Rule Concerning Advertising and Labeling of Sleeping Bags

FEDERAL TRADE COMMISSION

16 CFR Part 400

Rule Concerning Advertising and Labeling of Sleeping Bags

AGENCY: Federal Trade Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: the Federal Trade Commission (``Commission'') announces the

commencement of a rulemaking proceeding for the trade regulation rule

concerning Advertising and Labeling of Sleeping Bags (``Sleeping Bag

Rule'' or ``Rule''), 16 CFR Part 400. The proceeding will address

whether or not the Sleeping Bag Rule should be repealed. The Commission

invites interested parties to submit written data, views, and arguments

on how the rule has affected consumers, businesses and others, and on

whether there currently is a need for the rule. This notice includes a

description of the procedures to be followed, an invitation to submit

written comments, a list of questions and issues upon which the

Commission particularly desires comments, and instructions for

prospective witnesses and other interested persons who desire to

participate in the proceeding.

DATES: Written comments must be submitted on or before October 18,

1995.

Notifications of interest must be submitted on or before October

18, 1995. If interested parties request the opportunity to present

testimony, the Commission will publish a notice in the Federal Register

stating the time and place at which the hearings will be held and

describing the procedures that will be followed in conducting the

hearings. In addition to submitting a request to testify, interested

parties who wish to present testimony must submit, on or before October

18, 1995, a written comment or statement that describes the issues on

which the party wishes to testify and the nature of the testimony to be

given.

ADDRESSES: Written comments and requests to testify should be submitted

to Office of the Secretary, Federal Trade Commission, Room H-159, Sixth

Street and Pennsylvania Avenue, NW., Washington, DC 20580, telephone

number 202-326-2506. Comments and requests to testify should be

identified as ``16 CFR Part 400--Comment--Sleeping Bag Rule'' and ``16

CFR Part 400--Request to Testify--Sleeping Bag Rule,'' respectively. If

possible, submit comments both in writing and on a personal computer

diskette in Work Perfect or other word processing format (to assist in

processing, please identify the format and version used). Written

comments should be submitted, when feasible and not burdensome, in five

copies.

FOR FURTHER INFORMATION CONTACT:

John A. Crowley, Attorney, Bureau of Consumer Protection, Division of

Service Industry Practices, Room H-200, Sixth Street and Pennsylvania

Avenue, NW., Washington, DC 20580, telephone number 202-326-3280.

SUPPLEMENTARY INFORMATION:

I. Introduction

On May 23, 1995 the Commission published an Advance Notice of

Proposed Rulemaking (``ANPR'') seeking comment on the proposed repeal

of the Sleeping Bag Rule, 60 FR 27240. In accordance with mandates of

section 18 of the Federal Trade Commission Act (``FTC Act''), 15 U.S.C.

57a, the ANPR was sent to the Chairman of the Committee on Commerce,

Science, and Transportation, United States Senate and the Chairman of

the Subcommittee on Commerce, Trade and Hazardous Materials, United

States House of Representatives. The ANPR comment period closed on June

22, 1995. The Commission received no public comments.

Pursuant to the FTC Act, 15 U.S.C. 41-58, and the Administrative

Procedure Act, 5 U.S.C. 551-59, 701-06, by this Notice of Proposed

Rulemaking (``NPR'') the Commission initiates a proceeding to consider

whether the Sleeping Bag Rule should be repealed or remain in effect,

and solicits public comments.\1\ The Commission is also interested in

comments on whether the Rule should be streamlined or otherwise

amended. If the Commission determines, based on the data, views and

arguments submitted, that the Commission should consider additional

alternatives, it will publish a supplemental notice of proposed

rulemaking and will request public comments on those alternatives.

\1\ In accordance with mandates of section 18 of the FTC Act, 15

U.S.C. 57a, the Commission submitted this NPR to the Chairman of the

Committee on Commerce, Science, and Transportation, United States

Senate and the Chairman of the Subcommittee on Commerce, Trade and

Hazardous Materials, United States House of Representatives 30 days

prior to publication of the NPR.

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The Commission is undertaking this rulemaking proceeding as part of

the Commission's ongoing program of evaluating trade regulation rules

and industry guides to determine their effectiveness, impact, cost and

need. This proceeding also responds to President Clinton's National

Regulatory Reinvention Initiative, which, among other things, urges

agencies to eliminate obsolete or unnecessary regulations.

II. Background Information

The Sleeping Bag Rule regulates the advertising, labeling and

marking of the dimensions of sleeping bags. The Commission had found

that the practice of labeling sleeping bags by the dimensions of the

unfinished material used in their construction (cut size) was

misleading consumers about the actual size of the sleeping bag. To

correct this misconception, the Commission in 1963 promulgated the

Sleeping Bag Rule which provides that it is an unfair method of

competition and an unfair or deceptive act or practice to use the ``cut

size'' of the materials from which a sleeping bag is made to describe

the size of a sleeping bag in advertising, labeling or marking unless:

(1) ``The dimensions of the cut size are accurate measurements of

the yard goods used in construction of the sleeping bags''; and

(2) ``Such `cut size' dimensions are accompanied by the words `cut

size' ''; and

(3) The reference to ``cut size'' is ``accompanied by a clear and

conspicuous disclosure of the length and width of the finished products

and by an explanation that such dimension constitute the finished

size''.\2\

\2\ The rule then gives an example of proper size marking:

``Finished size 33'' x 68''' cut size 36'' x 72''.''

