Resolution Requiring Submission of Special Reports Relating to Funeral

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FEDERAL TRADE COMMISSION [Pile No. 732-3057; Funeral Industry] FUNERAL PRICES AND PRICING POLICIES IN TH E DISTRICT O F COLUMBIA Submission and Disclosure Requirements Notice is hereby given that the Federal Trade Commission has approved, adopted and entered of record the following resolution:

* R esolution R equiring Submission of S pecial R eports R elating to F uneral P rices and Pricing Policies In the D istrict of Columbia and Disclosure T hereof by the Commission in Con­ nection W ith a P ublic Investigation t. need for price information The funeral transaction differs consid­ erably from most business arrangements. It involves a substantial consumer ex­ penditure by large numbers of funeral buyers each year. Funeral arrangements must often be made under extreme time pressures, by persons with little or no knowledge of the area in which they are dealing, and whose bereaved condition may render them unable to exercise their normal care and business judgment. The disorientation and dependency occa­ sioned by grief, the lack of standards for gauging the value of the seller’s offer­ ings, the need for an immediate decision, general ignorance of legal requirements and restrictions, the difficulty of retriev­ ing the body once it has been committed to a mortician, and the known availabil­ ity erf governmental benefits and other monies to finance the transaction, may all combine to place the funeral buyer in a disadvantageous position vis-a-vis the seller.

Funeral buyers who must make their purchase decisions under such difficult conditions may often do so without basic information essential for a rational choice of funeral director and particular funeral services. Many consumers may speak to only one funeral director, and thus comparison of the offerings and prices of different funeral directors may be the exception, not the rule. Consumers may thus not know what options are available, or whether any of the com­ ponents of the package of services and goods offered by the funeral director can be declined and at what price reduction. Consumers may have only a vague idea of what is covered by the price quoted by the funeral director. And there have been a number of allegations that some funeral directors do not have established prices, but set their prices for each cus­ tomer according to the amount of insur­ ance, union benefits, or other monies available.

If consumers do not have knowledge about prices and choices, and do not shop comparatively for funerals, and if price information is not readily available in advertising or otherwise, the prerequi­ sites for price competition will be lacking. FEDERAL REGISTER, VOL 38, NO. 210— THURSDAY, NOVEMBER 1, 1973

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NOTICES 30155 In a setting in which price advertising may be inadequate and in which con­ sumers may lack basic information about prices and alternatives, there is a poten­ tial for unfair and deceptive pricing and sales practices. Accordingly, the Com­ mission has determined to obtain infor­ mation about pricing practices and poli­ cies, and to insure that consumers receive price information, the Commission will make such information public under such terms and conditions as it may from time to time determine.

The Commission needs the information to better understand competitive condi­ tions, to obtain hard data mi funeral costs, and generally to assist it to detect and prevent any violations of section 5 of the Federal Trade Commission Act (15 U.S.C. 45) which may have occurred or be occurring. By injecting such-informa­ tion into the public sector the Commis­ sion can supply a stimulus to price com­ petition which can then operate to hold down costs and eliminate such inefficien­ cies as may exist.

In view of the importance of the pos­ sible competitive and information de­ ficiencies in the funeral industry to con­ sumers and to the Commission, the Commission’s statutory responsibilities under section 5 of the Federal Trade Commission Act with respect to unfair and deceptive acts or practices and un­ fair methods of competition, compel it to take action to obtain information on funeral pricing policies and to make the Information available to consumers. And to insure that such information will be complete, accurate, and promptly sup­ plied, the Commission, will obtain it with the aid of the compulsory processes available to it.

Accordingly, the Commission resolves that funeral directors and others en­ gaged or involved in the sale of various goods and services in connection with funeral or other arrangements for dis­ posal of the dead in the District of Co­ lumbia shall be required to submit infor­ mation on prices and related matters, specified in Orders to File Special Re­ ports which shall be issued to such re­ spondents as may be selected by the Commission.

The Commission will compel the pro­ duction of said information in the ex­ ercise of the powers vested in it by sec­ tions 5, 6, 9, and 10 of the Federal Trade Commission Act (15 U.S.C. 45, 46, 49, and 50) and with the aid of any and all powers conferred upon it by law, and any and all compulsory processes avail­ able to it.

n. PUBLIC RELEASE OF THE INFORMATION SUBMITTED The material obtained by the Com­ mission pursuant to this resolution will be made available to the public under such terms and conditions as the Com­ mission may from time to time deter­ mine. In addition, the Commission may release summaries, reports, charts, in­ dices,, or other publications which will inform the public about the material de­ livered or not delivered to it hereunder. The Commission’s decision to make this information available to the public rests on a number of policy considera­ tions, including the following: (1) Funeral purchasers need informa­ tion about prices, options and polices for particular funeral homes and compara­ tive data for different funeral homes, in order to choose rationally a funeral home and the particular funeral arrangements that will best serve their needs. (2) Consumers may not be able to obtain the information they need to make intelligent funeral purchases. (3) Disclosure of information about funeral prices and policies by the Com­ mission may enable consumers to protect their own interests better when they deal with a funeral director.

(4) The knowledge that price and other information covered by special re­ ports will be made public may encourage voluntary disclosure of essential infor­ mation, if such voluntary disclosures are not presently being made. It may also lead to a self-examination of the fair­ ness of offered prices and conditions, not only by the respondents actually sub­ jected to 6(b) orders, but by others in the industry as well.

(5) Public disclosure of pricing infor­ mation may supply a stimulus to price advertising and price competition. (6) The Commission’s limited re­ sources restrict its ability to uncover practices such as tie-in sales, conceal­ ing less expensive alternatives, or other potential violations of section 5 of the Federal Trade Commission Act. Public awareness of the data reported to the Commission can lead the public to alert the Commission to discrepancies between reported and actual behavior and to pos­ sible violations of section 5 of the Federal Trade Commission Act.

By direction of the Commission dated October 4, 1973.

[ seal] Charles A. T obin, Secretary.

[PR Doc.73-23293 Filed 10-31-73;8:45 am]