Disclosure Requirements and Prohibitions Concerning Franchising

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FEDERAL TRADE COMMISSION 16 CFR Part 436 Disclosure Requirements and Prohibitions Concerning Franchising AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Final rule amendments. SUMMARY: The FTC announces revised monetary thresholds for three exemptions from the Franchise Rule. The FTC is required to adjust the size of the monetary thresholds every fourth year based upon the Consumer Price Index for all urban consumers published by the Department of Labor. DATES: This final rule is effective on July 1, 2016.

FOR FURTHER INFORMATION CONTACT: Craig Tregillus, Franchise Rule Coordinator, Division of Marketing Practices, FTC, 600 Pennsylvania Avenue NW., Washington, DC 20580, (202) 326–2970, [email protected]. SUPPLEMENTARY INFORMATION: The FTC’s Trade Regulation Rule entitled ‘‘Disclosure Requirements and Prohibitions Concerning Franchising’’ (Franchise Rule or Rule) 1 provides three exemptions based on a monetary threshold: The ‘‘minimum payment exemption,’’ 2 the ‘‘large franchise investment exemption’’ 3 and the ‘‘large franchisee exemption.’’ 4 The Rule requires the Commission to ‘‘adjust the size of the monetary thresholds every fourth year based upon the . . . Consumer Price Index for all urban consumers [CPI–U] published by the Department of Labor.’’ 5 This requirement, added by the 2007 amendments to the Rule, took effect on July 1, 2007, so that franchisors would have a one-year phase-in period within which to comply with the amended Rule’s revised disclosure requirements before the July 1, 2008, final compliance deadline.6 As required by the Rule, the Commission revised the three monetary thresholds to reflect inflation in the CPI–U from 2007 through 2011 of 8.49 percent.7 The adjusted thresholds, which took effect on July 1, 2012, raised the minimum payment exemption from $500 to $540; the large franchise investment exemption from $1 million to $1,084,900; and the large franchisee exemption from $5 million to $5,424,500.8 We base the exemption monetary thresholds that will take effect on July 1, 2016, on the increase in the CPI–U between 2007 and 2015. During this period, the annual average value of the Consumer Price Index for all urban consumers and all items increased by 14.31 percent—from an index value of 207.342 to a value of 237.017.9 Applying the percentage increase to the three monetary thresholds increases the thresholds as follows:

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31501 Federal Register / Vol. 81, No. 97 / Thursday, May 19, 2016 / Rules and Regulations 10 The Commission has rounded this figure from $571.55 to $570 for compliance clarity and simplicity.

11 See 15 U.S.C. 57a(d)(2)(B); 16 CFR 1.15(b) (providing that non-substantive amendments to trade regulation rules are exempt from the rulemaking procedures of Section 18 of the FTC Act).

12 5 U.S.C. 553(b)(B) (providing that ‘‘good cause’’ exists to forego notice and comment when public comment is unnecessary). 13 5 U.S.C. 603 and 604 (no regulatory flexibility analyses required where the APA does not require public comment).

1 We originally adopted the Filer Manual on April 1, 1993, with an effective date of April 26, 1993. Release No. 33–6986 (April 1, 1993) [58 FR 18638]. We implemented the most recent update to the Filer Manual on December 14, 2015. See Release No. 33– 9987 (January 4, 2016) [81 FR 3]. 2 See Rule 301 of Regulation S–T (17 CFR 232.301).

3 See Release No. 33–9987 in which we implemented EDGAR Release 15.4. For additional history of Filer Manual rules, please see the cites therein.

Exemption 2007 base Adjusted threshold Minimum Payment ................................................................................................................................................... $500 10 $570 Large Franchise Investment .................................................................................................................................... 1,000,000 1,143,100 Large franchisee ...................................................................................................................................................... 5,000,000 5,715,500 Because the calculation of these thresholds is purely ministerial in nature and implements the Rule’s mandatory adjustment mechanism, these adjustments are exempt from the rulemaking procedures specified in section 18 of the FTC Act.11 In addition, the Commission has determined that notice and comment are unnecessary under the Administrative Procedure Act (APA) for the same reason. The Commission, therefore, has omitted notice and comment for good cause as provided by section 553(b)(B) of the APA.12 For this reason, the requirements of the Regulatory Flexibility Act also do not apply.13 Accordingly, the adjusted thresholds will take effect on July 1, 2016. List of Subjects in 16 CFR Part 436 Advertising, Business and industry, Franchising, Trade practices. Rule Amendments For the reasons set out in the preamble of this document, the Federal Trade Commission amends 16 CFR part 436 as follows:

