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10403
Proposed Rules Federal Register
Vol. 73, No. 39
Wednesday, February 27, 2008
This section of the FEDERAL REGISTER by courier or overnight service, if comparisons of amplifier performance
contains notices to the public of the proposed possible, because postal mail in the attributes.
issuance of rules and regulations. The Washington area and at the Commission
purpose of these notices is to give interested II. Regulatory Review of the Amplifier
is subject to delay due to heightened
persons an opportunity to participate in the Rule
security precautions.
rule making prior to the adoption of the final Comments filed in electronic form The Commission reviews each of its
rules. rules and guides periodically to assess
should be submitted by following the
instructions on the web-based form at the rule’s or guide’s efficacy, costs, and
https://secure.commentworks.com/ftc- benefits; and to determine whether to
FEDERAL TRADE COMMISSION
AmplifierRuleReview. To ensure that the retain, modify, or rescind it. This notice
16 CFR Part 432 Commission considers an electronic commences the Commission’s review of
comment, you must file it on that web- the Amplifier Rule.
Trade Regulation Rule Relating to based form. You may also visit http:// A. General Areas of Interest for FTC
Power Output Claims for Amplifiers www.regulations.gov to read this notice, Review
Utilized in Home Entertainment and may file an electronic comment
Products through that website. The Commission As part of its review, the Commission
will consider all comments that seeks comment on a number of general
AGENCY: Federal Trade Commission. www.regulations.gov forwards to it. issues, including the continuing need
ACTION: Request for public comment. The FTC Act and other laws the for the Rule and its economic impact.
Commission administers permit the The Commission believes that this
SUMMARY: The Federal Trade review is important to ensure that the
collection of public comments to
Commission (‘‘FTC’’ or ‘‘Commission’’) consider and use in this proceeding as Rule is appropriately responsive to
requests public comment on its Trade appropriate. The Commission will changes in the marketplace.
Regulation Rule Relating to Power consider all timely and responsive
Output Claims for Amplifiers Utilized B. Specific Areas of Interest for FTC
public comments that it receives, Review
in Home Entertainment Products whether filed in paper or electronic
(‘‘Amplifier Rule’’ or ‘‘Rule’’). The form. Comments received will be After its last revisions to the Rule in
Commission solicits comment as part of available to the public on the FTC 2000, the Commission issued a
its systematic review of all current FTC website, to the extent practicable, at Supplemental Notice of Proposed
rules and guides. http://www.ftc.gov. As a matter of Rulemaking (‘‘SNPR’’) soliciting
DATES: Written comments relating to the discretion, the FTC makes every effort to comment on Commission proposals to
Amplifier Rule review must be received remove individuals’ home contact amend the definition of ‘‘associated
by May 12, 2008. information from the public comments channels’’ in connection with the power
it receives before placing those rating testing of multichannel ‘‘home
ADDRESSES: Interested parties are
comments on the FTC website. To read theater’’ amplifiers (65 FR 80798
invited to submit written comments
our policy on how we handle the (2000)). Multichannel amplifiers
relating to the Amplifier Rule review.
information you submit—including incorporate five or more amplification
To facilitate organization of comments,
routine uses permitted by the Privacy channels and are designed to decode
comments should refer to ‘‘Amplifier
Act—please review the FTC’s privacy and/or amplify digitally encoded
Rule Regulatory Review, 16 CFR Part
policy, at http://www.ftc.gov/ftc/ multichannel movie soundtracks or
432, Comment, Project No. P974222.’’ A
privacy.shtm. music. Section 432.2(a) of the Rule
comment filed in paper form should
requires an amplifier’s continuous
include this reference both in the text FOR FURTHER INFORMATION CONTACT: Jock power output per channel to be
and on the envelope, and should be Chung, Attorney, 202-326-2984, ‘‘[m]easured with all associated
mailed or delivered to the following Division of Enforcement, Bureau of channels fully driven to rated per
address: Federal Trade Commission/ Consumer Protection, Federal Trade channel power.’’2 Thus, manufacturers
Office of the Secretary, Room H-135 Commission.
