The Federal Trade Commission (“FTC”) recently issued final amendments to the Mail or Telephone Order Merchandise Rule, which will now be known as the “Mail, Internet, or Telephone Order Merchandise Rule.”
The FTC Amends the Mail or Telephone Order Merchandise Rule
The FTC proposed the instant amendments to the Mail or Telephone Order Merchandise Rule (the “Rule”) in October 2011. The Rule was originally issued in 1975 and required marketers who solicited consumers to order goods through the mail or by telephone to have a reasonable basis to expect that they would be able to ship the goods within the timeframe advertised or otherwise within thirty days. The FTC is now amending the Rule based on changes in technology and commercial practices, as follows:
- Expanding the Rule to include all Internet merchandise orders – including those made through mobile applications – and changing the name of the Rule to reflect Internet orders;
- Permitting sellers to provide refunds and refund notices to consumers “by any means that is at least as fast and reliable as first-class mail;”
- Clarifying sellers’ obligations when consumers use payment methods not specifically listed in the Rule, such as debit cards or prepaid gifts cards; and
- Requiring sellers to provide refunds within seven business days for purchases made using third party credit cards and within one credit cycle for purchases made using any seller-issued credit card.
The amendments will go into effect on December 8, 2014.
As we have reported, the FTC regularly polices its rules and regulations with a particular emphasis in recent years on deceptive advertising and marketing practices. It is important to understand the new Rule to ensure compliance in advance of December 8, 2014.