[Federal Register Volume 88, Number 171 (Wednesday, September 6, 2023)]
[Notices]
[Pages 60941-60943]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-19185]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request

AGENCY: Federal Trade Commission.

ACTION: Notice.

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SUMMARY: In accordance with the Paperwork Reduction Act of 1995 
(``PRA''), the Federal Trade Commission (``FTC'' or ``Commission'') is 
seeking public comments on its proposal to seek Office of Management 
and Budget (``OMB'') clearance for information collection requirements 
contained in the Federal Cigarette Labeling and Advertising Act, which 
requires the FTC to review plans for the rotation of health warnings on 
cigarette packaging and advertising. The proposed clearance request 
will be submitted to OMB for review following this opportunity for 
public comment. The current clearance expires on January 31, 2024, and 
the FTC intends to seek OMB renewal for three years.

DATES: Comments must be received on or before November 6, 2023.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write: ``Surgeon General's 
Cigarette Health Warnings: Paperwork Comment, FTC File No. P854505'' on 
your comment, and file your comment online at https://www.regulations.gov by following the instructions on the web-based 
form. If you prefer to file your comment on paper, mail your comment to 
the following address: Federal Trade Commission, Office of the 
Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), 
Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Shira Modell, General Attorney, 
Division of Advertising Practices, Bureau of Consumer Protection, (202) 
725-2162, <a href="/cdn-cgi/l/email-protection#d0a3bdbfb4b5bcbc90b6a4b3feb7bfa6"><span class="__cf_email__" data-cfemail="e99a84868d8c8585a98f9d8ac78e869f">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

A. Background

    The Federal Cigarette Labeling and Advertising Act, 15 U.S.C. 1331 
et seq. (2006 ed.) (``FCLAA''), prohibits cigarette manufacturers and 
importers from manufacturing, packaging, importing for sale, or 
distributing cigarettes within the United States unless the packages 
bear one of four statutorily-prescribed Surgeon General's health 
warnings. 15 U.S.C. 1333(a). Cigarette advertising by any of these 
entities must also bear statutorily-prescribed health warnings. Id. 
Section 1333(b) sets forth the location and format requirements for the 
health warnings on both packaging and advertising.
    The FCLAA further provides that the health warnings ``shall be 
rotated by each manufacturer or importer . . . quarterly in alternating 
sequence on packages of each brand of cigarettes manufactured by the 
manufacturer or importer and in the advertisements for each such brand 
of cigarettes in accordance with a plan submitted by the manufacturer 
or importer and approved by the Federal Trade Commission.'' 15 U.S.C. 
1333(c)(1).
    The FCLAA does provide an alternative to the requirement of 
quarterly rotation on cigarette packaging for manufacturers and 
importers whose sales satisfy two criteria.\1\ These manufacturers and 
importers can seek approval to display the Surgeon General's warnings 
on a particular cigarette brand style \2\ ``an equal number of times 
within the twelve-month period beginning on the date of the approval by 
the Commission of the application'' (hereinafter referred to as 
``equalization''). 15 U.S.C. 1333(c)(2)(C). In order to qualify for 
equalization, the sales of a manufacturer or importer must meet the 
following two criteria:
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    \1\ There is no comparable alternative to quarterly rotation for 
cigarette advertising.
    \2\ The statute defines ``brand style'' as ``a variety of 
cigarettes distinguished by the tobacco used, tar and nicotine 
content, flavoring used, size of the cigarette, filtration on the 
cigarette, or packaging.'' 15 U.S.C. 1332(8).

    (i) the number of cigarettes of such brand style sold in the 
fiscal year of the manufacturer or importer preceding the submission 
of the application is less than one-fourth of 1 percent of all the 
cigarettes sold in the United States in such year, and
    (ii) more than one-half of the cigarettes manufactured or 
imported by such manufacturer or importer for sale in the United 
States are packaged into brand styles which meet the requirements of 
clause (i).

