Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC Proposes To Retain Cooling-Off Rule for Door-To-Door Sales, Raise Exclusionary Limit to $130, (Jan 16, 2013)
By Tobias J. Gillett, J.D., LLM.
The FTC will seek comment on its intentions to retain its Trade Regulation Rule Concerning Cooling-Off Period for Sales Made at Homes or at Certain Other Locations (Cooling-Off Rule) and to raise the exclusionary limit under the rule to $130. The proposed amendment and request for public comment will be published in the Federal Register on January 17, 2013.
The Cooling-Off Rule currently requires door-to-door sellers of consumer goods and services with a purchase price of $25 or more to provide buyers with a receipt, or a copy of the sales contract, containing a notice setting forth the buyer’s right to cancel the deal within three days, as well as a completed form the buyer can use to terminate the transaction. The seller must honor the cancellation within ten days by refunding all payments, returning or canceling any security interests or traded-in property, and notifying the buyer of its intent to repossess or abandon any shipped or delivered goods. The Rule makes failure to comply with these provisions an unfair and deceptive act or practice.
The FTC reviewed the Cooling-Off Rule pursuant to its policy of systematically reviewing all of its current regulations and industry guides. Following a comment period commenced in April 2009, the FTC concluded that its continued value in protecting consumers from unfair and deceptive transactions, particularly those resulting from high-pressure sales tactics, warranted its further retention.
However, the Rule was promulgated on October 26, 1972, and was last amended on October 20, 1995. The FTC determined that an increase in the exclusionary limit from $25 to $130 would account for inflation, and appropriately balance the costs of compliance with the benefits to consumers.
Comments on the proposed actions can be filed by labeling the comment with “Cooling-Off Rule Regulatory Review, 16 CFR 429, Comment, Project No. P087109” and submitting it through the FTC’s online form at https://ftcpublic.commentworks.com/ftc/coolingoffproposedamend, or by mailing or delivering it to Federal Trade Commission, Office of the Secretary, Room H-113 (Annex C), 600 Pennsylvania Avenue, NW, Washington, DC 20580. Comments must be received no later than March 4, 2013.
News: ConsumerProtection FederalTradeCommissionNews