1\ 81 FR 32680 (May 24, 2016).
\2\ Comments are available at https://www.ftc.gov/policy/public-comments/initiative-652.
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Background

I. The Magnuson-Moss Warranty Act and the E-Warranty Act

The Magnuson-Moss Warranty Act (MMWA) authorizes the Commission to
prescribe rules requiring disclosure of warranty terms and requiring
that the terms of any written warranty on a consumer product be made
available to the prospective purchaser prior to the sale of the
product.\3\ In 1975, the Commission issued both the Disclosure Rule,
which establishes disclosure requirements for written warranties, and
the Pre-Sale Availability Rule, which includes requirements for sellers
and warrantors to make the text of any warranty on a consumer product
available to the consumer prior to sale. Among other things, the Pre-
Sale Availability Rule requires most sellers to make warranties readily
available either by: (1) Displaying the warranty document in close
proximity to the product or (2) furnishing the warranty document on
request and posting signs in prominent locations advising consumers
that warranties are available. The Pre-Sale Availability Rule requires
warrantors to provide materials to enable sellers to comply with the
Rule's requirements. The Rule also sets out how sellers should make
warranty information available pre-sale if selling the product at
retail locations, through catalogs, mail order, or door-to-door sales.
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\3\ 15 U.S.C. 2302.
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The E-Warranty Act \4\ (E-Warranty or the Act) amends the MMWA to
allow, under certain circumstances, the posting of warranties on
warrantors' Internet Web sites as an alternative method of complying
with the Pre-Sale Availability Rule, and to permit sellers to make
warranty terms available to consumers pre-sale via electronic means
where the warrantor has chosen the online method. E-Warranty charges
the Commission with promulgating consistent changes to the Disclosure
Rule and the Pre-Sale Availability Rule within one year of the Act's
passage.\5\
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\4\ E-Warranty Act, Public Law 114-51 (Sept. 24, 2015).
\5\ Under the E-Warranty Act, the Commission must issue the
final amended rules by September 24, 2016.
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II. Amending the Disclosure Rule and the Pre-Sale Availability Rule in
Accordance With E-Warranty

A. The Disclosure Rule

The Disclosure Rule \6\ establishes disclosure requirements for
written warranties on consumer products that cost more than $15.00.\7\
In 1975, the Commission issued the Disclosure Rule as authorized by
Congress in the MMWA.\8\
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\6\ 16 CFR part 701.
\7\ 40 FR 60171-60172 (Dec. 31, 1975)
\8\ 15 U.S.C. 2302.
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The Disclosure Rule also specifies the aspects of warranty coverage
that must be disclosed in written warranties, as well as the exact
language that must be used for certain disclosures with respect to
state law regarding the duration of implied warranties and the
availability of consequential or incidental damages. Under the
Disclosure Rule, warranty information must be disclosed in simple,
easily understandable, and concise language in a single document.
Similarly, the warrantor must disclose any limitations on the duration
of implied warranties ``on the face of the warranty,'' as mandated by
MMWA.\9\ In promulgating the Disclosure Rule, the Commission determined
that certain material facts about product warranties must be disclosed
because the failure to do so would be deceptive or misleading.
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\9\ See 15 U.S.C. 2308(b).
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To comply with E-Warranty, the Commission revises the Disclosure
Rule to specify that, for a warranty posted on an Internet Web site or
displayed electronically, disclosures statutorily mandated to appear
``on the face of the warranty'' must be placed in close proximity to
the location where the text of the warranty terms begins.

B. The Pre-Sale Availability Rule

The Pre-Sale Availability Rule \10\ details the methods by which
warrantors and sellers must provide warranty terms to consumers prior
to sale of the warranted item. The Commission issued the Pre-Sale
Availability Rule in 1975 in response to a mandate from Congress as set
forth in the MMWA.
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\10\ 16 CFR part 702.
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In accordance with the mandate in E-Warranty, the Commission
revises the Pre-Sale Availability Rule to allow warrantors to post
warranty terms on Internet Web sites if they also provide a non-
Internet based method for consumers to obtain the warranty terms and
satisfy certain other conditions, and to allow certain sellers to
display warranty terms pre-sale in an electronic format if the
warrantor has used the online method of disseminating warranty terms.
As discussed more fully below, these rule revisions are required by
E-Warranty.

[[Page 63665]]

