PLEASE HELP US FIGHT FOR YOUR FREEDOMS

Proposed FTC Business Opportunity Rule - Urgent Action Needed

Dear Nature's Sunshine Member/Manager:

Nature's Sunshine Products has been working with the Direct-Selling Association (DSA) on a recently announced Notice of Proposed Rulemaking (NPR) R511993 released by the Federal Trade Commission (FTC). This NPR, which addresses business opportunities, could have a devastating impact on the entire direct-selling industry, requiring companies to drastically alter their sales methods and placing additional burdens on direct-sellers such as you in order to comply with federal law.

In particular, the Rule, if adopted in its current form, would:

• Require that those disclosures be given at least seven days before any prospective purchaser signs a contract or makes payment to the seller;
• Require that the seller of a business opportunity provide a "disclosure statement" which would include information such as previous lawsuits, the number of direct sellers who cancel within two years and a list of "references" i.e., purchasers of the opportunity in the previous three years;
• Require business opportunity sellers who make earnings claims to provide an additional "Earnings Claim Statement" to prospective distributors, which would include extensive earnings disclosures that would need to be frequently updated and
• Create new definitions of "business opportunity," "business assistance" and "earnings claim", creating broad language to encompass many direct selling practices.
• Read the complete Rule (PDF)

We strongly urge you to draft a personal letter regarding the FTC's proposed rule. Your letter is important, since the FTC wants to hear comments from members of the public.

Written comments to the FTC must be received on or before June 16, 2006.

Please find a SAMPLE letter drafted by our attorney and the DSA, at the end of this message. This sample is meant only to be a GUIDE for you. The DSA has communicated to us that personalized letters will have a much greater impact than a mass-produced form letter. If you have already participated in sending a form letter, that's not a problem, but please also send a personal letter, expressing how this rule would impact you and your business.

Your letter should cover the following areas of concern in the rule:

Seven-Day Waiting Period
-Casts direct selling plan in a negative light
-Leads to record keeping and administrative problems
-Causes unnecessary delays

Litigation Reporting
-Is unfair that it does not distinguish between winning and losing lawsuits

References
-Is impractical to find 10 nearest distributors
-Raises privacy issues due to ID theft and safety

Appreciate FTC's Goals, But
-We understand there may be fraudulent groups out there, but the FTC's proposed rule would unfairly target legitimate direct selling businesses.

You should also include the following:

Personal Story
-Years selling products
-How selling products contributes to your family finances
-How selling products has helped you develop as a person (confidence, interpersonal skills, etc.)

Your name
Business name, if available
Street address
City, State Zip
Phone number, optional
Email address, optional

Please use the following address to mail your comments, or submit your letter online by using the FTC Comment Form (https://secure.commentworks.com/ftc-bizopNPR/ ).

Note: The FTC requires TWO copies of your letter.
Federal Trade Commission/Office of the Secretary, Room H-135 (Annex W)
Re: Business Opportunity Rule, R511993
600 Pennsylvania Avenue, NW
Washington, DC 20580
RE: Business Opportunity Rule, R511993

Please communicate this information to everyone in your successline organization, as time is of the essence. We will also have this information posted on our website under "Lobbying Issues."

Best regards,

Karen Johnson
Director - Customer Service
Nature's Sunshine Products

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SAMPLE LETTER:

Dear Sir or Madam,

I am writing this letter because I am concerned that if proposed Business Opportunity Rule R511993 is adopted in its present form, my livelihood as a Nature's Sunshine distributor will be significantly undermined.

The very thought of governmental interference in the free enterprise process strikes fear in the hearts of Americans everywhere. Cherished values are a stake, and the FTC needs to be aware of the dangers of ill considered action.

The public is not well served by the FTC's overregulation of an industry that is causing absolutely no harm and more than adequately polices itself by remedying any and all complaints by members of the public. Nature's Sunshine complies with all applicable buy back requirements and always makes it easy for individuals to exit the Company, if the business opportunity is not right for them.

While the FTC needs to protect the public where necessary, this proposed rule is hopelessly overbroad and misguided. The seven-day waiting period is unnecessary and will interfere with my ability to enter into lawful transactions and enroll new distributors. People buy TV's, cars, and other much more costly items without such a waiting period. This proposed waiting period gives the impression that something is wrong with the plan. And, the burdensome paperwork, which will not even be read by the public, makes it extremely difficult for the individual participant to fully comply, thereby risking fines and other penalties for such failures, however innocent. By these actions, the FTC does a disservice to the consuming public and Americans everywhere who are trying to get ahead by starting their own business, or earning necessary supplemental income to help support their family.

While I appreciate the work of the FTC in protecting consumers, I believe this proposed new rule has many unintended consequences that could be avoided by a less burdensome approach.

Thank you for your time in considering my comments.

Sincerely yours,

[Your signature]

[Your name]