    15 U.S.C. 1333(c)(2)(A). A manufacturer or importer can seek 
permission to equalize the display of the warnings on some of its brand 
styles, even if other brand styles do not qualify for equalization and 
are therefore subject to quarterly rotation.
    Pursuant to the FCLAA, cigarette manufacturers and importers submit 
plans to the Commission explaining how they intend to comply with the 
statutory requirement to display the Surgeon General's warnings on 
their packaging.\3\ If the company will be rotating the warnings on a 
quarterly basis, its plan must identify each of its brands and brand 
styles and include a schedule (or other explanation) showing the 
warning that will be assigned to each brand during each quarter of the 
year. The company must also specify when in the manufacturing process 
it will consult its rotation schedule for that particular brand in 
order to assign the appropriate quarterly warning.
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    \3\ Manufacturers and importers must also submit samples of 
actual packaging for any new cigarette brands or brand styles, or 
samples of new packaging for existing brands or brand styles. 
However, this requirement is not subject to clearance under the 
Paperwork Reduction Act (``PRA''). Such packaging samples do not 
constitute ``information'' for purposes of the PRA because they 
merely constitute ``samples of . . . physical objects.'' See 5 CFR 
1320.3(h)(2). Accordingly, the burden associated with the submission 
of any such samples is not reflected in the Commission's burden 
analysis below.
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    If the company wishes to use the option provided by section 
1333(c)(2) and display the four warnings an equal number of times 
during the year on the packaging of certain brand styles, its plan must 
provide information sufficient to show that its sales satisfy both of 
the criteria in 15 U.S.C. 1333(c)(2)(A). It must also explain how it 
will ensure that all four warnings will be equally displayed during the 
one-year period beginning on the date the plan is approved--for 
example, by using printing plates that produce an even number of all 
four warnings simultaneously on each print run. Finally, because the 
statute authorizes approval for equalization only for one year, see 15 
U.S.C. 1333(c)(2)(C), the

[[Page 60942]]

manufacturer or importer must submit a new plan annually demonstrating 
that its sales continue to qualify for equalization.
    Manufacturers and importers who intend to engage in advertising 
must provide the Commission with a rotation schedule for the four 
statutorily-prescribed warnings for each brand they intend to 
advertise. They also must provide an example of each of the warning 
statement formats they will use, which vary based on the size of their 
advertisement,\4\ and specify how they will determine which warnings 
will appear on different kinds of advertisements and how they will 
handle advertisements that feature more than one of the company's 
brands.
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    \4\ The formats and sizes of the warnings that the Commission 
uses to enforce the requirements for advertisements are set forth in 
acetate exhibits. Electronic versions of the acetates with the 
required warning statement formats are available on the Commission's 
website.
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    Since the information collection is statutorily prescribed, the 
need for OMB clearance was not necessarily apparent.\5\ Nonetheless, 
the FTC recently decided to obtain OMB clearance for this statutorily-
mandated information collection. Accordingly, on July 28, 2023, the FTC 
obtained OMB's approval of an expedited provisional clearance for this 
information collection (OMB Control Number: 3084-0175, Title: 
Information Collection under the Federal Cigarette Labeling and 
Advertising Act), and, under 5 CFR 1320.13(d), a waiver of the 
requirement to publish a notice of the emergency clearance request. As 
required by section 3506(c)(2)(A) of the PRA, the FTC is providing this 
opportunity for public comment before submitting the information 
collection to OMB for its nonprovisional clearance.
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    \5\ An agency's failure to obtain OMB clearance for a 
statutorily-mandated information collection requirement does not 
appear to excuse a respondent's failure to comply with the 
requirement. Accord 5 CFR 1320.6(e) (establishing that, for purposes 
of information collection requirements that are imposed by statute, 
an agency's failure to comply with the requirements of the PRA does 
not amount to a defense against the assessment of a penalty); U.S. 
v. Ionia Management S.A., 498 F. Supp. 2d 477, 489 (D. Conn. 2007) 
(discussing that, for purposes of information collection 
requirements that are imposed by statute, an agency's failure to 
comply with the requirements of the PRA does not excuse a person's 
failure to comply with the requirement).
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B. Burden Statement

    Affected Public: Private Sector: Businesses and other for-profit 
entities.
    Estimated Annual Burden Hours: 336.
    Estimated Annual Labor Costs: $23,382.
    Estimated Annual Non-Labor Costs: $0.