III. The Commission's Rule Changes and Analysis of Comments

The existing version of the Pre-Sale Availability Rule requires
sellers to provide warranty terms pre-sale to consumers and allows them
to choose among a variety of methods for doing so, including displaying
the warranty terms in close proximity to the warranted products,
furnishing them upon request prior to sale and posting prominent signs
to let customers know that warranties can be examined upon request,
printing them in a catalog in close conjunction to the warranted
product, or having them available for consumers' review in a door-to-
door sales presentation. The amendments will allow sellers the
additional option of using an electronic method to make warranty terms
available to consumers at the point of sale for warranted products
where the warrantor has chosen the online method of disseminating the
warranty terms.
Warrantors currently must provide sellers the warranty materials
sellers need to meet their requirements under the Pre-Sale Availability
Rule, such as providing copies of the warranty, providing warranty
stickers, tags, signs, or posters, or printing the warranty on the
product's packaging. The amendments do not alter the duties of
warrantors who do not choose to employ an online method to supply
warranty terms. E-Warranty provides that warrantors who choose the
online method of disseminating warranty terms must provide consumers
the address of the Internet Web site where the specific product's
warranty terms can be reviewed and also supply a non-Internet method,
such as a phone number or mailing address, for consumers to request the
warranty terms. Under the amendments, if a consumer or seller \11\
makes such a request, the warrantor must provide the warranty terms
promptly and free of charge.
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\11\ The revised rule gives sellers the option of requesting the
warranty terms free of charge from the warrantor because not all
sellers have the ability to provide warranty terms pre-sale using
electronic means when the warrantor has chosen the online method to
supply warranty terms. For example, a small seller may not have
Internet access or electronic devices to download and display
warranty terms for consumers' review at the point of sale. Those
sellers' duties to have warranty terms available pre-sale, however,
have not changed under E-Warranty. The Commission believes that
requiring warrantors to supply sellers with a hard copy of warranty
terms upon request, in order to allow sellers to make them available
for consumers' review at the point of sale, effectuates Congress's
desire to ensure the continued availability of pre-sale warranty
terms.
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The first rule revision alters Sec. 701.1 to add a definition of
the term ``manufacturer'' at Sec. 701.1(g) (defining manufacturer as
``any person engaged in the business of making a consumer product''),
add that term in the definition of ``warrantor,'' and re-letter the
paragraphs in Sec. 701.1 to account for the additional definition. The
Commission makes these revisions in light of E-Warranty's use of the
term ``manufacturer.'' \12\
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\12\ The Retail Industry Leaders Association (RILA) suggests
adding the term ``manufacturer'' to the definition of ``warrantor''
in Sec. 701.1, to match the proposed revised definition of
``warrantor'' in Sec. 702.1. Comment of RILA (available at https://www.ftc.gov/policy/public-comments/2016/06/17/comment-00005) at 2.
The Commission proposed this revision in the original NPRM, as noted
in the description of the Commission's Proposed Rule Changes. See 81
FR at 32681. However, a scrivener's error led to the deletion of the
related rule text in the amendatory instructions.
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The next revision adds a new Sec. 701.1(j)(3) to specify that, in
conjunction with warranty terms posted on an Internet Web site or
displayed electronically, the phrase ``on the face'' means in close
proximity to the location where the warranty terms begin. Although the
Disclosure Rule does not explicitly mention online commerce, it applies
to the sale of warranted consumer products online.\13\ Commission staff
recently updated the .Com Disclosures to provide additional guidance on
disclosure obligations in the online context. As stated in the updated
.Com Disclosures, warranties disseminated online are no different from
paper versions and the same rules apply.\14\
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\13\ One commenter suggests that the Commission also consider
amending Sec. 701.3(a) to define the term ``document'' or ``single
document'' to clarify how a warrantor can provide required
information electronically in a ``single document'' pursuant to that
paragraph. See Comment of the National Automobile Dealers
Association (NADA) (available at https://www.ftc.gov/policy/public-comments/2016/06/17/comment-00007) at 2. The Commission believes
that these terms have sufficiently understood common meanings and
declines to make the suggested amendment.
\14\ See FTC, .Com Disclosures: How to Make Effective
Disclosures in Digital Advertising (2013), at 3, fn.7, available at
https://ftc.gov/os/2013/03/130312dotcomdisclosures.pdf. The RILA
comment at 2 asks the Commission to clarify whether and how
Internet-only or omni-channel retailers have to comply with the Pre-
Sale Availability Rule. These sellers' obligations remain the same
under E-Warranty--they must make the warranty terms available to
consumers pre-sale. The requirement to make warranties available at
the point of purchase can be accomplished easily with respect to
online sales by, for example, using a clearly-labeled hyperlink, in
close proximity to the description of the warranted product, such as
``get warranty information here'' to lead to the full text of the
warranty, and presenting the warranty in a way that it can be
preserved, either by downloading or printing, so consumers can refer
to it after purchase. Id. However, sellers at brick-and-mortar
locations could not comply with the seller's Pre-Sale Availability
Rule obligations simply by referring the consumer to a Web site
where the warranty could be found, as this would conflict with
Congress's mandate that the online method not supplant the seller's
duty to provide warranty terms at the point of sale.
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The next revision is to Sec. 702.1(d) to include the manufacturer
in the definition of ``warrantor.'' The Commission makes this revision
to comport with E-Warranty's use of the term ``manufacturer.'' The next
revision adds a new Sec. 702.1(g) to define a ``manufacturer,'' in
accordance with the addition of the term ``manufacturer'' in Sec.
701.1(g), as ``any person engaged in the business of making a consumer
product.''
The revisions to Sec. 702.3(a) allow sellers to provide warranty
terms pre-sale through electronic means if the warrantor of the product
has chosen the online method.\15\ If a seller uses an electronic means
of displaying the warranty terms, that seller must still make the
warranty text readily available for consumers' examination prior to
sale. The changes to Sec. 702.3(b)(1)(i) will remove superfluous
instances of the term ``and/or'' and ``and'' in that paragraph, as the
prefatory language already notes that the warrantor must use one or
more of the methods described in that paragraph to provide sellers with
the prescribed warranty materials.
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\15\ NADA asks whether a dealer may provide a physical copy of
the manufacturer's warranty upon request, even if the manufacturer
has elected the online method. See NADA comment at 3. If the
warrantor has elected the online method, the seller can choose
between providing the warranty terms through electronic means or
through other means (such as furnishing a hard copy).
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The next revision adds a new Sec. 702.3(b)(2) to reflect that, as
an alternative method of compliance with the Pre-Sale Availability
Rule, a warrantor may refer consumers to an accessible online copy of
the warranty by providing to the consumer the Internet address where
the specific product's warranty has been posted in a clear and
conspicuous manner. To employ this option, the warrantor, among other
duties, must supply in the product manual, or on the product or product
packaging, the Internet address where the consumer can review and
obtain the specific product's warranty terms, as well as the phone
number, postal mailing address, or other reasonable non-Internet based
means for the consumer or seller to request a free copy of the warranty
terms.
Revised Sec. 702.3(b)(2)(iv) requires any warrantor utilizing the
online method to provide sufficient information with the consumer
product or on the Internet Web site so that the consumer can readily
locate the specific product's warranty terms. The Commission believes
that this requirement comports

