[Federal Register Volume 61, Number 61 (Thursday, March 28, 1996)]
[Rules and Regulations]
[Pages 13659-13666]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-7528]
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FEDERAL TRADE COMMISSION
16 CFR Part 460
Trade Regulation Rule: Labeling and Advertising of Home
Insulation
AGENCY: Federal Trade Commission.
ACTION: Final rule.
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SUMMARY: The Federal Trade Commission (the ``Commission'' or ``FTC'')
announces it is retaining its Trade Regulation Rule Concerning the
Labeling and Advertising of Home Insulation (``R-value Rule'' or
``Rule'') and adopting non-substantive amendments to the Rule. The
Commission amends section 460.5(a) of the R-value Rule to allow use of
the R-value test procedure in American Society of Testing and Materials
(``ASTM'') standard test method C 1114-95. The Commission also amends
sections 460.5(a), 460.5(a)(2), 460.5(b), and 460.5(d)(1) to specify
revised versions of additional ASTM standards that are required for
determining the R-value of home insulation. Further, the Commission
amends the Rule to add a summary of the exemptions from specific
requirements of the Rule that the Commission previously granted for
certain classes of persons covered by the Rule. Last, the Commission
adopts a non-substantive amendment to revise section 460.10 to cross-
reference the Commission's enforcement policy statement for foreign
language advertising in 16 CFR 14.9 and to delete the current Appendix
to the Rule, which merely repeats the text of 16 CFR 14.9.
EFFECTIVE DATE: The amendments are effective on April 29, 1996. The
incorporation by reference of certain publications listed in the
regulations is approved by the Director of the Federal Register as of
April 29, 1996.
FOR FURTHER INFORMATION CONTACT: Kent C. Howerton, Attorney, Federal
Trade Commission, Washington, DC 20580, (202) 326-3013 (voice), (202)
326-3259 (fax).
SUPPLEMENTARY INFORMATION:
I. Introduction
On April 6, 1995, as part of its oversight responsibilities and its
program to review all current Commission rules and guides periodically,
the Commission solicited public comments about the economic impact of
and current need for the R-value Rule, 60 FR 17492 (1995).1 At the
same time, the Commission solicited comments on a petition
(``Petition'') requesting the Commission to approve an additional
(fifth) ASTM R-value test procedure as an optional, but not required,
test procedure for determining the R-value of home insulation under the
Rule.
\1\ The Commission reviewed the Rule in 1985 under the
Regulatory Flexibility Act, 5 U.S.C. 610, to determine the economic
impact of the Rule on small entities. Based on that review, the
Commission determined that: There was a continuing need for the
Rule; there was no basis to conclude that the Rule had a significant
impact on a substantial number of small entities; there was no basis
to conclude that the Rule should be amended to minimize its economic
impact on small entities; the Rule did not generally overlap,
duplicate, or conflict with other regulations; and technological,
economic, and other changes had not affected the Rule in any way
that would warrant amending the Rule. 50 FR 13246 (1985).
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The Commission received 42 comments in response to the April 6,
1995 notice.2 The commenters included the following parties:
Manufacturers of cellular plastics, cellulose, mineral fiber, and
reflective insulation products; manufacturers of structural insulated
panels; trade associations comprised of manufacturers of insulation
products and structural insulated panels, professional installers, and
roofing contractors; independent technical consultants to industry; a
government contractor; and individual consumers. Specific issues
addressed by the commenters are described below in Parts III through
VI.
\2\ Plymouth Foam Products (``Plymouth''), comment number #01;
Advanced Foil Systems (``AFS''), #02; W.H. Porter, Inc.
