FTC's New Business Opportunity Rule and How it Could Impact Your Online Business
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On March 1, 2012, the Federal Trade Commission began enforcing their newly updated "Business Opportunity Rule" (Rule 16. C.F.R., Part 37), when it went into effect on that day. The "Disclosure Requirements and Prohibitions Concerning Business Opportunities" was amended to broaden the scope of the original rule to cover work-at-home business opportunities, and to streamline the disclosures that merchants of business opportunity programs must provide to prospects.
This new rule brings about two significant changes. The first change is that the new ruling modifies the existing rule to encompass business opportunities that were not covered before. The second change is in the streamlined, one-page disclosure that replaces the extensive disclosures that were required in the past.
How could this ruling affect your online business?
If you offer business opportunities on your website, or if you have advertisers who fall under the purview of this new law, you will be required to fill out the disclosure form and make it available to prospective buyers of your programs.
The disclosure form asks the merchant of a business opportunity program to disclose if they have been the subject of a civil or criminal action, it asks for a written cancellation policy to be attached to the disclosure form, earnings disclosures, and references for at least ten people who have purchased the business opportunity so that prospective buyers may contact them with questions.
There is a signature field where the prospect signs their name acknowledging that they have received the form. The merchant must then wait seven calendar days before asking the prospect to make a purchase.
Here is a link to download the FTC Ruling:
http://ftc.gov/os/fedreg/2011/11/111122bizoppfrn.pdf
Here is a link to download a copy of the form:
Appendix A to Part 437--Disclosure of Important Information About Business Opportunity
This ruling has been put in place to protect consumers from being scammed by business opportunities that contained ridiculous income claims, and overly-hyped marketing language which plays on people's tendency towards greed and laziness.
Of course, not every business opportunity merchant will comply with this law, and as the FTC receives complaints from consumers they may make examples of these companies. If you offer business opportunities to consumers, you should contact your attorney to find out if you are subject to this ruling.
Consumers should still exercise caution when considering a work-at-home business opportunity. More often than not if something sounds too good to be true it most likely is. Beware if you can detect that the marketing language seems to be appealing to a sense of greed, and if they are offering exorbitant amounts of money for doing tasks that you would not expect to be paid that amount of money for. There is always a catch. Use your common sense when considering a business opportunity, and be sure to thoroughly research the reviews and the references provided by the merchant to see just how many others who purchased that program were able to become as successful as the ads promise.
For more information about legitimate ways you can make real money online by building a solid online business, visit http://mcreasite.com/blog today.
This new rule brings about two significant changes. The first change is that the new ruling modifies the existing rule to encompass business opportunities that were not covered before. The second change is in the streamlined, one-page disclosure that replaces the extensive disclosures that were required in the past.
How could this ruling affect your online business?
If you offer business opportunities on your website, or if you have advertisers who fall under the purview of this new law, you will be required to fill out the disclosure form and make it available to prospective buyers of your programs.
The disclosure form asks the merchant of a business opportunity program to disclose if they have been the subject of a civil or criminal action, it asks for a written cancellation policy to be attached to the disclosure form, earnings disclosures, and references for at least ten people who have purchased the business opportunity so that prospective buyers may contact them with questions.
There is a signature field where the prospect signs their name acknowledging that they have received the form. The merchant must then wait seven calendar days before asking the prospect to make a purchase.
Here is a link to download the FTC Ruling:
http://ftc.gov/os/fedreg/2011/11/111122bizoppfrn.pdf
Here is a link to download a copy of the form:
Appendix A to Part 437--Disclosure of Important Information About Business Opportunity
This ruling has been put in place to protect consumers from being scammed by business opportunities that contained ridiculous income claims, and overly-hyped marketing language which plays on people's tendency towards greed and laziness.
Of course, not every business opportunity merchant will comply with this law, and as the FTC receives complaints from consumers they may make examples of these companies. If you offer business opportunities to consumers, you should contact your attorney to find out if you are subject to this ruling.
Consumers should still exercise caution when considering a work-at-home business opportunity. More often than not if something sounds too good to be true it most likely is. Beware if you can detect that the marketing language seems to be appealing to a sense of greed, and if they are offering exorbitant amounts of money for doing tasks that you would not expect to be paid that amount of money for. There is always a catch. Use your common sense when considering a business opportunity, and be sure to thoroughly research the reviews and the references provided by the merchant to see just how many others who purchased that program were able to become as successful as the ads promise.
For more information about legitimate ways you can make real money online by building a solid online business, visit http://mcreasite.com/blog today.