[[Page 63666]]

with Congress's directive that online warranties be available to
consumers ``in a clear and conspicuous manner.'' \16\ Similarly, if a
consumer or seller requests via phone, mail, or other reasonable non-
Internet-based means, that the warrantor provide a hard copy of the
warranty, revised Sec. 702.3(b)(2)(ii) requires the warrantor to
provide it promptly and free of charge, which comports with existing
pre-sale requirements for catalog and mail order sales.\17\
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\16\ See 15 U.S.C. 2302(b)(4)(A)(i).
\17\ NADA asks how the warrantor's duty under Sec.
702.3(b)(2)(ii) to provide a hard copy of the warranty upon request
interacts with the seller's duty under Sec. 702.3(a)(2) to furnish
the warranty terms upon request prior to sale. See NADA comment at
3-4. The seller's duty to furnish warranty terms for the consumer to
review pre-sale in Sec. 702.3(a)(2) requires only that the seller
make the warranty terms available for review at the place of sale;
the warrantor's duty to provide a hard copy of the warranty upon
request (where the warrantor has elected the online method for
providing warranty terms) ensures that consumers without the ability
to obtain warranty terms from a Web site have the ability to secure
a hard copy of the warranty terms. The warrantor's duty under Sec.
702.3(b)(2)(ii) stems from E-Warranty's requirement that consumers
have a ``reasonable non-Internet based means of contacting the
manufacturer to obtain and review'' warranty terms. 15 U.S.C.
2302(b)(4)(A)(ii)(II) (emphasis added). The Commission interprets
this statutory language to mean that, if a warrantor chooses the
online method and a consumer uses the non-Internet based means to
contact the warrantor and request a copy of the warranty, the
warrantor must provide the warranty terms to the consumer. This new
requirement under the E-Warranty Act is independent of the existing
requirement under the MMWA and current Sec. 702.3(a)(2) that
sellers must furnish the warranty terms upon request prior to sale.
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The next revision alters Sec. 702.3(c)(2)(i)(B) to reflect that a
mail-order or catalog seller must provide the address of the Internet
Web site of the warrantor where the warranty terms can be reviewed (if
such Internet Web site exists), as well as either a phone number or
address that the consumer can use to request a free copy of the
warranty, and notes that the seller may provide the copy electronically
if the product's warrantor has used the online method.
Finally, the next revision alters Sec. 702.3(d)(2) to reflect that
a door-to-door seller may supply the warranty terms for the consumer's
pre-sale review through an electronic option if the product's warrantor
has employed the online method.
The Commission received seven comments in response to the Notice of
Proposed Rulemaking. In response to one comment, the Commission makes
one change in the final version of the Pre-Sale Availability Rule, as
discussed below.
Comments generally supported the Commission's proposals.\18\ One
commenter requests the Commission to clarify whether MMWA applies to
all warranties required by other federal laws.\19\ The Commission notes
that Sec. 700.1(a) of the Interpretations of Magnuson-Moss Warranty
Act defines the scope of the MMWA and states it ``applies to written
warranties on tangible personal property which is normally used for
personal, family, or household purposes.'' \20\ The MMWA covers
warranties required by other federal laws only to the extent such
warranties fall within the scope of Sec. 700.1(a).
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\18\ See comments of Linda Gibson (available at https://www.ftc.gov/policy/public-comments/2016/05/19/comment-00001),
Catherine Corn (available at https://www.ftc.gov/policy/public-comments/2016/06/15/comment-00002), Alliance of Automobile
Manufacturers (available at https://www.ftc.gov/policy/public-comments/2016/06/17/comment-00003), RILA.
\19\ Comment of Erin Ashcroft (available at https://www.ftc.gov/policy/public-comments/2016/06/17/comment-00006). See also 42 U.S.C.
7541 and 40 CFR 1054.120.
\20\ See 16 CFR 700.1(a).
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Another commenter suggests that the Commission provide guidance as
to the meaning of the term ``accessible digital format,'' and urges the
Commission to be reasonable in interpreting how warranty terms remain
accessible on Web sites, how hard copies of warranties are to be
provided, and the means by which the addresses of warranty Web sites
may be accessed.\21\ The Commission agrees that providing an electronic
warranty in an ``accessible digital format'' generally means the
electronic warranty should be readily available to consumers on the
warrantor's Web site. Given the speed of technological innovation, the
Commission believes defining the term might impose unnecessary
limitations on the ability of companies to comply with E-Warranty using
future digital innovations.\22\ The commenter's remaining comments
about the need for practical and flexible interpretations of the Rule
raise issues that the Commission will consider when determining whether
to bring an enforcement action for potential violations of E-Warranty
and the related rules.
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\21\ Comment of the Consumer Technology Association (CTA)
(available at https://www.ftc.gov/policy/public-comments/2016/06/17/comment-00004).
\22\ The CTA comment at 3-4 also suggests that the Commission
permit display, in addition to the URL of the warranty terms, of
machine-readable symbols, such as bar codes or QR codes, for
consumers to access and review warranty terms. The Commission agrees
that inclusion of these symbols with the URL could assist consumers
seeking to access and review warranty terms, but declines, at this
time, to permit such additional methods to replace the display of
the URL containing the warranty terms for warrantors relying on the
option set forth in Sec. 702.3(b)(2). Warrantors, however, may
display such symbols in addition to displaying the URL containing
the warranty terms.
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Two commenters urge the Commission to adopt a rule that would allow
sellers to refer consumers to an Internet Web site where the warrantor
has posted warranty terms to satisfy sellers' obligations under the
Pre-Sale Availability Rule.\23\ The Commission declines to do so.
Congress's intention in enacting E-Warranty was not to disturb
prospective purchasers' ability to obtain the full warranty terms at
the point of sale, as envisioned by the Pre-Sale Availability Rule.\24\
While consumers with electronic devices and Internet connectivity may
be able to review warranty terms at the point of sale by visiting the
Web site that contains the warranty terms, not all consumers have such
devices and Internet connectivity.
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\23\ RILA comment at 2; NADA comment at 3 (questioning whether a
seller could comply by referring a prospective buyer to the warranty
Web site).
\24\ See, e.g., H. Rpt. 114-243 (Sept. 8, 2015) at 2-3 (``H.R.
3154 would require the FTC to update the warranty rules to allow
manufacturers to fulfill their obligations by making warranty
information available online or through other electronic means while
ensuring that consumers[] and prospective consumers remain able to
obtain copies of warranties at the point of sale . . . .'').
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NADA comments that use of the past tense in the phrase ``specific
product purchased by the consumer'' in Sec. 702.3(b)(2)(iv) may cause
confusion in the Pre-Sale Availability Rule,\25\ because consumers
could choose to review these warranty terms both before and after a
sale. To remove any confusion, the Commission will alter the language
for

