New business opportunity rules slowly grind to finalization.(Legal Review)(rules for busineses)

Response, July, 2006 by Hailey, Gary D.; Knowles, Jeffrey D.

Ever hear the old saying: "The wheels of justice grind slowly, but they grind exceedingly fine?" The "slowly" part of that saying certainly applies to the Federal Trade Commission's (FTC) business opportunity rulemaking proceeding. However, few of the marketers whose conduct will be governed by this rule view it as an "exceedingly fine" idea.

For years, most business opportunity sellers have been able to avoid the heavy regulatory burden imposed by the FTC's Franchise Rule (which became effective in 1978)--usually by charging customers less than $500. In 1997, the FTC called for public comments on the desirability of a new regulation applying to business opportunities generally. After mulling everything over for the better part of a decade, the Commission has...

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