Rules and Regulations Under the Textile Fiber Products Identification Act

FEDERAL TRADE COMMISSION

16 CFR Part 303

Rules and Regulations Under the Textile Fiber Products

Identification Act

AGENCY: Federal Trade Commission.

ACTION: Notice of final rulemaking.

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SUMMARY: On December 6, 1995, the Federal Trade Commission

(``Commission'') initiated a notice-and-comment rulemaking proceeding

by publishing a Notice of Proposed Rulemaking in the Federal Register

to solicit comment on whether Rule 7(d) of the Rules and Regulations

Under the Textile Fiber Products Identification Act should be amended

to allow use of the name ``lyocell'' as an alternative to the generic

name ``rayon'' for a specific subclass of rayon fibers defined in the

proposed amendment. The Commission has analyzed the record developed

during that proceeding and has concluded that the lyocell subclass has

sufficiently different characteristics from other rayons to justify use

of the term ``lyocell'' as an alternative to the generic name ``rayon''

for that subclass. The Commission announces, therefore, that Textile

Rule 7(d) will be amended. The amendment will allow the use of the term

``lyocell'' as a generic name on disclosures required by the Textile

Act for fibers that meet the definition of lyocell in the amendment.

This Notice summarizes the comments received in response to the

December 6, 1995, Notice of Proposed Rulemaking and sets out the

Commission's final action in this matter.

EFFECTIVE DATE: May 15, 1996.

FOR FURTHER INFORMATION CONTACT:

Bret S. Smart, Program Advisor, Los Angeles Regional Office, Federal

Trade Commission, 11000 Wilshire Boulevard, #13209, Los Angeles, CA

90024, (310) 235-4040.

SUPPLEMENTARY INFORMATION:

I. Background

Rule 6 \1\ of the Rules and Regulations under the Textile Fiber

Products Identification Act (``Textile Act'') \2\ requires use of

generic names of the fibers contained in textile fiber products in

making required disclosures of the fiber content of the products. Rule

7 \3\ sets forth the generic names and definitions that the Commission

has established for manufactured fibers. Rule 8 \4\ sets forth the

procedures for establishing new generic names for manufactured fibers.

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\1\ 16 CFR 303.6.

\2\ 15 U.S.C. 70, et seq.

\3\ 16 CFR 303.7.

\4\ 16 CFR 303.8.

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On January 27, 1992, Courtaulds Fibers, Inc. (``Courtaulds'')

applied to the Commission requesting establishment of a new generic

name and definition for a fiber it manufactures. It recommended

``lyocell'' be adopted as the new generic name for this fiber. In its

application, Courtaulds stated that this cellulosic fiber differs in

kind and chemical structure from any of the existing fiber definitions

of Rule 7.\5\

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\5\ Courtaulds' application and related materials have been

placed on the rulemaking record.

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After an initial analysis, the Commission granted Courtaulds the

designation ``CF0001'' for temporary use in identifying the fiber until

final disposition of the application.

Courtaulds' application and other related documents and materials

describe the lyocell fiber, its manufacture, and possible uses as

follows:

Lyocell fiber results from the dissolution of cellulose into an

aqueous solution of N-methyl morpholine oxide and the precipitation

of the fiber out of solution. This process is unique among methods

used to manufacture other existing rayons. As a result, the

molecular structure of lyocell fiber is radically different from

that of other rayons in that it has a substantially higher degree of

polymerization and greater crystallinity. These differences induce

high wet and dry tenacity as well as high initial wet modulus

[[Page 16386]]

in lyocell fiber. Consequently, garments made from the fiber are

highly resistant to shrinkage and wrinkling and therefore do not

require dry-cleaning, unlike other rayons.

Based on its review of Courtaulds' application and related

materials, the Commission solicited comments in its December 6, 1995,

Notice of Proposed Rulemaking \6\ on a proposed amendment to the Rule

7(d) definition of rayon.\7\ The proposed amendment would add the

following sentence:

\6\ 60 FR 62352 (Dec. 6, 1995).

\7\ Rule 7(d) (16 CFR 303.7(d)) currently defines ``rayon'' as,

``a manufactured fiber composed of regenerated cellulose, as well as

manufactured fibers composed of regenerated cellulose in which

substituents have replaced not more than 15% of the hydrogens of the

hydroxyl groups.''

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Where the fiber is composed of cellulose precipitated from an

organic solution in which no substitution of the hydroxyl groups

takes place and no chemical intermediates are formed, the term

lyocell may be used as a generic description of the fiber.