[[Page 63667]]

the final rule, replacing the phrase ``specific product purchased by
the consumer'' with ``specific warranted product.''
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\25\ NADA comment at 2. The NADA comment raises several other
issues. For example, NADA asks whether a seller can fulfill its
obligation under Sec. 702.3(a) by merely supplying the prospective
purchaser with the URL of the warranty terms' Web site (e.g., a URL
printed on a sign displayed in close proximity to the vehicle or
printed in the owner's manual). See NADA comment at 3-4. Such an
approach would be inconsistent with Congress's intent in passing E-
Warranty. As noted in the foregoing footnote and accompanying text,
Congress's passage of E-Warranty did not alter the requirement that
warranty terms be available at the point of sale. If the warrantor
has opted to use the online method and the seller cannot or chooses
not to use an electronic method to display the warranty text upon
consumers' request, the seller can ask the warrantor to supply a
hard copy of the warranty terms to the seller, as provided in Sec.
702.3(b)(2)(ii). NADA also asks for guidance on how dealers who
offer their own warranties can refer to warranty information in the
Buyers Guide that must accompany every used vehicle pursuant to the
Used Car Rule. The Commission notes that there is no conflict
between the language in the Buyers Guide, which requires the dealer
merely to inform a prospective purchaser whether the automobile for
sale has a warranty, and the obligations of dealers who offer their
own warranties and choose the online method in Sec. 702.3(b)(2).
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IV. Regulatory Flexibility Act

The Regulatory Flexibility Act \26\ (RFA) requires each agency
either to provide an Initial Regulatory Flexibility Analysis (IRFA)
\27\ with a proposed rule and a Final Regulatory Flexibility Analysis
(FRFA) \28\ with the final rule, or certify that the proposed rule will
not have a significant economic impact on a substantial number of small
entities.\29\ The FTC does not expect that the rule revisions
necessitated by E-Warranty will have a significant economic impact on
small sellers and warrantors. As discussed above, the revisions will
relieve those warrantors who choose the online method from providing
warranty materials to certain sellers. Affected sellers, however,
should be able easily to obtain the warranties and provide them to
consumers for review at the point of sale, either by obtaining the
warranties from the warrantor's Web site or by requesting a hard copy
from the warrantor. Also, the amendments allow sellers of goods whose
warrantors have employed the online method the ability to provide pre-
sale warranty terms electronically. Thus, under the revised Rule, a
small seller that is in compliance with current law would need to take
only minimal additional action to remain compliant.
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\26\ 5 U.S.C. 601-612.
\27\ 5 U.S.C. 603.
\28\ 5 U.S.C. 604.
\29\ 5 U.S.C. 605.
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The small warrantor that does not choose the online method to
supply warranty terms can remain compliant simply by continuing with
its existing practices. If a small warrantor has previously been
including the entire warranty with the warranted product and supplying
warranty materials so that sellers can meet Pre-Sale Availability Rule
obligations, but instead elects the online method under the amendments,
the small warrantor will have a smaller overall compliance burden
because it will be able to provide the warranty terms solely on an
Internet Web site. That small warrantor, however, will likely incur
some costs to establish a phone number, address, or other non-Internet
based method that consumers and sellers can use to request a free hard
copy of warranty terms.
With respect to the amendments to the Disclosure Rule, a small
entity that is in compliance with current law need not take any
different or additional action under the revised rule, as the revisions
merely explain how the ``on the face of the warranty'' requirement
applies to online warranty terms.
Accordingly, this document serves as notice to the Small Business
Administration of the FTC's continued certification that the amendments
will not have a significant economic impact on a substantial number of
small entities.\30\ To ensure the accuracy of this certification, the
Commission sought comment on whether the proposed amendments would have
a significant impact on a substantial number of small entities,
including specific information on the number of entities that would be
covered by the proposed amendments, the number of these companies that
are small entities, and the average annual burden for each entity.
Although the Commission certified under the RFA that the proposed
amendments would not, if promulgated, have a significant impact on a
substantial number of small entities, it included an IRFA in the NPRM
and solicited public comment on it. None of the public comments
received addressed the IRFA. The Commission continues to believe that
the amendments it is adopting will not have a significant economic
impact upon small entities, but nonetheless in the interest of caution
is providing this FRFA.
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\30\ The Commission's estimate of the number of small entities
potentially affected by the rule amendments is set forth infra.
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A. Need for, and Objectives of, the Rule Amendments

As outlined in Sections II through III above, the amendments to the
Disclosure Rule and Pre-Sale Availability Rule are made in connection
with Congress's passage of E-Warranty. E-Warranty allows, under certain
circumstances, the posting of warranties on manufacturers' Web sites as
an alternative method of complying with the Pre-Sale Availability Rule,
and allows certain sellers to use an electronic method to supply pre-
sale warranty terms.
The objective of the rule amendments is to provide warrantors an
online method of complying with the Disclosure Rule and the Pre-Sale
Availability Rule, allow certain sellers to use an electronic method to
provide pre-sale warranty terms to consumers, and to define what ``on
the face'' of an online warranty means in the Disclosure Rule.

B. Significant Issues Raised by Comments in Response to the Proposed
Rule Amendments

The Commission's responses to issues raised by commenters are
discussed above in Section III, including issues about (1) the
interaction between a warrantor's duty to provide a hard copy of an
online warranty upon request to either a seller or a prospective
purchaser of a warranted product, and a seller's duty to furnish the
warranty terms upon request prior to sale, and (2) whether sellers may
satisfy their obligations under the Pre-Sale Availability Rule simply
by referring consumers to an Internet Web site where the warrantor has
posted warranty terms.
The Commission notes that the Chief Counsel for Advocacy of the
Small Business Administration did not submit comments on the revisions.