(Annex E), 600 Pennsylvania Avenue, of multichannel audio/video receivers
N.W., Washington, D.C. 20580. SUPPLEMENTARY INFORMATION: and amplifiers must decide which of the
Comments containing confidential five or more discrete channels of
I. Background
material must be filed in paper form, amplification are ‘‘associated’’ and,
In response to misleading or therefore, subject to simultaneous
must be clearly labeled ‘‘Confidential,’’ confusing power distortion and other
and must comply with Commission operation at full rated power. In its
performance claims, the Commission SNPR, the Commission solicited public
Rule 4.9(c).1 The FTC is requesting that issued the Amplifier Rule in 1974 to comment on three alternative
any comment filed in paper form be sent assist consumers purchasing power designations of ‘‘associated channels’’
1 The comment must be accompanied by an
amplification equipment for home for such audio amplifiers.3
entertainment purposes by
ebenthall on PRODPC61 with PROPOSALS
explicit request for confidential treatment,
including the factual and legal basis for the request, standardizing the measurement and 2 This continuous measurement represents the
and must identify the specific portions of the disclosure of various amplifier maximum per-channel power an amplifier can
comment to be withheld from the public record. performance characteristics (39 FR deliver over a five minute period.
The request will be granted or denied by the 3 The three proposed alternatives were: (1) all
Commission’s General Counsel, consistent with
15387). The Rule establishes uniform channels associated as one group; (2) the front right
applicable law and the public interest. See test standards and disclosures to aid and left channels and the center channel associated
Commission Rule 4.9(c), 16 CFR 4.9(c). consumers in making meaningful Continued
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10404 Federal Register / Vol. 73, No. 39 / Wednesday, February 27, 2008 / Proposed Rules
The SNPR elicited one comment, reference to the question being (b) How would these modifications
submitted by the Consumer Electronics answered, and reference to empirical affect the costs and benefits of the
Association (‘‘CEA’’). CEA noted that data or other evidence wherever Rule for consumers?
there was no industry consensus on available and appropriate. (c) How would these modifications
testing, measuring, and specifying the affect the costs and benefits of the
A. General Issues
power output of multichannel amplifier Rule for businesses?
products. Consequently, CEA formed an (1) Is there a continuing need for the (11) What significant costs, including
industry working group to establish a Rule? Why or why not? costs of compliance, has the Rule
voluntary industry standard. (2) What benefits has the Rule provided imposed on businesses, and in
On January 15, 2002, at the request of to consumers? What evidence supports particular on small businesses? What
CEA, the Commission deferred action the asserted benefits? evidence supports the asserted costs?
on the proposed rule to allow a (3) What modifications, if any, should (12) What modifications, if any, should
consensus procedure for the testing of be made to the Rule to increase its be made to the Rule to reduce the costs
multichannel amplifiers to develop (67 benefits to consumers? imposed on businesses, and in
FR 1915). Although CEA subsequently (a) What evidence supports your particular on small businesses?
issued a standard, designated CEA-490- proposed modifications? (a) What evidence supports your
A, ‘‘Test Methods of Measurement for (b) How would these modifications proposed modifications?
Audio Amplifiers,’’4 the Commission’s affect the costs and benefits of the (b) How would these modifications
review did not find widespread Rule for consumers? affect the costs and benefits of the
adoption of this standard in (c) How would these modifications Rule for consumers?
advertisements or product affect the costs and benefits of the (c) How would these modifications
specifications. Rule for businesses, and in particular affect the costs and benefits of the
With no universally adopted power small businesses? Rule for businesses?
rating standard for multichannel (4) What impact has the Rule had on the (13) What evidence is available
amplifiers, the Commission was faced flow of truthful information to concerning the degree of industry
with the prospect of making a regulatory consumers and on the flow of deceptive compliance with the Rule?
decision affecting a growing market for information to consumers? (a) To what extent has there been a
‘‘home theaters’’ based on an outdated (5) What significant costs has the Rule reduction in deceptive home
record. Consequently, the Commission imposed on consumers? What evidence entertainment amplifier power rating
terminated its rulemaking on March 20, supports the asserted costs? claims since the Rule was issued?
2007, stating that the rulemaking record (6) What modifications, if any, should Please provide any supporting
was insufficient for further regulatory be made to the Rule to reduce the costs evidence. Does this evidence indicate
decisions (72 FR 13052). imposed on consumers? that the Rule should be modified? If
However, when it terminated the (a) What evidence supports your so, why, and how? If not, why not?
rulemaking, the Commission stated that proposed modifications? (b) To what extent has the Rule
it would place the Amplifier Rule on its (b) How would these modifications reduced marketers’ uncertainty about
regulatory review schedule for 2008, affect the costs and benefits of the which claims might lead to FTC law
during which it would solicit comments Rule for consumers? enforcement actions? Please provide
to determine what, if any amendments (c) How would these modifications any supporting evidence. Does this
are appropriate to address the testing of affect the costs and benefits of the evidence indicate that the Rule
multichannel amplifiers. Some of the Rule for businesses, and in particular should be modified? If so, why, and
questions included in this notice, small businesses? how? If not, why not?