The effect of this proposed amendment would be to allow use of the

name ``lyocell' as an alternative to the generic name ``rayon'' for the

subclass of fibers meeting the criteria contained in the proposed

second sentence.\8\

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\8\ Within the established 21 generic names for manufactured

fibers, there are currently two cases where such generic name

alternatives may be used. Pursuant to Rule 7(e) (16 CFR 303.7(e)),

within the generic category ``acetate,'' the term ``triacetate'' may

be used as an alternative generic description for a specifically

defined subclass of acetate fiber. Pursuant to Rule 7(j) (16 CFR

303.7(j)), within the generic category ``rubber,'' the term

``lastrile'' may be used as an alternative generic description for a

specifically defined subclass of rubber fiber.

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In the Notice of Proposed Rulemaking, the Commission took the

opportunity to clarify its 1973 statement of policy concerning the

criteria by which it will decide the disposition of applications filed

under Rule 8.\9\ The Notice of Proposed Rulemaking stated as follows:

\9\ In 1973 the Commission summarized its policy for adopting

generic fiber names, as follows:

[T]he Commission, in the interest of elucidating the grounds on

which it has based this decision and shall base future decisions as

to the grant of generic names for textile fibers, sets out the

following criteria for grant of such generic names.

1. The fiber for which a generic name is requested must have a

chemical composition radically different from other fibers, and that

distinctive chemical composition must result in distinctive physical

properties of significance to the general public.

2. The fiber must be in active commercial use or such use must

be immediately foreseen.

3. The grant of the generic name must be of importance to the

consuming public at large, rather than to a small group of

knowledgeable professionals such as purchasing officers for large

Government agencies.

The Commission believes it is in the public interest to prevent

the proliferation of generic names, and will adhere to a stringent

application of the above-mentioned criteria in consideration of any

future applications for generic names and in a systematic review of

any generic names previously granted which no longer meet these

criteria.

(See 38 FR 34114, November 12, 1973.)

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As exemplified by today's action and reflected in this notice,

the Commission generally reaffirms its 1973 criteria. In addition,

it notes that where appropriate, in considering application for new

generic names for fibers that are of the same general chemical

composition as those for which a generic name already has been

established, rather than of a chemical composition that is radically

different, but that have distinctive properties of importance to the

general public as a result of a new method of manufacture or their

substantially differentiated physical characteristics, such as their

fiber structure, it may allow such fiber to be designated in

required information disclosures by either its generic name, or

alternatively, by its ``subclass'' name. The Commission will

consider this disposition when the distinctive feature or features

of the subclass fiber make it suitable for uses for which other

fibers under the established generic name would not be suited or

would be significantly less well suited.

Based on the information available to it at the time comments were

solicited, the Commission further stated in the Notice of Proposed

Rulemaking as follows:

The Commission believes that Courtaulds' current application

describes a subclass of generic rayon fibers with significant

distinctions to consumers resulting from physical characteristics of

the fiber and its new mode of manufacture that meet the above

standard for allowing designation by the subclass name ``lyocell.''

II. Summary and Analysis of Comments

A. Summary

There were twenty-seven comments submitted in this proceeding.\10\

Twenty-six of these were one page in length and generally expressed

support for the Commission's proposed amendment to Rule 7(d). Nearly

half of the comments additionally stated that lyocell has significantly

different characteristics from other rayons. Among these letters was

one from the Austrian company, Lenzing AG. Describing itself as ``the

world's leading producer of viscose staple fiber,'' Lenzing AG

commented as follows:

\10\ Los Angeles Dye & Denim Finish, Inc. (1), Parkdale Mills,

Inc. (2), JPS Converter and Industrial Corp. (3), Lee Company (4),

New Cherokee Corporation (5), Horizon Textiles Corp. (6), Ge-Ray

Fabrics, Inc. (7), Burlington Madison Yarn Company (8), Greenwood

Mills, Inc. (9), Dixie Yarns, Inc. (10), Stonecutter Mills

Corporation (11), Burlington Industries, Inc. (12), New Cherokee

Corporation (13), Milliken (14), David Dart (15), Burlington Denim

(16), Threads USA (17), Threads USA (18), Dan River, Inc. (19),

Lenzing AG (20), Milliken (21), Milliken (22), Guilford Mills, Inc.

(23), American Fiber Manufacturers Association, Inc. (24), Springs

(25), Eileen Fisher (26), Allied Tube & Conduit Corporation (27).

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[Lenzing] welcomes and supports the FTC's proposal to add

``lyocell'' to the list of approved generic names.

Lenzing AG has developed a lyocell fiber and currently operates

a small scale pilot plant. A commercial scale plant of 24,000 tonnes

a year is under construction, but already before its completion mid

1997 will the fiber be marketed in the USA under the trade name

``Lyocell by Lenzing.''

The decision for a new cellulosic fiber technology has been

taken because of the unique and significantly different

characteristics that differentiate ``lyocell'' clearly from rayon

and/or viscose. We feel strongly that the consumer will actively

seek the inherent fiber properties and a clear reference to

``lyocell'' in the fiber content label of a textile product will be

appreciated.\11\

\11\ Lenzing AG (20) p.1.