C. Description and Estimate of the Number of Small Entities to Which
the Rule Amendments Will Apply

The small entities to which the Disclosure Rule applies are
warrantors. The small entities to which the Pre-Sale Availability Rule
applies are warrantors and sellers of warranted consumer products
costing more than fifteen dollars. The Disclosure Rule and the Pre-Sale
Availability Rule currently define a ``warrantor'' as ``any supplier or
other person who gives or offers to give a written warranty.'' The Pre-
Sale Availability Rule defines a ``seller'' as ``any person who sells
or offers for sale for purposes other than resale or use in the
ordinary course of the buyer's business any consumer product.'' The
amendments add ``manufacturers'' to both Rules' definitions of
``warrantor.'' Sellers include retailers, catalog and mail order
sellers, and door-to-door sellers.
In 2014, the Commission estimated that there were 13,395 small
manufacturers (warrantors) and 452,553 small retailers (sellers)
impacted by the Rules.\31\
---------------------------------------------------------------------------

\31\ See 79 FR 8185 (Feb. 11, 2014), which relates to the Pre-
Sale Availability Rule, but should also apply to the Disclosure
Rule.
---------------------------------------------------------------------------

D. Description of the Projected Reporting, Recordkeeping, and Other
Compliance Requirements

The amendments to the Disclosure Rule do not impose any new
reporting, recordkeeping, or other compliance requirements (e.g., new
disclosures). Rather, the amendments merely explain how the existing
``on the face of the warranty'' requirement for disclosures applies to
online and electronic warranty terms (i.e., the required

[[Page 63668]]

disclosures must be in close proximity to the warranty terms).
The Pre-Sale Availability Rule imposes disclosure obligations on
sellers and warrantors of warranted consumer goods actually costing
more than fifteen dollars. Specifically, sellers must make warranty
terms available prior to sale. Under the rule amendments, if the
warrantor has chosen the online method, sellers may incur minimal
additional costs if they need to request the warranty terms from the
warrantor to provide them to consumers, but sellers will also have
additional flexibility to make pre-sale warranty terms available to
consumers electronically. Warrantors must either continue to provide
sellers with warranty materials for sellers' use at the point of sale
as they do under the current rule, or, under the revision, provide the
address of the warrantor's Internet Web site where consumers can review
and obtain warranty terms in the product manual or on the product or
product packaging, and the warrantor's contact information for the
consumer to obtain the warranty terms via a non-Internet method.
Neither the existing Pre-Sale Availability Rule nor the amendments
require sellers or warrantors to retain more records than may be
necessary to provide consumers the warranty terms. The small entities
potentially covered by these amendments will include all such entities
subject to the Rules, including suppliers, manufacturers and others who
warrant consumer goods costing more than fifteen dollars and retailers,
catalog and mail-order sellers, and door-to-door sellers who offer the
warranted products. The professional skills necessary for compliance
with the Rules as modified by the amendments would include (1)
warrantors' office and administrative support staff to receive
consumers' and sellers' requests for warranty terms using a non-
Internet based method and (2) sellers' office and administrative
support staff to request warranty terms for pre-sale availability to
consumers for warranted goods where the warrantor has elected only the
online method and the seller cannot or chooses not to display the
warranty terms electronically.

E. Steps Taken by the Agency To Minimize the Significant Impact, If
Any, on Small Entities, Consistent With the Stated Objectives of
Applicable Statute(s)

Commenters urged the Commission to adopt a rule that would allow
sellers to comply with their obligations under the Pre-Sale
Availability Rule simply by referring consumers to an Internet Web site
where the warrantor has posted warranty terms. In a recent rule review
of the Pre-Sale Availability Rule, the Commission considered and
declined to adopt similar suggestions by commenters that offline
sellers be allowed to comply with the Rule by advising buyers of the
availability of the warranty at a particular Web site.\32\ The
Commission noted that, because the intent of the Rule is to make
warranty information available at the point of sale, a seller could not
comply with its Pre-Sale Availability Rule obligations simply by
referring the consumer to a Web site where the warranty could be
found.\33\ Those same considerations still apply in the present
rulemaking proceeding. The final rule amendments comport with
Congress's desire to allow warrantors the option of providing warranty
terms online, as long as warrantors offer a non-Internet based method
for consumers to obtain the warranty terms, as well as with Congress's
mandate that the online method not supplant the seller's duty to
provide warranty terms at the point of sale.
---------------------------------------------------------------------------

\32\ 80 FR 42710, 42717 (July 20, 2015).
\33\ Id.
---------------------------------------------------------------------------

Because the rule amendments provide an alternative means of
compliance that is available to businesses of all sizes, it is not
necessary to provide a specific small entity exemption.
The Commission believes the final rule amendments will be minimally
burdensome for small businesses and that they comply with Congress's
mandate to allow warrantors to post warranty terms on an Internet Web
site and certain sellers to employ a pre-sale electronic display
option, while ensuring pre-sale availability of warranty terms at the
point of sale.

V. Paperwork Reduction Act

Under the Paperwork Reduction Act of 1995 (PRA),\34\ federal
agencies are generally required to seek Office of Management and Budget
(OMB) approval for information collection requirements prior to
implementation. Under the PRA, the Commission may not conduct or
sponsor, and, notwithstanding any other provision of law, a person is
not required to respond to an information collection, unless the
information displays a valid control number assigned by OMB.
---------------------------------------------------------------------------

\34\ 44 U.S.C. 3501-3520.
---------------------------------------------------------------------------

These amendments revise 16 CFR parts 701 and 702. The collection of
information related to the Disclosure Rule has been previously reviewed
and approved by OMB in accordance with the PRA under OMB Control Number
3084-0111. The collection of information related to the Pre-Sale
Availability Rule has been previously reviewed and approved by OMB in
accordance with the PRA under OMB Control Number 3084-0112. As
explained below, the amendments only slightly modify or add to
information collection requirements that were previously approved by
OMB. Under these amendments, a warrantor will be permitted, but not
required, to use an online method for supplying warranty terms. The
Commission does not believe that these amendments would impose any new
or substantively revised collections of information as defined by the
PRA. None of the public comments received addressed the PRA.
Under the most recent proposed clearance for the Pre-Sale
Availability Rule, FTC staff estimated total annual hours burden to be
2,446,610. This figure represented a 20% reduction from the 2010
estimate based in large part on the growth of online sales and the
online posting of warranty terms related to those sales. The most
recent estimate included 2,315,608 hours for retailers and 131,002
hours for manufacturers. Staff estimated the total annual labor cost in
2014 to be $51,379,000 (rounded to the nearest thousand).\35\
---------------------------------------------------------------------------

\35\ See 79 FR 8185 (Feb. 11, 2014).
---------------------------------------------------------------------------