I. Estimated Burden Hours

    FTC staff's estimate of the burden hours is based on the time 
required for an applicant to prepare a plan seeking the Commission's 
approval for display of the Surgeon General's health warnings on its 
packages and advertising (assuming it plans to engage in advertising). 
During the period from 2020 to 2022, the Commission approved a total of 
124 plans. In 2022, all 44 of the plans approved by the Commission 
included a request for equalization of the warning labels on at least 
some brand styles, and thus, the submission of sales information for 
those brand styles.
    Manufacturers and importers who are approved for quarterly rotation 
of the warnings on their packaging do not have to submit new plans 
unless and until they intend to add new brands or brands styles or new 
types of advertising to their existing plans. As explained above, 
manufacturers and importers that are approved to use the alternative to 
quarterly rotation on their packaging must refile each year so the 
Commission can assess whether they remain eligible to equalize the 
warnings. They also must file new plans if they add new brands or brand 
styles to their existing plans; once the company has obtained approval 
for its initial plan, however, it should need less time in subsequent 
years to prepare those updates. Moreover, the sales information 
required to prove eligibility for the alternative to quarterly rotation 
is readily available to the applicant.
    FTC staff recognizes that preparation of a plan by a manufacturer 
or importer that has not previously submitted one will take somewhat 
more time than either preparation of essentially the same plan with 
updated sales figures in subsequent years, or preparation of a very 
similar plan that modifies a previously-approved plan (e.g., adding new 
brand styles). However, plans can be short (e.g., 2-page) letters, and 
numerous examples of plans already approved by the Commission are 
available on the Commission's website. Thus, as an approximation, FTC 
staff believes that, on average, each submission will take respondents 
8 hours to prepare and submit. As FTC staff receives, on average, 42 
responses related to the FCLAA's information collection requirements 
per year, this yields an annual burden of 336 hours (42 responses x 8 
hours per response).

2. Estimated Annual Labor Costs

    FTC staff's experience is that most of the plans it receives are 
submitted by, or on behalf of, relatively small companies (as evidenced 
by the fact that all of the plans received in 2022 included requests 
for label equalization). Roughly half of the plans are submitted by 
non-legal company personnel, the other half by attorneys. FTC staff is 
assuming an average $69.59/hour wage, based on mean hourly wages listed 
by the U.S. Bureau of Labor Statistics 2022 Occupational Employment and 
Wage Statistics for lawyers ($80.11) and general and operations 
managers ($59.07).\6\ Using this figure, this yields a burden of 
$23,382 per year (336 hours x $69.59).
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    \6\ This is derived from the average of the U.S. Bureau of Labor 
Statistics Occupational Employment and Wage Statistics (May 2022) 
hourly wages for lawyers/legal services ($80.11) and general and 
operations managers ($59.07), as roughly half of the plans submitted 
to the Commission are signed by attorneys and half by non-attorneys. 
https://www.bls.gov/oes/current/oes_stru.htm (Tables 23-1011, 11-
1021).
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3. Estimated Annual Non-Labor Costs

    FTC staff believes that the capital or other non-labor costs 
associated with the information requests are minimal.

C. Request for Comment

    Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites 
comments on: (1) whether the disclosure and recordkeeping requirements 
are necessary, including whether the information will be practically 
useful; (2) the accuracy of our burden estimates, including whether the 
methodology and assumptions used are valid; (3) ways to enhance the 
quality, utility, and clarity of the information to be collected; and 
(4) ways to minimize the burden of the collection of information.
    For the FTC to consider a comment, we must receive it on or before 
November 6, 2023. Your comment, including your name and your state, 
will be placed on the public record of this proceeding, including the 
https://www.regulations.gov website.
    If you file your comment on paper, write ``Surgeon General's 
Cigarette Health Warnings: Paperwork Comment, FTC File No. P854505'' on 
your comment and on the envelope, and mail it to the following address: 
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania 
Avenue NW, Suite CC-5610 (Annex J), Washington, DC 20580.
    Because your comment will become publicly available at https://www.regulations.gov, you are solely responsible for making sure that 
your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone

[[Page 60943]]

else's Social Security number; date of birth; driver's license number 
or other state identification number, or foreign country equivalent; 
passport number; financial account number; or credit or debit card 
number. You are also solely responsible for making sure that your 
comment does not include any sensitive health information, such as 
medical records or other individually identifiable health information. 
In addition, your comment should not include any ``trade secret or any 
commercial or financial information which . . . is privileged or 
confidential''--as provided by section 6(f) of the FTC Act, 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including, in 
particular, competitively sensitive information, such as costs, sales 
statistics, inventories, formulas, patterns, devices, manufacturing 
processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must (1) be filed in paper form, (2) be clearly labeled 
``Confidential,'' and (3) comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted publicly at www.regulations.gov, we cannot redact or remove 
your comment unless you submit a confidentiality request that meets the 
requirements for such treatment under FTC Rule 4.9(c), and the General 
Counsel grants that request.
    The FTC Act and other laws that the Commission administers permit 
the collection of public comments to consider and use in this 
proceeding as appropriate. The Commission will consider all timely and 
responsive public comments that it receives on or before November 6, 
2023. For information on the Commission's privacy policy, including 
routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Josephine Liu,
Assistant General Counsel for Legal Counsel.
[FR Doc. 2023-19185 Filed 9-5-23; 8:45 am]
BILLING CODE 6750-01-P


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