(``Porter''), #03; Benchmark Foam, Inc. (``Benchmark''), #04; Big
Sky Insulations, Inc. (``Big Sky''), #05; Rock Wool Manufacturing
Co. (``Rock Wool Mfg./1''), #06; Rose E. Kettering (``Kettering''),
#07; Matt Anderson (``Anderson''), #08; Marilyn Raeth (``Raeth''),
#09; James A. McGarry (``McGarry''), #10; Structural Insulated Panel
Association (``SIPA''), #11; Tierra Consulting Group (``Tierra''),
#12; EPS Molders Association (``EPSMA''), #13; Western Insulfoam,
Division of Premier Industries, Inc. (``Western''), #14; Fi-Foil
Co., Inc. (``Fi-Foil/Nowman''), #15; Regal Industries, Inc.
(``Regal''), #16; Insulation Contractors Association of America
(``ICAA/1''), #17; England & Associates (``England''), #18;
Cellulose Insulation Manufacturers Association (``CIMA''), #19;
GreenStone Industries (``Greenstone/Tranmer''), #20; Styropor
Business, BASF Corporation (``BASF''), #21; Hamilton Mfg., Inc.
(``Hamilton''), #22; Energy Control, Inc. (``ECI''), #23; North
American Insulation Manufacturers Association (``NAIMA''), #24; The
Celotex Corporation (``Celotex''), #25; Tennessee Technological
University, (``TN Tech''), #26; Superior Aluminum Insulation Inc.
(``Superior''), #27; Oak Ridge National Laboratory (``ORNL/
Yarbrough''), #28; Oak Ridge National Laboratory (``ORNL/Wilkes''),
#29; Polyisocyanurate Insulation Manufacturers Association
(``PIMA''), #30; Midwest Roofing Contractors Association (``MRCA''),
#31; GreenStone Industries (``GreenStone/Smith''), #32; Insulspan,
Inc. (``Insulspan''), #33; Clayville Insulation (``Clayville''),
#34; Tascon, Inc. (``Tascon''), #35; FischerSips Inc.
(``FischerSips''), #36; Dow Chemical Canada Inc. (``Dow/Canada''),
#37; AFM Corporation (``AFM''), #38; Rock Wool Manufacturing Co.
(``Rock Wool Mfg./2''), #39; Insulation Contractors Association of
America (``ICAA/2''), #40; Corbond Corp. (``Corbond''), #41; Fi-Foil
Co., Inc. (``Fi-Foil/Lippy''), #42. The April 6, 1995 notice is
filed as document number B172394. The comments submitted in response
to the that notice are filed as document numbers B17239400001,
B17239400002, etc. In today's notice, the comments are cited as #01,
#02, etc. The Commission's staff added an additional letter from the
Petitioner, R. S. Graves, R & D Services, Inc. This letter, cited as
Graves, #43, was not filed as a comment in response to the April 6,
1995 notice, but instead, as a response to a request for
clarification from the Commission's staff. See Part V and note 64,
infra.
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II. Requirements of the R-Value Rule
The Commission promulgated the R-value Rule under section 18 of the
FTC Act, 15 U.S.C. 57a, on August 27, 1979.3 The Rule became
effective on September 29, 1980, 45 FR 54702 (1980).
\3\ Final trade regulation rule (``Statement of Basis and
Purpose'' or ``SBP''), 44 FR 50218 (1979).
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The R-value Rule covers home insulation products. The Rule defines
``insulation'' as any product mainly used to slow down heat flow, for
example through a house's exterior walls, attic, floors over crawl
spaces, or basement. It defines ``home insulation'' as insulation used
in old or new houses, condominiums, cooperatives, apartments, modular
homes, and mobile homes. The Rule does not cover insulation products
sold for use in commercial or industrial buildings, such as offices or
factories. It does not apply to other products with insulating
characteristics, such as storm windows or doors.
The Rule applies to home insulation manufacturers, professional
installers, retailers, and new home sellers (including sellers of
manufactured or mobile homes). It also applies to testing laboratories
that conduct R-value tests for home insulation manufacturers or other
sellers who use the test results as the basis for making R-value claims
about home insulation products.