In the most recently proposed clearance for the Pre-Sale
Availability Rule, Commission staff also stated its belief that total
annual capital or other non-labor costs are de minimis because the vast
majority of sellers and warrantors already have developed systems to
provide the information the rule requires. Compliance by sellers
typically entails keeping warranties on file, in binders or otherwise,
and posting an inexpensive sign indicating warranty availability.
Warrantor compliance under the revisions entails providing sellers with
a copy of the warranties together with the product or providing with
the warranted good the address of the warrantor's Internet Web site
where the consumer can review and obtain the warranty terms, along with
the contact information where the consumer may use a non-Internet based
method to obtain a free copy of the warranty terms. Sellers of
warranted goods for which the warrantor has chosen the online method
may incur a slightly increased burden because the seller will have to
ensure it provides consumers a method of reviewing the warranty terms
at the point of sale, prior to sale. That burden, however, should be
minimal, given that the warrantor will have to make the warranty terms
available on an Internet Web site, and given the provision

[[Page 63669]]

requiring the warrantor to supply a hard copy of the warranty terms,
promptly and free of charge, in response to a seller's request. In
addition, any burden on sellers will be offset by sellers having
additional flexibility to make pre-sale warranty terms available to
consumers electronically. Commission staff believes that, in light of
the amendment, annual capital or other non-labor costs will remain de
minimis.

List of Subjects

16 CFR Part 701

Trade practices, Warranties.

16 CFR Part 702

Trade practices, Warranties.

Authority and Issuance

For the reasons set forth in the preamble, the Commission amends 16
CFR parts 701 and 702 as follows:

PART 701--DISCLOSURE OF WRITTEN CONSUMER PRODUCT WARRANTY TERMS AND
CONDITIONS

0
1. The authority citation for part 701 continues to read as follows:

Authority: 15 U.S.C. 2302 and 2309.

0
2. Amend Sec. 701.1 by redesignating paragraphs (g) through (i) as
paragraphs (h) through (j), adding new paragraph (g), revising
paragraph (h), and revising redesignated paragraph (j) to read as
follows:

Sec. 701.1 Definitions.

* * * * *
(g) Manufacturer means any person engaged in the business of making
a consumer product.
(h) Warrantor means any supplier, manufacturer, or other person who
gives or offers to give a written warranty.
* * * * *
(j) On the face of the warranty means:
(1) Where the warranty is a single sheet with printing on both
sides of the sheet or where the warranty is comprised of more than one
sheet, the page on which the warranty text begins;
(2) Where the warranty is included as part of a larger document,
such as a use and care manual, the page in such document on which the
warranty text begins;
(3) Where the warranty is on an Internet Web site or displayed
electronically, in close proximity to the location where the warranty
text begins.

PART 702--PRE-SALE AVAILABILITY OF WRITTEN WARRANTY TERMS

0
3. The authority for part 702 continues to read as follows:

Authority: 15 U.S.C. 2302 and 2309.

0
4. Amend Sec. 702.1 by revising paragraph (d) and adding paragraph
(g) to read as follows:

Sec. 702.1 Definitions.

* * * * *
(d) Warrantor means any supplier, manufacturer, or other person who
gives or offers to give a written warranty.
* * * * *
(g) Manufacturer means any person engaged in the business of making
a consumer product.

0
5. Revise Sec. 702.3 to read as follows:

Sec. 702.3 Pre-sale availability of written warranty terms.

The following requirements apply to consumer products actually
costing the consumer more than $15.00:
(a) Duties of seller. Except as provided in paragraphs (c) through
(d) of this section, the seller of a consumer product with a written
warranty shall make a text of the warranty readily available for
examination by the prospective buyer by:
(1) Displaying it in close proximity to the warranted product
(including through electronic or other means, if the warrantor has
elected the option described in paragraph (b)(2) of this section), or
(2) Furnishing it upon request prior to sale (including through
electronic or other means, if the warrantor has elected the option
described in paragraph (b)(2) of this section) and placing signs
reasonably calculated to elicit the prospective buyer's attention in
prominent locations in the store or department advising such
prospective buyers of the availability of warranties upon request.
(b) Duties of the warrantor. (1) A warrantor who gives a written
warranty warranting to a consumer a consumer product actually costing
the consumer more than $15.00 shall:
(i) Provide sellers with warranty materials necessary for such
sellers to comply with the requirements set forth in paragraph (a) of
this section, by the use of one or more of the following means:
(A) Providing a copy of the written warranty with every warranted
consumer product;
(B) Providing a tag, sign, sticker, label, decal or other
attachment to the product, which contains the full text of the written
warranty;
(C) Printing on or otherwise attaching the text of the written
warranty to the package, carton, or other container if that package,
carton or other container is normally used for display purposes. If the
warrantor elects this option a copy of the written warranty must also
accompany the warranted product; or
(D) Providing a notice, sign, or poster disclosing the text of a
consumer product warranty. If the warrantor elects this option, a copy
of the written warranty must also accompany each warranted product.
(ii) Provide catalog, mail order, and door-to-door sellers with
copies of written warranties necessary for such sellers to comply with
the requirements set forth in paragraphs (c) and (d) of this section.
(2) As an alternative method of compliance with paragraph (b)(1) of
this section, a warrantor may provide the warranty terms in an
accessible digital format on the warrantor's Internet Web site. If the
warrantor elects this option, the warrantor must:
(i) Provide information to the consumer that will inform the
consumer how to obtain warranty terms by indicating, in a clear and
conspicuous manner, in the product manual or on the product or product
packaging:
(A) The Internet Web site of the warrantor where such warranty
terms can be reviewed, and
(B) The phone number, the postal mailing address of the warrantor,
or other reasonable non-Internet based means for the consumer to
request a copy of the warranty terms;
(ii) Provide a hard copy of the warranty terms promptly and free of
charge upon request by a consumer or seller made pursuant to paragraph
(b)(2)(i)(B) of this section;
(iii) Ensure that warranty terms are posted in a clear and
conspicuous manner and remain accessible to the consumer on the
Internet Web site of the warrantor; and
(iv) Provide information with the consumer product or on the
Internet Web site of the warrantor sufficient to allow the consumer to
readily identify on such Internet Web sites the warranty terms that
apply to the specific warranted product.
(3) Paragraph (a)(1) of this section shall not be applicable with
respect to statements of general policy on emblems, seals or insignias
issued by third parties promising replacement or refund if a consumer
product is defective, which statements contain no representation or
assurance of the quality or performance characteristics of the product;
provided that
(i) The disclosures required by Sec. 701.3(a)(1) through (9) of
this chapter are published by such third parties in each issue of a
publication with a general circulation, and