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The American Fiber Manufacturers Association, Inc. (``AFMA'')

submitted a two-page letter with thirteen pages of attachments. The

letter states as follows:

AFMA is the domestic trade association for the U.S. manufactured

fiber industry. The Association's membership is comprehensive with

eighteen members accounting for more than 90 percent of the U.S.

production of synthetic and cellulosic fiber. The Association's

basic policy is to oppose the proliferation of generic fiber names,

except where there is a clear and compelling rationale--which we

believe exists in the case of lyocell.\12\

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\12\ American Fiber Manufacturers Association, Inc. (24) p.1.

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B. Analysis

The Commission has considered the comments and all other

information available to it in this matter. It concludes that, as a

result of its physical characteristics and mode of manufacture,

``lyocell'' fiber is a subclass of generic ``rayon'' with significant

distinctions to consumers (e.g., washability). The Commission further

concludes that it is in the public interest to amend Rule 7(d) to

define the ``lyocell'' subclass and to allow use of the name

``lyocell'' as an alternative to the generic name ``rayon'' for that

subclass of fiber.

The temporary designation ``CF0001'' previously assigned

Courtaulds' fiber for temporary use is hereby revoked as of the

effective date of this amendment.

III. Regulatory Flexibility Act

In publishing the proposed amendment, the Commission certified,

subject to subsequent public comment, that the proposed amendment, if

promulgated, would not have a significant economic impact on a

substantial number of small entities and, therefore, that the

provisions of the Regulatory Flexibility Act,\13\ requiring

[[Page 16387]]

an initial regulatory analysis, did not apply.\14\ In considering the

economic impact of the proposed amendment on manufacturers and

retailers, the Commission noted that the amendment would impose no

obligations, penalties or costs, in part because the amendment simply

provides an additional, alternative method of complying with existing

rules. Use of the new alternative is voluntary. The Commission

nonetheless requested comment on the effects of the proposed amendment

on costs, profitability, competitiveness, and employment in small

entitles, in order not to overlook any substantial economic impact that

would warrant a final regulatory flexibility analysis.\15\

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\13\ 5 U.S.C. 605(b).

\14\ 60 FR 62352, 62354 (Dec. 6, 1995).

\15\ Id.

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Despite the explicit request by the Commission for comment on the

impact of the amendment on small entities, and the receipt of twenty-

seven comments from a variety of industry members, including the

association that represents the producers of over 90% of U.S. fiber, no

comments were received on this aspect of the rulemaking. The uniform

silence on this issue supports the Commission's tentative conclusion

contained in the Notice of Proposed Rulemaking. Accordingly, on the

basis of all the information before it, the Commission has determined

that the final amendment will not have a sufficiently significant

economic impact on a substantial number of small entities to warrant a

final regulatory flexibility analysis under the Regulatory Flexibility

Act. The notice serves as certification to that effect to the Small

Business Administration.

IV. Paperwork Reduction Act

This amendment does not constitute a ``collection of information''

under the Paperwork Reduction Act \16\ and the implementing regulations

of the Office of Management and Budget (``OMB'').\17\

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\16\ 44 U.S.C. 3501 et seq.

\17\ 5 CFR 1320.7(c).

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The generic name petition requests have already been submitted to

the OMB and have been assigned a control number, 3084-0047.

List of Subjects in 16 CFR Part 303

Labeling, Textiles, Trade practices.

PART 303--RULES AND REGULATIONS UNDER THE TEXTILE FIBER PRODUCTS

IDENTIFICATION ACT

Accordingly, after consideration of the views, arguments and data

submitted pursuant to the Notice of Proposed Rulemaking in this matter,

and in consideration of other pertinent information and material

available to the Commission, the Commission has determined to amend 16

CFR Part 303, Rules and Regulations under the Textile Fiber Products

Identification Act, in the manner set forth below:

1. The authority citation for Part 303 continues to read as

follows:

Authority: Sec. 7(c) of the Textile Fiber Products

Identification Act, 15 U.S.C. 70e(c); Sec. 553 of the Administrative

Procedure Act, 5 U.S.C. 553.

Sec. 303.7 [Amended]

2. Section 303.7(d), Generic Names and Definitions for Manufactured

Fibers, of 16 CFR Part 303 is hereby revised to read as follows:

Sec. 303.7 Generic names and definitions for manufactured fibers.

* * * * *

(d) Rayon--a manufactured fiber composed of regenerated cellulose,

as well as manufactured fibers composed of regenerated cellulose in

which substituents have replaced not more than 15% of the hydrogens of

the hydroxyl groups. Where the fiber is composed of cellulose

precipitated from an organic solution in which no substitution of the

hydroxyl groups takes place and no chemical intermediates are formed,

the term lyocell may be used as a generic description of the fiber.

* * * * *

By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 96-9274 Filed 4-12-96; 8:45 am]

BILLING CODE 6750-01-M