The Rule requires that those who manufacture or sell thermal
insulation products for use in residential structures disclose specific
information about the thermal performance of the insulation at
[[Page 13660]]
the point of sale (on product labels, manufacturers' fact sheets, and
receipts or contracts to purchasers from professional installers and
new home sellers), and in advertising and other promotional materials
that contain certain claims. Thermal performance is described by the
product's R-value, which varies among insulation types and forms and
among specific products of the same type and form.4 ``R-value'' is
the recognized numerical measure of the ability of an insulation
product to restrict the flow of heat and, therefore, to reduce energy
costs. The higher the R-value, the better the product's insulating
ability. The major reason consumers purchase thermal insulation is to
reduce energy expenditures to heat and cool their homes. The Rule
requires sellers to have adequate substantiation for these R-value
disclosures and for any energy savings claims they make.
\4\ ``Type'' refers to the material from which the insulation is
made, e.g., fiberglass or cellulose. ``Form'' refers to the physical
form of the product, e.g., batts, loose-fill, or rigid boardstock.
Most home insulation products are ``mass'' insulations, which
restrict the flow of heat through the product's mass. ``Reflective''
insulations (which also are covered by the Rule), on the other hand,
restrict heat flow by reflecting back radiant heat and must be
installed facing an air space.
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The R-value Rule is designed to enable consumers to compare the
thermal performance of competing home insulation products when they
make purchasing decisions. To accomplish this purpose, the Rule
requires sellers (including insulation manufacturers, professional
installers, new home sellers, and retailers who sell insulation to
consumers) to disclose the insulation product's R-value and related
information, based on uniform standards. This information enables
consumers to evaluate how well a particular insulation product is
likely to perform, to determine whether the cost of the insulation is
justified, and to make meaningful cost-benefit purchase decisions among
competing products.
III. Regulatory Review
The Commission has determined, as part of its oversight
responsibilities, to review all current Commission rules and guides
periodically. These reviews seek information about the costs and
benefits of the Commission's rules and guides and their regulatory and
economic impact. The information obtained assists the Commission in
identifying rules and guides that warrant modification or recision. In
the April 6, 1995 notice, the Commission solicited comments on, among
other things, the economic impact of and the continuing need for the R-
value Rule, possible conflict between the Rule and state, local, or
other federal laws or regulations, and the effect on the Rule of any
technological, economic, or other industry changes. The Commission also
solicited comments on whether the Rule should be revised to require the
use of different test procedures or standards than those currently
specified, and whether there are insulation products for which the Rule
does not sufficiently address product-specific issues relating to
testing or preparation of test specimens.
A. Need for the Rule, Benefits, Costs, and Other Burdens
1. Current Need for the Rule
Thirty-one comments specifically addressed the current need for the
Rule. Thirty comments stated that there is a continuing need for the
Rule and supported keeping it in place.5 Only one commenter,
Benchmark, implied that the Rule was not needed, stating that the costs
of complying with the Rule far outweigh the benefits it confers.6
Benchmark did not explain how it reached this conclusion.
