Source: https://regulations.vlex.com/vid/cfr-part-382600310
Timestamp: 2020-02-17 14:03:44
Document Index: 260369017

Matched Legal Cases: ['art 23', 'art 23', 'art 23', 'art 17', 'art 23', 'art 23']

16 CFR Part 23 - July 02, 2012 - Regulations - VLEX 382600310
Pages 39201-39205
FR Doc No: 2012-16119
AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').
ACTION: Guides; request for public comments.
SUMMARY: The Commission systematically reviews all of its current rules and guides to ensure that they continue to achieve their intended purpose without unduly burdening commerce. As part of this review, the Commission requests public comments on the overall costs, benefits, necessity,
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regulatory and economic impact of, and possible modifications to, the FTC's Guides for the Jewelry, Precious Metals, and Pewter Industries.
DATES: Comments must be received on or before August 27, 2012.
ADDRESSES: Interested parties may file comments online or on paper by following the instructions in the Request for Comments part of the SUPPLEMENTARY INFORMATION section below. Write ``Jewelry Guides, 16 CFR Part 23, Project No. G711001'' on your comment, and file your comment online at https://ftcpublic.commentworks.com/ftc/jewelryguidesreview by following the instructions on the web-based form. If you prefer to file your comment on paper, mail or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Room H-113 (Annex O), 600 Pennsylvania Avenue NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT: Reenah L. Kim, Attorney, (202) 326-
2272, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW., Washington, DC 20580.
The Guides for the Jewelry, Precious Metals, and Pewter Industries (``Jewelry Guides'' or ``Guides'') address claims made about precious metal, pewter, diamond, gemstone, and pearl products. 16 CFR part 23. The Guides explain how to avoid making deceptive claims and, for certain products, discuss when disclosures should be made to avoid unfair or deceptive trade practices.\1\
\1\ The Commission issues industry guides to help the industry conduct its affairs in conformity with legal requirements. 16 CFR part 17. Industry guides are administrative interpretations of the law; they do not have the force of law and are not independently enforceable. Failure to follow industry guides may result, however, in enforcement action under the FTC Act, 15 U.S.C. 45. In any such action, the Commission must prove that the act or practice at issue is unfair or deceptive in violation of Section 5 of the FTC Act.
The Commission completed its last comprehensive review of the Jewelry Guides in 1996, and has modified the Guides four times since. As a result of the 1996 review, the Commission: consolidated certain provisions of the former Watch Band Guides with the Jewelry Guides; added new provisions, such as those regarding use of the terms vermeil and pewter, and the disclosure of certain treatments to diamond and gemstone jewelry products; and eliminated or substantively revised several existing provisions.\2\ Additionally, in 1997, the Commission revised Section 7 of the Guides regarding platinum products, to simplify and align its guidance more closely with international standards.\3\ In 1999, the Commission amended the Guides to remove a footnote reference to the Watch Guides, which it had rescinded earlier.\4\ In response to petitions from jewelry trade associations, the Commission again revised the Guides in 2000 to provide for disclosure of permanent gemstone treatments that significantly affect the value of the gemstone, such as the laser-drilling of diamonds.\5\ In 2010, the Commission amended Section 7 regarding platinum to provide guidance on how to mark and describe non-deceptively certain platinum alloys.\6\
\2\ Federal Trade Commission: Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry: Final guides, 61 FR 27178 (May 30, 1996). As part of these changes, the industry guides formerly known as ``Guides for the Jewelry Industry'' were renamed ``Guides for the Jewelry, Precious Metals, and Pewter Industries.''
\3\ Federal Trade Commission: Guides for the Jewelry, Precious Metals, and Pewter Industries: Final guides, 62 FR 16669 (Apr. 8, 1997).
\4\ Federal Trade Commission: Guides for the Jewelry, Precious Metals, and Pewter Industries: Revision of the Guides for the Jewelry, Precious Metals, and Pewter Industries, 64 FR 33193 (June 22, 1999).
\5\ Federal Trade Commission: Guides for the Jewelry, Precious Metals, and Pewter Industries: Final guides, 65 FR 78738 (Dec. 15, 2000).