[[Page 63670]]

(ii) Such disclosures are provided free of charge to any consumer
upon written request.
(c) Catalog and mail order sales. (1) For purposes of this
paragraph:
(i) Catalog or mail order sales means any offer for sale, or any
solicitation for an order for a consumer product with a written
warranty, which includes instructions for ordering the product which do
not require a personal visit to the seller's establishment.
(ii) Close conjunction means on the page containing the description
of the warranted product, or on the page facing that page.
(2) Any seller who offers for sale to consumers consumer products
with written warranties by means of a catalog or mail order
solicitation shall clearly and conspicuously disclose in such catalog
or solicitation in close conjunction to the description of the
warranted product, or in an information section of the catalog or
solicitation clearly referenced, including a page number, in close
conjunction to the description of the warranted product, either:
(i) The full text of the written warranty; or
(ii) The address of the Internet Web site of the warrantor where
such warranty terms can be reviewed (if such Internet Web site exists),
as well as that the written warranty can be obtained free upon specific
request, and the address or phone number where such warranty can be
requested. If this option is elected, such seller shall promptly
provide a copy of any written warranty requested by the consumer (and
may provide such copy through electronic or other means, if the
warrantor has elected the option described in paragraph (b)(2) of this
section).
(d) Door-to-door sales. (1) For purposes of this paragraph:
(i) Door-to-door sale means a sale of consumer products in which
the seller or his representative personally solicits the sale,
including those in response to or following an invitation by a buyer,
and the buyer's agreement to offer to purchase is made at a place other
than the place of business of the seller.
(ii) Prospective buyer means an individual solicited by a door-to-
door seller to buy a consumer product who indicates sufficient interest
in that consumer product or maintains sufficient contact with the
seller for the seller reasonably to conclude that the person solicited
is considering purchasing the product.
(2) Any seller who offers for sale to consumers consumer products
with written warranties by means of door-to-door sales shall, prior to
the consummation of the sale, disclose the fact that the sales
representative has copies of the warranties for the warranted products
being offered for sale, which may be inspected by the prospective buyer
at any time during the sales presentation. Such disclosure shall be
made orally and shall be included in any written materials shown to
prospective buyers. If the warrantor has elected the option described
in paragraph (b)(2) of this section, the sales representative may
provide a copy of the warranty through electronic or other means.

By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2016-21853 Filed 9-14-16; 8:45 am]
BILLING CODE 6750-01-P

Federal Register / Vol. 81, No. 179 / Thursday, September 15, 2016 / Rules and Regulations 63667

the final rule, replacing the phrase revisions merely explain how the ‘‘on B. Significant Issues Raised by
‘‘specific product purchased by the the face of the warranty’’ requirement Comments in Response to the Proposed
consumer’’ with ‘‘specific warranted applies to online warranty terms. Rule Amendments
product.’’ Accordingly, this document serves as The Commission’s responses to issues
IV. Regulatory Flexibility Act notice to the Small Business raised by commenters are discussed
Administration of the FTC’s continued above in Section III, including issues
The Regulatory Flexibility Act 26
certification that the amendments will about (1) the interaction between a
(RFA) requires each agency either to
not have a significant economic impact warrantor’s duty to provide a hard copy
provide an Initial Regulatory Flexibility
on a substantial number of small of an online warranty upon request to
Analysis (IRFA) 27 with a proposed rule
entities.30 To ensure the accuracy of this either a seller or a prospective purchaser
and a Final Regulatory Flexibility
certification, the Commission sought of a warranted product, and a seller’s
Analysis (FRFA) 28 with the final rule,
duty to furnish the warranty terms upon
or certify that the proposed rule will not comment on whether the proposed
request prior to sale, and (2) whether
have a significant economic impact on amendments would have a significant
sellers may satisfy their obligations
a substantial number of small entities.29 impact on a substantial number of small under the Pre-Sale Availability Rule
The FTC does not expect that the rule entities, including specific information simply by referring consumers to an
revisions necessitated by E-Warranty on the number of entities that would be Internet Web site where the warrantor
will have a significant economic impact covered by the proposed amendments, has posted warranty terms.
on small sellers and warrantors. As the number of these companies that are The Commission notes that the Chief
discussed above, the revisions will small entities, and the average annual Counsel for Advocacy of the Small
relieve those warrantors who choose the burden for each entity. Although the Business Administration did not submit
online method from providing warranty Commission certified under the RFA comments on the revisions.
materials to certain sellers. Affected that the proposed amendments would
sellers, however, should be able easily C. Description and Estimate of the
not, if promulgated, have a significant
to obtain the warranties and provide Number of Small Entities to Which the
impact on a substantial number of small Rule Amendments Will Apply
them to consumers for review at the
entities, it included an IRFA in the
point of sale, either by obtaining the The small entities to which the
warranties from the warrantor’s Web NPRM and solicited public comment on
it. None of the public comments Disclosure Rule applies are warrantors.
site or by requesting a hard copy from The small entities to which the Pre-Sale
the warrantor. Also, the amendments received addressed the IRFA. The
Availability Rule applies are warrantors
allow sellers of goods whose warrantors Commission continues to believe that
and sellers of warranted consumer
have employed the online method the the amendments it is adopting will not
products costing more than fifteen
ability to provide pre-sale warranty have a significant economic impact
dollars. The Disclosure Rule and the
terms electronically. Thus, under the upon small entities, but nonetheless in Pre-Sale Availability Rule currently
revised Rule, a small seller that is in the interest of caution is providing this define a ‘‘warrantor’’ as ‘‘any supplier or
compliance with current law would FRFA. other person who gives or offers to give
need to take only minimal additional a written warranty.’’ The Pre-Sale
A. Need for, and Objectives of, the Rule
action to remain compliant. Availability Rule defines a ‘‘seller’’ as
The small warrantor that does not Amendments
‘‘any person who sells or offers for sale
choose the online method to supply As outlined in Sections II through III for purposes other than resale or use in
warranty terms can remain compliant above, the amendments to the the ordinary course of the buyer’s
simply by continuing with its existing Disclosure Rule and Pre-Sale business any consumer product.’’ The
practices. If a small warrantor has Availability Rule are made in amendments add ‘‘manufacturers’’ to
previously been including the entire both Rules’ definitions of ‘‘warrantor.’’
connection with Congress’s passage of
warranty with the warranted product Sellers include retailers, catalog and
E-Warranty. E-Warranty allows, under
and supplying warranty materials so mail order sellers, and door-to-door
that sellers can meet Pre-Sale certain circumstances, the posting of
warranties on manufacturers’ Web sites sellers.
Availability Rule obligations, but In 2014, the Commission estimated
instead elects the online method under as an alternative method of complying
with the Pre-Sale Availability Rule, and that there were 13,395 small
the amendments, the small warrantor manufacturers (warrantors) and 452,553
will have a smaller overall compliance allows certain sellers to use an
small retailers (sellers) impacted by the
burden because it will be able to electronic method to supply pre-sale
Rules.31
provide the warranty terms solely on an warranty terms.
Internet Web site. That small warrantor, The objective of the rule amendments D. Description of the Projected
however, will likely incur some costs to Reporting, Recordkeeping, and Other
is to provide warrantors an online
establish a phone number, address, or Compliance Requirements
method of complying with the
other non-Internet based method that Disclosure Rule and the Pre-Sale The amendments to the Disclosure
consumers and sellers can use to request Availability Rule, allow certain sellers Rule do not impose any new reporting,
a free hard copy of warranty terms. to use an electronic method to provide recordkeeping, or other compliance
With respect to the amendments to requirements (e.g., new disclosures).
pre-sale warranty terms to consumers,
the Disclosure Rule, a small entity that Rather, the amendments merely explain
and to define what ‘‘on the face’’ of an
sradovich on DSK3GMQ082PROD with RULES3