\5\ AFS, #02 (must stay in place, keep regulations that work);
Porter, #03 (continue and strengthen); Rock Wool Mfg./1, #06
(provides basic guidelines by which consumers better assured of
receiving full value); Kettering, #07 (R-values must be maintained
or consumer has no guideline and inferior products will be passed
off on the public); Anderson, #08, at 2-3 (labeling ensures
consumers can easily select products with the R-value they want);
Raeth, #09 (eliminating Rule would be a great disservice to
consumers, consumers would not know the value of what purchasing);
McGarry, #10 (do not eliminate or weaken, uses label information to
compare when purchasing); SIPA, #11, at 1 (retain); Tierra, #12, at
1-2 (serves useful public purpose); Western, #14, at 1; Fi-Foil/
Nowman, #15, at 1 (serves useful purpose); Regal, #16, at 1
(retain); ICAA/1, #17, at 1 (necessary); England, #18, at 1 (need
stronger today than ever); CIMA, #19, at 1 (valuable protection for
consuming public); Greenstone/Tranmer, #20, at 1 (critical to
consumers; centralized labeling requirements necessary to maintain
consistency in products, avoid costly production costs resulting
from rules differing from region to region, and encourage
development of advanced products); BASF, #21, at 1 (urges be
retained); Hamilton, #22, at 1 (still needed in today's market);
ECI, #23 (good Rule that should be continued); NAIMA, #24, at 1
(should be maintained, market place would be chaotic in its
absence); Celotex, #25, at 1 (continuing need), at 7 (supports the
Rule); TN Tech, #26, at 1 (extremely important to industry and
consuming public); ORNL/Wilkes, #29, at 1 (supports keeping,
Commission to be commended for promulgating and enforcing the Rule);
PIMA, #30, at 2 (continuing need), at 9 (vigorously supports
retaining and enforcing Rule and applauds FTC for its efforts in
this regard); Greenstone/Smith, #32, at 1 (provides a viable means
of creating broader consumer awareness of insulation value and
maintaining even playing field, without Rule sellers would take
advantage of naive consumers); Insulspan, #33, at 1 (retain);
Clayville, #34, at 3 (still needed to keep a level playing field);
FischerSips, #36, at 1 (retain); Fi-Foil/Lippy, #42 (should be
continued to enable general public to evaluate insulation products).
See also, Rock Wool Mfg./1, #06 (fully supports ICAA's submittal).
\6\ Benchmark, #04.
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Based on the comments, the Commission determines that there is a
continuing need for the Rule.
2. Benefits and Costs to Purchasers
Twenty-four comments described the benefits the Rule confers on
purchasers.7 In summary, the comments described the major benefits
of the Rule to consumers as:
\7\ Porter, #03; Rock Wool Mfg./1, #06; Anderson, #08, at 2-3;
McGarry, #10; Tierra, #12, at 1-2; Western, #14, at 1; Fi-Foil/
Nowman, #15, at 1; ICAA/1, #17, at 1; England, #18, at 1; CIMA, #19,
at 1; Greenstone/Tranmer, #20, at 1; Hamilton, #22, at 1; TN Tech,
#26, at 1; ORNL/Wilkes, #29, at 1-2; PIMA, #30, at 2-3, 9;
Greenstone/Smith, #32, at 1; Clayville, #34, at 1; Celotex, #35, at
1; Fi-Foil/Lippy, #42. See also, Rock Wool Mfg./1, #06; Kettering,
#07; Raeth, #09; ECI, #23; NAIMA, #24, at 1.
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Increasing consumer awareness of the benefits of
insulation; 8
\8\ ORNL/Wilkes, #29, at 1; Greenstone/Smith, #32, at 1.
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Giving consumers the basic thermal performance information
they need to compare insulation products and select those with the R-
value they want,9 at little or no cost; 10
\9\ Anderson, #08, at 2-3; McGarry, #10; Greenstone/Tranmer,
#20, at 1; PIMA, #30, at 2-3; Fi-Foil/Lippy, #42. See Raeth, #09;
ECI, #23.
\10\ ICAA/1, #17, at 1. See also Rock Wool Mfg./1, #06.
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Giving consumers R-value information in a uniform manner
that facilitates easy comparison of competing products; 11
\11\ Tierra, #12, at 1-2; Fi-Foil/Nowman, #15, at 1; England,
#18, at 1; PIMA, #30, at 3; Celotex, #35, at 1.
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Helping ensure that R-value claims are substantiated so
consumers receive what they are promised; 12
\12\ Porter, #03; Tierra, #12, at 1-2; England, #18, at 1;
Hamilton, #22, at 1. See Kettering, #07; Raeth, #09; ECI, #23;
NAIMA, #24, at 1.
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Helping consumers save energy (and heating and cooling
costs) by preventing misrepresentations about R-values of insulation
products,13 and by setting standards for the proper installation
of insulation products; 14
\13\ Porter, #03. See Rock Wool Mfg./1, #06.
\14\ See Rock Wool Mfg./1, #06.