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The Commission, as part of its oversight responsibilities, reviews

rules and guides periodically. These reviews seek information about the

costs and benefits of the Commission's rules and guides and their

regulatory and economic impact. The information obtained assists the

Commission in identifying rules and guides that warrant modification or

rescission. Accordingly, on April 19, 1993, the Commission published in

the Federal register a request for public comments on its Trade

Regulation Rule on Advertising and Labeling as to Size as

[[Page 48064]]

to Size of Sleeping Bags, 16 CFR 400 (``Rule'').

In its Request for Comment, the Commission asked commenters to

address the costs and benefits of the rule, whether there was a

continuing need for this regulation, the burdens placed on businesses

subject to this regulation, whether changes should be made, any

conflicts with other laws, and whether changes in technology affected

the rule.

Only one specific comment relating to the Sleeping Bag Rule was

received, which generally supported a continuation of this regulation.

In addition to this specific comment, one general comment,

applicable to several rules being reviewed was received from an

advertising agency association. The organization recommended rescission

of the Sleeping Bag Rule, because the general prohibitions of the FTC

Act covering false and deceptive advertising apply to the sleeping bag

industry and the Rule creates unnecessary administrative costs for the

government, industry members and consumers.

Commission staff also conducted an informal inquiry and inspected

sleeping bags at several national chain stores. This inquiry found no

violations of the Rule on either the sleeping bag packaging materials

or the labels affixed to the product itself. In fact, it appeared from

that limited inquiry that industry products were marked with only the

finished size. Additionally, the Commission has no record of receiving

any complaints regarding non-compliance with the rule, or of initiating

any law enforcement actions alleging violation of the rule's

requirements, 60 FR 2724-41. Finally, the Uniform Packaging and

Labeling Regulation, which has been adopted by 47 states, regulates the

labeling of sleeping bags, and appears to provide that these items must

be labeled with their finished size, 60 FR 27241.

On May 23, 1995, the Commission issued an Advance notice of

proposed rulemaking (ANPR) based on a review of the submissions

received in response to the aforementioned request for comments. The

Commission determined that there may no longer be a need to continue

the Rule in light of the apparent changes in industry practices and the

existence of laws in nearly all of the states that appear to mandate

point-of-sale disclosures similar to those required by the Rule. No

comments were received in response to this request.

III. Rulemaking Procedures

The Commission finds that the public interest will be served by

using expedited procedures in this proceeding. First, there do not

appear to be any material issues of disputed fact to resolve in

determining whether to repeal the rule. Second, the use of expedited

procedures will support the Commission's goal of eliminating obsolete

or unnecessary regulations without an undue expenditure of resources,

while ensuring that the public has an opportunity to submit data, views

and arguments on whether the Commission should repeal the Rule.

The Commission, therefore, has determined, pursuant to 16 CFR 1.20,

to use the procedures set forth in this notice. These procedures

include: (1) Publishing this Notice of Proposed Rulemaking; (2)

soliciting written comments on the Commission's proposal to repeal the

Rule; (3) holding an informal hearing, if requested by interested

parties; (4) obtaining a final recommendation from staff and (5)

announcing final Commission action in a notice published in the Federal

Register.

IV. Invitation to Comment and Questions for Comment

Interested persons are requested to submit written data, views or

arguments on any issue of fact, law or policy they believe may be

relevant to the Commission's decision on whether to repeal the Rule.

The Commission requests that commenters provide representative factual

data in support of their comments. Individual firms' experience are

relevant to the extent they typify industry experience in general or

the experience of similar-size firms. Commenters opposing the proposed

repeal of the Rule should explain the reasons they believe the Rule is

still needed and, if appropriate, suggest specific alternatives.

Proposals for alternative requirements should include reasons and data

that indicate why the alternatives would better protect consumers from

unfair or deceptive acts or practices under section 5 of the FTC Act,

15 U.S.C. 45.

Although the Commission welcomes comments on any aspect of the

proposed repeal of the Rule, the Commission is particularly interested

in comments on questions and issues raised in this Notice. All written

comments should state clearly the question or issue that the commenter

is addressing.

Before taking final action, the Commission will consider all

written comments timely submitted to the Secretary of the Commission

and testimony given on the record at any hearings scheduled in response

to requests to testify. Written comments submitted will be available

for public inspection in accordance with the Freedom of Information

Act, 5 U.S.C. 552, and Commission regulations, on normal business days

between the hours of 8:30 a.m. to 5:00 p.m. at the Federal Trade

Commission, Public Reference Room, Room H-130, Federal Trade

Commission, Sixth Street and Pennsylvania Avenue, NW., Washington, DC

20580, telephone number 202-326-2222.