\6\ Federal Trade Commission: Guides for the Jewelry, Precious Metals, and Pewter Industries: Final Guides Amendments, 75 FR 81443 (Dec. 28, 2010).
Since 1992, the Commission has systematically reviewed all its regulations and guides to ensure that they continue to achieve their intended goals without unduly burdening commerce. The Commission schedules its regulations and guides for review on a ten-year cycle; i.e., all rules and guides are scheduled to be reviewed ten years after implementation and ten years after the completion of each review. The Commission publishes this schedule annually, with adjustments in response to public input, changes in the marketplace, and resource demands.\7\
\7\ Since completing its last review of the Jewelry Guides in 1996, the Commission revised sections of the Guides and addressed other issues raised in petitions from jewelry trade associations. The Commission therefore scheduled the Guides for another comprehensive review in 2011, but postponed it due to resource constraints. Federal Trade Commission: Notice Announcing Ten-Year Regulatory Review Schedule and Request for Public Comment on the Federal Trade Commission's Regulatory Review Program, 76 FR 41150 (Jul. 13, 2011).
When the Commission reviews a rule or guide, it publishes a notice in the Federal Register seeking public comments on the continuing need for the rule or guide, as well as its costs and benefits to consumers and businesses. Based on this feedback, the Commission may modify or repeal the rule or guide to address public concerns or changed conditions, or to reduce undue regulatory burden. As part of this review process, the Commission now solicits comments on, among other things: The regulatory and economic impact of, and the continuing need for, the Jewelry Guides; the benefits of the Guides to businesses and consumers; the burdens the Guides place on businesses; possible conflict between the Guides and state, local, or other federal laws; and the effect on the Guides of any technological, economic, or other industry changes.\8\
\8\ See questions 1 through 12 in Section IV below.
First, the increased marketing of stones comprising a mixture of ruby/corundum and lead-glass has raised issues concerning how such products are advertised and sold. These composite stones (which are sometimes referred to as ``composite rubies,'' ``hybrid rubies,'' or ``glass-filled rubies'') may contain a considerable percentage of lead-
glass. Moreover, the method that produces these stones may differ significantly from the techniques traditionally used to treat or enhance natural rubies (e.g., various treatments involving the application of heat). Informal inquiries received by staff have questioned whether a lead-glass-filled composite stone can accurately be identified as a natural ruby or gem, even when disclosures are made that the stone has been treated. The Commission seeks comments on whether it should amend the Guides to address this development and, if so, how.
Second, the current Guides do not specifically address use of the term ``cultured'' to describe industry products created in a laboratory or factory that have essentially the same optical, physical, and chemical properties of natural gemstones. In connection with petitions submitted by
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several jewelry industry trade groups in 1986 and 2006, the Commission considered proposals to amend the Guides to state that it is deceptive or unfair to describe such products as ``cultured.'' After reviewing the record, the Commission determined there was insufficient evidence to conclude that using ``cultured'' in reference to laboratory-created diamonds or other laboratory-created gemstones would be either deceptive or unfair if marketers reasonably and effectively qualified the term as suggested in Section 23.23.\9\ The Commission now seeks additional evidence on this issue.
\9\ See FTC letter of July 21, 2008 declining to amend the Guides with respect to use of the term ``cultured,'' available at http://www.ftc.gov/os/2008/07/G711001jewelryguides.pdf.
Third, the Commission seeks comments regarding several issues relating to pearls. Specifically, the Commission seeks comments on whether it should amend the Guides to address disclosures concerning freshwater pearls. Comments submitted in the 1996 review suggested that use of the term ``cultured'' in reference to freshwater pearls would create confusion because consumers tended to associate the term ``cultured pearls'' with pearls that were round, and freshwater pearls were often irregularly-shaped and smaller than other cultured pearls. Since then, developments in the culturing process have effected changes in the shape, size, quality, and color of the resulting product, such that freshwater cultured pearls may, in many respects, resemble saltwater cultured pearls in appearance. The Commission thus seeks comments on whether it should amend the Guides to recommend any specific disclosures relating to freshwater pearls. In addition, the Commission seeks comments on whether the Guides should advise the disclosure of treatments to pearl products, such as dyeing techniques that artificially color the final product.