therefore, address issues regarding the (7) Please provide any evidence that has (14) Are there claims addressed in the
usage of multichannel ‘‘home theater’’ become available since 2000 concerning Rule on which regulation is no longer
amplifiers by consumers, and the costs consumer perception of home needed? If so, explain. Please provide
and benefits of requiring different entertainment amplifier power rating supporting evidence.
methodologies for rating the power claims, including claims not currently (15) What potentially unfair or
output of multichannel ‘‘home theater’’ covered by the Rule. Does this new deceptive home entertainment amplifier
amplifiers. By including these issues, information indicate that the Rule power rating claims, if any, are not
the Commission intends to facilitate should be modified? If so, why, and covered by the Rule?
comment, and the inclusion, or how? If not, why not? (a) What evidence demonstrates the
exclusion, of any issue is no indication (8) Please provide any evidence that has existence of such claims?
of the Commission’s intent to make any become available since 2000 concerning (b) With reference to such claims,
specific modifications to the Rule. consumer interest in particular home should the Rule be modified? If so,
III. Issues for Comment entertainment amplifier power rating why, and how? If not, why not?
issues. Does this new information (16) What modifications, if any, should
The Commission requests written indicate that the Rule should be be made to the Rule to account for
comment on any or all of the following modified? If so, why, and how? If not, changes in relevant technology or
questions. Please make your responses why not? economic conditions? What evidence
as specific as possible, including a (9) What benefits, if any, has the Rule supports the proposed modifications?
provided to businesses, and in (17) Does the Rule overlap or conflict
as one group, and the surround channels associated particular to small businesses? What with other federal, state, or local laws or
as a second group; and (3) the front stereo channels
evidence supports the asserted benefits? regulations? If so, how?
ebenthall on PRODPC61 with PROPOSALS
associated as one group, the center channel treated
as a second group, and the surround channels (10) What modifications, if any, should (a) What evidence supports the
associated as a third group. be made to the Rule to increase its asserted conflicts?
4 Copies of the test procedures may be obtained
benefits to businesses, and in particular (b) With reference to the asserted
for a fee from IHS Inc., 15 Inverness Way East,
Englewood, CO 80112, or online from http://
to small businesses? conflicts, should the Rule be
global.ihs.com/doc_detail.cfm?item_s_key= (a) What evidence supports your modified? If so, why, and how? If not,
00033449&item_key_date=970530&rid=CEA. proposed modifications? why not?
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Federal Register / Vol. 73, No. 39 / Wednesday, February 27, 2008 / Proposed Rules 10405
(c) Is there evidence concerning (8) Should Consumer Electronics provision of services to employee
whether the Rule has assisted in Association protocol CEA-490-A be benefit plans. The proposed regulation
promoting national consistency with incorporated into the Rule? Why or why would provide that a ‘‘reasonable’’
respect to the regulation of home not? What evidence supports your contract or arrangement under ERISA
entertainment amplifier power rating answer? section 408(b)(2) 1 between an employee
claims? If so, please provide that benefit plan and certain service
evidence. (9) Do current or impending changes in providers must include, among other
(18) Are there international laws, technology, such as the development of things, certain disclosures concerning
regulations, or standards with respect to self-powered wired and wireless service provider compensation and
home entertainment amplifier power speakers, affect whether and how the conflicts of interest.2
rating claims that the Commission Rule should be modified regarding Specifically, upon adoption, the
should consider as it reviews the Rule? power rating protocols for multichannel proposal would require contracts and
If so, what are they? Should the Rule be ‘‘home theater’’ amplifiers? arrangements between employee benefit
modified in order to harmonize with plans and certain providers of services
List of Subjects in 16 CFR Part 432
these international laws, regulations, or to such plans to be in writing and to
standards? If so, why, and how? If not, Amplifiers, Home entertainment include provisions to ensure certain
why not? products, Trade practices. disclosures to enable the plan fiduciary
(19) Do current or impending changes in Authority: 15 U.S.C. 41-58. to assess the reasonableness of
technology affect whether and how the By direction of the Commission. compensation or fees that the service
Rule should be modified? provider would receive (from the plan
Donald S. Clark,
B. Specific Issues and third parties) in connection with
Secretary services rendered to the plan. The
(1) Should the Rule be revised to [FR Doc. E8–3715 Filed 2–26–08: 8:45 am] disclosures are also designed to enable
include additional guidance regarding [BILLING CODE 6750–01–S] the plan fiduciary to evaluate potential
power ratings for multichannel ‘‘home conflicts of interest that may affect the
theater’’ amplifiers? If so, why, and service provider’s performance under
what guidance should be provided? If DEPARTMENT OF LABOR the contract or arrangement.