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Saving consumers money by eliminating sales and marketing
practices that lead them to overinsulate or underinsulate; 15
\15\ CIMA, #19, at 1.
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Improving the quality 16 and consistency 17 of
home insulation, encouraging the development of advanced
products,18 and preventing the sale of inferior products; 19
and
\16\ TN Tech, #26, at 1.
\17\ Greenstone/Tranmer, #20, at 1.
\18\ Id.
\19\ See Kettering, #07.
[[Page 13661]]
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Reducing the rate of depletion of our nation's limited
energy resources by helping consumers conserve energy
expenditures.20
\20\ ORNL/Wilkes, #29, at 1.
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In addition to the benefits described above, Greenstone/Smith
explained that utility companies have embraced the Rule and developed
their own energy savings programs that depend on the Rule to protect
consumers from fraudulent acts.21 Greenstone/Smith also stated
that state departments of consumer affairs have used the Rule as a
model in writing their laws, which has led to state enforcement actions
that generated publicity and educated consumers. Greenstone/Smith
further stated that consumers would be in a user-beware condition
without the Rule and that sellers would lower their ethical boundaries
and take advantage of naive consumers.22
\21\ Greenstone/Smith, #32, at 1.
\22\ Id. See also NAIMA, #24, at 1; ORNL/Wilkes, #29, at 2.
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Sixteen commenters addressed the costs the Rule imposes on
purchasers. Fifteen of these commenters stated that they did not
believe the Rule imposes significant costs on purchasers.23 Only
one, Benchmark, stated that the costs imposed by the Rule outweigh the
Rule's benefits.24 In brief, the commenters other than Benchmark
expressed the following views concerning costs the Rule imposes on
consumers:
\23\ Rock Wool Mfg./1, #06; Tierra, #12, at 2; Western, #14, at
1; Fi-Foil/Nowman, #15, at 1; ICAA/1, #17, at 1; England, #18, at 1;
CIMA, #19, at 1; Greenstone/Tranmer, #20, at 2; Hamilton, #22, at 1;
Celotex, #25, at 1; TN Tech, #26, at 1; ORNL/Wilkes, #29, at 2-3;
PIMA, #30, at 3, 9; Greenstone/Smith, #32, at 1; Clayville, #34, at
1.
\24\ Benchmark, #04.
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no cost; 25
\25\ Rock Wool Mfg./1, #06; ICAA/1, #17, at 1; CIMA, #19, at 1;
Hamilton, #22, at 1.
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Minimal or insignificant cost,26 or small cost when
spread over volume of production; 27
\26\ Celotex, #25, at 1; TN Tech, #26, at 1; PIMA, #30, at 3, 9;
Clayville, #34, at 1.
\27\ Greenstone/Tranmer, #20, at 2; ORNL/Wilkes, #29, at 2-3.
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Very small cost imposed is offset by improved product
quality and the benefit-to-cost ratio is very large; 28
\28\ TN Tech, #26, at 1. See Greenstone/Tranmer, #20, at 2.
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Any cost already has been born by manufacturers and is
embedded in product pricing; 29
\29\ Tierra, #12, at 2; Fi-Foil/Nowman, #15, at 1.
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Required testing should already have been done so the only
additional cost is the Fact Sheet, which can be produced at minimal
expense; 30
\30\ Greenstone/Smith, #32, at 1.
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Possibly has imposed cost, but not nearly the waste of
money that would have occurred without the Rule; 31 and
\31\ Western, #14, at 1.
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Has saved consumers on cost.32
\32\ England, #18, at 1.
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Based on the comments, the Commission determines that the Rule
provides substantial benefits to consumers, while imposing no
significant costs on them.