Questions

(1) Do manufacturers and sellers of sleeping bags currently use

``cut size'' as a means of marking the size of their products for sale

at retail to customers?

(2) Does the fact that nearly all of the states have adopted the

Uniform Packaging and Labeling Regulation, which governs the labeling

of sleeping bags, eliminate or greatly lessen the need for the Sleeping

Bag Rule?

(3) Are there other federal or state laws or regulations, or

private industry standards that eliminate a need for the Rule?

(4) What are the benefits and costs of the Rule to consumers?

(5) What are the benefits and the costs of the Rule to firms

subject to the Rule's requirements?

(6) Does this Rule overlap or conflict with other federal, state,

or local government laws or regulations?

(7) Is there a continuing need for the Rule or should the Rule be

repealed?

V. Requests for Public Hearings

Because there does not appear to be any dispute as to the material

facts or issues raised by this proceeding and because written comments

appear adequate to present the views of all interested parties, a

public hearing has not been scheduled. If any person would like to

present testimony at a public hearing, he or she should follow the

procedures set forth in the DATES and ADDRESSES sections of this

Notice.

VI. Preliminary Regulatory Analysis

The Regulatory Flexibility Act (``RFA''), 5 U.S.C. 601-11, requires

an analysis of the anticipated impact of the proposed repeal of the

Rule on small businesses.\3\ The analysis must contain,

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as applicable, a description of the reasons why action is being

considered, the objectives of and legal basis for the proposed action,

the class and number of small entities affected, the projected

reporting, recordkeeping and other compliance requirements being

proposed, any existing federal rules which may duplicate, overlap or

conflict with the proposed action, and any significant alternatives to

the proposed action that accomplish its objectives and, at the same

time, minimize its impact on small entities.

\3\ Section 22 of the FTC Act, 15 U.S.C. 57b-3, also requires

the Commission to perform ``regulatory impact analyses'' of a

proposed rule, but only if the rule will have certain

``significant'' economic or regulatory effects. The Commission has

determined that a preliminary regulatory analysis is not required by

section 22 in this proceeding because the Commission has no reason

to believe that repealing the Rule will have a ``significant''

economic or regulatory impact, either beneficial or detrimental,

upon persons subject to the Rule or upon consumers.

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A description of the reasons why action is being considered and the

objectives of the proposed repeal of the Rule have been explained

elsewhere in this Notice. Repeal of the Rule would appear to have

little or no effect on any small business. The Commission is not aware

of any existing federal laws or regulations that would conflict with

repeal of the Rule.

In light of these reasons, the Commission certifies, pursuant to

section 605 of RFA, 5 U.S.C. 605, that if the Commission determines to

repeal the Rule that action will not have a significant impact on a

substantial number of small entities. To ensure that no substantial

economic impact is being overlooked, however, the Commission requests

comments on this issue. After reviewing any comments received, the

Commission will determine whether it is necessary to prepare a final

regulatory flexibility analysis.

VII. Paperwork Reduction Act

The Sleeping Bag Rule does not impose ``information collection

requirements'' under the Paperwork Reduction Act (``PRA''), 44 U.S.C.

3501 et seq. The Rule, however, does contain disclosure requirements,

which specify that certain additional information must be given

whenever the words ``cut-size'' are used to describe the dimensions of

a sleeping bag.\4\ Accordingly, repeal of the Rule would eliminate any

burdens on the public imposed by these disclosure requirements.

\4\ Under amendments to the P.R.A. in the Paperwork Reduction

Act of 1995 (Pub. L. 104-13, 109 Stat. 163, to be codified at 44

U.S.C. 3501-20), which will become effective on October 1, 1995,

these third-party disclosures may constitute a ``collection of

information'' for which OMB clearance must be sought.

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VIII. Additional Information for Interested Persons

A. Motions or Petitions

Any motions or petitions in connection with this proceeding must be

filed with the Secretary of the Commission.

B. Communications by Outside Parties to Commissioners or Their Advisors

Pursuant to Rule 1.18(c) of the Commission's Rules of Practice, 16

CFR 1.18(c), communications with respect to the merits of this

proceeding from any outside party to any Commissioner or Commissioner's

advisor during the course of this rulemaking shall be subject to the

following treatment. Written communications, including written

communications from members of Congress, shall be forwarded promptly to

the Secretary for placement on the public record. Oral communications,

not including oral communications from members of Congress, are

permitted only when such oral communications are transcribed verbatim

or summarized at the discretion of the Commissioner or Commissioner's

advisor to whom such oral communications are made, and are promptly

placed on the public record, together with any written communications

relating to such oral communications. Memoranda prepared by a

Commissioner or Commissioner's advisor setting forth the contents of

any oral communications from members of Congress shall be placed

promptly on the public record. If the communication with a member of

Congress is transcribed verbatim or summarized, the transcript or

summary will be placed promptly on the public record.

List of Subjects in 16 CFR Part 400

Advertising, Trade practices, Sleeping bags.

Authority: 15 U.S.C. 41-58.

By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 95-23041 Filed 9-15-95; 8:45 am]

BILLING CODE 6750-01-M