not, why not? What evidence supports In the notice of proposed regulation,
your answer(s)? Employee Benefits Security the Department invited all interested
(2) What methods are currently used to Administration persons to submit written comments on
measure the power outputs of or before February 11, 2008. To date, the
multichannel ‘‘home theater’’ 29 CFR Part 2550 Department has received approximately
amplifiers? Does use of these methods 90 written comments on the proposal,
cause consumer injury? What evidence Hearing on Reasonable Contracts or
Arrangements Under Section many of which were from major
supports your answer(s)? industry groups and plan fiduciaries.
(3) How often during typical usage, i.e., 408(b)(2)—Fee Disclosure
All written comments are available to
for what percentage of usage time, are AGENCY: Employee Benefits Security the public, without charge, online at
multichannel ‘‘home theater’’ amplifiers Administration, U.S. Department of http://www.dol.gov/ebsa and at the
required to produce full rated output in Labor. Public Disclosure Room, N–1513,
all channels simultaneously? What ACTION: Notice of hearing. Employee Benefits Security
evidence supports your answer? Administration, U.S. Department of
(4) How often during typical usage, i.e., SUMMARY: Notice is hereby given that Labor, 200 Constitution Avenue, NW.,
for what percentage of usage time, are the Department of Labor will hold a Washington, DC 20210.
multichannel ‘‘home theater’’ amplifiers hearing on the Department’s proposed In addition, the Department published
required to produce full rated output in regulation under section 408(b)(2) of the in the Federal Register on December 13,
the three front channels Employee Retirement Income Security 2007 (72 FR 70893), a notice of
simultaneously? What evidence Act of 1974 (ERISA) and the related proposed class exemption that would
supports your answer? proposed class exemption. provide relief from certain prohibited
(5) What are the incremental effects on DATES: The hearing will be held on transaction restrictions of ERISA. The
power ratings for multichannel ‘‘home March 20, 2008, and March 21 (if proposed class exemption would relieve
theater’’ amplifiers of driving two, three, necessary), beginning at 9 a.m., EST. the responsible plan fiduciary from any
four, five, six, or more channels liability for a prohibited transaction that
ADDRESSES: The hearing will be held at
simultaneously? What evidence would result from entering into a
supports your answers? the U.S. Department of Labor, Room S–
4215 A–C, 200 Constitution Avenue, contract or arrangement for the
(6) For a given rated power output, e.g.,
NW., Washington, DC 20210. provision of services when the service
100 Watts per channel, what is the
FOR FURTHER INFORMATION CONTACT: Fil provider failed to comply with the
added cost of producing a multichannel
‘‘home theater’’ amplifier that can Williams, Office of Regulations and
1 Section 408(b)(2) of ERISA provides relief from
provide full rated power in all channels Interpretations, Employee Benefits the prohibited transaction rules for service contracts
simultaneously rather than in only one Security Administration, (202) 693– or arrangements between a plan and a party in
channel? What evidence supports your 8510. This is not a toll-free number. interest if the contract or arrangement is reasonable,
SUPPLEMENTARY INFORMATION: On the services are necessary for the establishment or
answer? operation of the plan, and no more than reasonable
(7) Should the Rule require that any December 13, 2007, notice was
ebenthall on PRODPC61 with PROPOSALS
compensation is paid for the services. Regulations
channels be designated as associated published in the Federal Register (72 issued by the Department clarify each of these
when testing the power output of FR 70988) that the Department of Labor conditions to the exemption. See 29 CFR
multichannel ‘‘home theater’’ (the Department) has under § 2550.408b–2.
2 Currently, the regulation at 29 CFR § 2550.408b–
amplifiers? If so, which channels should consideration a proposal to amend its 2(c) states only that a contract or arrangement is not
be designated as associated? What regulation 29 CFR 2550.408b–2(c) under reasonable unless it permits the plan to terminate
evidence supports your answer? ERISA section 408(b)(2) relating to the without penalty on reasonably short notice.
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