Fourth, the Commission seeks comments on whether the Guides should provide particular guidance on how to describe non-deceptively the content of alloys and alloy products that contain precious metals in amounts that fall below the minimum thresholds reflected in the current Guides. Specifically, Section 23.4 provides that it may be misleading to use the word gold or any abbreviation, or a quality mark implying gold content, to describe all or part of an industry product that is composed throughout of an alloy of gold that is less than 10 karats. Similarly, Section 23.6 provides that it is unfair or deceptive to mark, describe, or otherwise represent all or part of an industry product as silver unless it is at least 925/1,000ths pure silver, and Section 23.7 reflects a minimum of at least 500 parts per thousand pure platinum for use of the word platinum or related abbreviation to describe all or part of an industry product. The Commission seeks comments on whether it should amend the Guides to provide guidance on how to describe non-deceptively the content of alloys and alloy products that contain less than 10 karats of gold, less than 925/
1,000ths silver, or less than 500 parts per thousand platinum.
(13) Are there any provisions in the Guides setting forth particular requirements that do not accurately and
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fairly reflect the accepted customs, practices, and patterns of dealing prevalent in the industry, including the terminology and nomenclature customarily used in the course of trade?
(14) To what extent, if any, does the method that produces stones comprising a mixture of ruby/corundum and lead-glass (which are sometimes referred to as ``composite rubies,'' ``hybrid rubies,'' or ``glass-filled rubies'') differ from techniques traditionally used to treat or enhance natural rubies (e.g., glass-filling at fractures or surface fissures, application of high heat resulting in glass residue at surface-reaching cracks, in-filling with oils)?
(15) To the extent lead-glass-filled composite stones are marketed and sold as ``rubies'' or other ``natural'' gemstones without qualification, is there any evidence of consumer misperception or injury resulting from the practice? If so, please provide it.
(19) Does use of the term ``cultured,'' together with qualifying terms such as ``laboratory-created,'' ``laboratory-grown,'' manufacturer name-created,'' or ``synthetic,'' to describe laboratory-created diamonds or other gemstones that are optically, chemically, and physically equivalent to natural, mined stones of the type identified create confusion among consumers or cause consumer injury?
(20) Should the Guides be amended to address specifically whether and in what circumstances the term ``cultured'' may be used to describe diamonds or other gemstone products? If so, what guidance should be provided?
(21) Should the Guides include a provision in Section 23.20 to address the circumstances in which the term ``freshwater pearl'' may be used in a manner that is not unfair or deceptive? If so, what guidance should be provided?
You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before August 27, 2012. Write ``Jewelry Guides, 16 CFR Part 23, Project No. G711001'' on your comment. Your comment--including your name and your state--will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to remove individuals' home contact information from comments before placing them on the Commission Web site. Because your comment will be made public, you are solely responsible
for making sure that your comment does not include any sensitive personal information, such as anyone'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, do not include any ``trade secret or any commercial or financial information which is obtained from any person and which is privileged or confidential,'' as provided in 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). In particular, do not include competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names.
If you want the Commission to give your comment confidential treatment, you must file it in paper form, with a request for confidential treatment, and you must follow the procedure explained in FTC Rule 4.9(c), 16 CFR 4.9(c).\10\ Your comment will be kept confidential only if the FTC General Counsel, in his or her sole discretion, grants your request in accordance with the law and the public interest.
\10\ 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), 16 CFR 4.9(c).
If you file your comment on paper, write ``Jewelry Guides, 16 CFR Part 23, Project No. G711001'' on your comment and on the envelope, and mail or deliver it to the following address: Federal Trade Commission, Office of the Secretary, Room H-113 (Annex O), 600 Pennsylvania Avenue NW., Washington, DC 20580. If possible, submit your paper comment to the Commission by courier or overnight service.
FR Doc. 2012-16119 Filed 6-29-12; 8:45 am