is in compliance with current law need how the existing ‘‘on the face of the
online warranty means in the Disclosure
not take any different or additional warranty’’ requirement for disclosures
action under the revised rule, as the Rule.
applies to online and electronic
warranty terms (i.e., the required
26 5 U.S.C. 601–612.
27 5 U.S.C. 603. 30 The Commission’s estimate of the number of 31 See 79 FR 8185 (Feb. 11, 2014), which relates
28 5 U.S.C. 604. small entities potentially affected by the rule to the Pre-Sale Availability Rule, but should also
29 5 U.S.C. 605. amendments is set forth infra. apply to the Disclosure Rule.

VerDate Sep<11>2014 18:31 Sep 14, 2016 Jkt 238001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 E:\FR\FM\15SER3.SGM 15SER3

$63670 Federal Register / Vol. 81, No. 179 / Thursday, September 15, 2016 / Rules and Regulations (ii) Such disclosures are provided free (ii) The address of the Internet Web sufficient contact with the seller for the of charge to any consumer upon written site of the warrantor where such seller reasonably to conclude that the request. warranty terms can be reviewed (if such person solicited is considering (c) Catalog and mail order sales. (1) Internet Web site exists), as well as that purchasing the product. For purposes of this paragraph: the written warranty can be obtained (i) Catalog or mail order sales means (2) Any seller who offers for sale to free upon specific request, and the any offer for sale, or any solicitation for consumers consumer products with address or phone number where such an order for a consumer product with a written warranties by means of door-to- warranty can be requested. If this option written warranty, which includes is elected, such seller shall promptly door sales shall, prior to the instructions for ordering the product provide a copy of any written warranty consummation of the sale, disclose the which do not require a personal visit to requested by the consumer (and may fact that the sales representative has the seller’s establishment. provide such copy through electronic or copies of the warranties for the (ii) Close conjunction means on the other means, if the warrantor has warranted products being offered for page containing the description of the elected the option described in sale, which may be inspected by the warranted product, or on the page facing paragraph (b)(2) of this section). prospective buyer at any time during the that page. sales presentation. Such disclosure shall (2) Any seller who offers for sale to (d) Door-to-door sales. (1) For purposes of this paragraph: be made orally and shall be included in consumers consumer products with any written materials shown to written warranties by means of a catalog (i) Door-to-door sale means a sale of consumer products in which the seller prospective buyers. If the warrantor has or mail order solicitation shall clearly or his representative personally solicits elected the option described in and conspicuously disclose in such the sale, including those in response to paragraph (b)(2) of this section, the sales catalog or solicitation in close conjunction to the description of the or following an invitation by a buyer, representative may provide a copy of warranted product, or in an information and the buyer’s agreement to offer to the warranty through electronic or other section of the catalog or solicitation purchase is made at a place other than means. clearly referenced, including a page the place of business of the seller. By direction of the Commission. number, in close conjunction to the (ii) Prospective buyer means an Donald S. Clark, description of the warranted product, individual solicited by a door-to-door Secretary. either: seller to buy a consumer product who [FR Doc. 2016–21853 Filed 9–14–16; 8:45 am] (i) The full text of the written indicates sufficient interest in that warranty; or consumer product or maintains BILLING CODE 6750–01–P sradovich on DSK3GMQ082PROD with RULES3 VerDate Sep<11>2014 18:31 Sep 14, 2016 Jkt 238001 PO 00000 Frm 00008 Fmt 4701 Sfmt 9990 E:\FR\FM\15SER3.SGM 15SER3$

Document Created: 2018-02-09 13:18:08
Document Modified: 2018-02-09 13:18:08

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Rules and Regulations
Action		Final rule.
Dates		Effective on October 17, 2016.
Contact		Gary Ivens, (202) 326-2330, Attorney, Division of Marketing Practices, Federal Trade Commission, 600 Pennsylvania Ave. NW., Washington, DC 20580.
FR Citation		81 FR 63664
RIN Number		3084-AB24
CFR Citation		16 CFR 701 16 CFR 702
CFR Associated		Trade Practices and Warranties