PART 436—DISCLOSURE REQUIREMENTS AND PROHIBITIONS CONCERNING FRANCHISING ■1. The authority citation for part 436 continues to read as follows: Authority: 15 U.S.C. 41–58. § 436.8 [Amended] ■2. Amend § 436.8 as follows: ■a. In paragraph (a)(1), remove ‘‘$540’’ and, in its place, add ‘‘$570’’; ■b. In paragraph (a)(5)(i), remove both references to ‘‘$1,084,900’’ and, in their place, add ‘‘$1,143,100’’; and ■c. In paragraph (a)(5)(ii), remove ‘‘$5,424,500’’ and, in its place, add ‘‘$5,715,500’’.

By direction of the Commission. Donald S. Clark, Secretary.

[FR Doc. 2016–11789 Filed 5–18–16; 8:45 am] BILLING CODE 6750–01–P SECURITIES AND EXCHANGE COMMISSION 17 CFR Part 232 [Release Nos. 33–10071; 34–77693; 39– 2509; IC–32091] Adoption of Updated EDGAR Filer Manual AGENCY: Securities and Exchange Commission.

ACTION: Final rule.

SUMMARY: The Securities and Exchange Commission (the Commission) is adopting revisions to the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) Filer Manual and related rules to reflect updates to the EDGAR system. The updates are being made primarily to support the 2016 XBRL taxonomies; add new submission form types SBSE, SBSE/A, SBSE–A, SBSE–A/A, SBSE–BD, SBSE–BD/A, SBSE–C and SBSE–W pursuant to Section 15F of the Securities Exchange Act of 1934 (the Exchange Act) and Rules 15Fb1–1 through 15Fb6–2 thereunder; add submission form types 17HACON, 17HACON/A, 17HQCON and 17HQCON/A pursuant to Rules 17h–1T and 17h–2T under the Exchange Act; and permit a value of zero in addition to the currently allowable numeric values in the ‘‘Current Number of Employees’’ field on the ‘‘Disclosure Requirements’’ screen of the Regulation Crowdfunding submission form types C, C/A and C–U. The EDGAR system was upgraded to support the new 2016 XBRL taxonomies on March 7, 2016. The EDGAR system is scheduled to be upgraded to support the other functionalities on April 25, 2016. DATES: Effective May 19, 2016 The incorporation by reference of the EDGAR Filer Manual is approved by the Director of the Federal Register as of May 19, 2016.

FOR FURTHER INFORMATION CONTACT: In the Division of Trading and Markets, for questions concerning Form SBSE, Form SBSE–A, Form SBSE–BD, Form SBSE– C, Form SBSE–W, and Form 17–H, contact Kathy Bateman at (202) 551– 4345; in the Division of Corporation Finance, for questions concerning Form C, contact Vik Sheth at (202) 551–3818; and in the Division of Economic and Risk Analysis, for questions concerning XBRL taxonomies, contact Walter Hamscher at (202) 551–5397. SUPPLEMENTARY INFORMATION: We are adopting an updated EDGAR Filer Manual, Volume II. The Filer Manual describes the technical formatting requirements for the preparation and submission of electronic filings through the EDGAR system.1 It also describes the requirements for filing using EDGARLink Online and the Online Forms/XML Web site.

The revisions to the Filer Manual reflect changes within Volume II entitled EDGAR Filer Manual, Volume II: ‘‘EDGAR Filing,’’ Version 36 (April 2016). The updated manual will be incorporated by reference into the Code of Federal Regulations. The Filer Manual contains all the technical specifications for filers to submit filings using the EDGAR system. Filers must comply with the applicable provisions of the Filer Manual in order to assure the timely acceptance and processing of filings made in electronic format.2 Filers may consult the Filer Manual in conjunction with our rules governing mandated electronic filing when preparing documents for electronic submission.3 The EDGAR system will be upgraded to Release 16.1 on April 25, 2016 and will introduce the following changes: Pursuant to Section 15F of the Exchange Act and Rules 15Fb1–1 through 15Fb6–2 thereunder, Securitybased Swap Dealers and Major Securitybased Swap Participants will be able to electronically register, amend their VerDate Sep<11>2014 16:37 May 18, 2016 Jkt 238001 PO 00000 Frm 00013 Fmt 4700 Sfmt 4700 E:\FR\FM\19MYR1.SGM 19MYR1 asabaliauskas on DSK3SPTVN1PROD with RULES