3. Benefits and Burdens or Costs to Firms
Ten comments addressed the benefits provided to firms covered by
the Rule.33 According to the comments, the Rule benefits firms by:
\33\ Porter, #03; Tierra, #12, at 1-2; Western, #14, at 1, but
see, at 2; England, #18, at 2; Greenstone/Tranmer, #20, at 3;
Celotex, #25, at 2; PIMA, #30, at 2, 4, 9; Greenstone/Smith, #32, at
1; Clayville, #34, at 1, 3. See NAIMA, #24, at 1.
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Creating a level playing field through standardized
guidelines for labeling, testing, and evaluation, which promote
legitimate competition and make it easier for honest manufacturers to
compete; 34
\34\ Porter, #03; Tierra, #12, at 1-2; Western, #14, at 1, but
see, at 2 (not much benefit for Western); Greenstone/Tranmer, #20,
at 3; Celotex, #25, at 2; Clayville, #34, at 3. See also NAIMA, #24,
at 1 (marketplace would be chaotic in its absence).
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Providing a more even market place in which it is easier
for industry to attempt to regulate itself; 35
\35\ England, #18, at 2.
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Enhancing competition by enabling suppliers to convey
truthfully and meaningfully the insulation properties of their
products; 36 and
\36\ PIMA, #30, at 2.
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Providing guidelines for product testing and evaluation
and creating confidence in the residential buyer's mind.37
\37\ Id. at 4.
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As pointed out in Part III.A.2, above, Greenstone/Smith stated that
individual utility companies have developed energy savings programs
that depend on the Rule to protect consumers from fraudulent
acts.38 According to the commenter, by encouraging consumers to
insulate homes, these programs benefit firms by generating an ever-
increasing demand for products covered by the Rule.
\38\ Greenstone/Smith, #32, at 1 .
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Fourteen comments addressed the burdens or costs imposed on firms
covered by the Rule. Eleven of these stated that the Rule had not
imposed any significant costs on firms.39 Tierra stated merely
that any costs due to the Rule already were imbedded in the pricing of
the products.40 Fi-Foil/Nowman stated that the Rule had a
substantial economic impact on industry members originally because it
required redesigning and reprinting packaging and promotional materials
to meet the labeling requirements, but that these costs already had
been borne by manufacturers.41 Benchmark stated that the costs
imposed by the Rule outweigh its benefits.42
\39\ Rock Wool Mfg./1, #06 (not aware of any significant added
cost); Western, #14, at 2 (for it $0); ICAA/1, #17, at 1 (no
significant cost burden); England, #18, at 2 (none, because what
Rule requires should be done anyway); CIMA, #19, at 2 (few
incremental costs of compliance since requirements are based on
existing industry and government standards); Greenstone/Tranmer,
#20, at 3 (does not impose large financial burden); Hamilton, #22,
at 1 (do not think it has imposed additional costs); Celotex, #25,
at 2 (no significant burdens or costs since R-value data is
necessary for marketing, quality control, and research purposes);
PIMA, #30, at 4 (no significant burdens or costs, benefits clearly
outweigh any burdens or costs), at 9 (does not impose significant
burden or cost); Greenstone/Smith, #32, at 1 (required testing
should already have been done when Commission issued Rule and no
additional tests were required, only additional cost was Fact Sheet
which could be produced at minimal expense to manufacturer);
Clayville, #34, at 1 (doesn't believe the Rule has imposed any
excessive costs on manufacturers or contractors).
\40\ Tierra, #12, at 2.
\41\ Fi-Foil/Nowman, #15, at 1.
\42\ Benchmark, #04.
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Based on the comments, the Commission determines that the Rule
benefits firms by creating a level playing field that promotes
competition, by providing a market place in which industry can more
easily regulate itself, by providing guidelines to industry for product
testing and evaluation, and by creating consumer confidence. The
Commission also determines that the Rule does not impose significant
ongoing costs on firms.
B. Other Federal, State, or Local Laws or Regulations
Nine comments addressed the existence of other federal, state, or
local laws or regulations. None of the commenters was aware of any
conflicts with other federal, state, or local laws or
regulations.43 England stated that the Rule strengthens other
federal, state, and local laws and regulations.44 Celotex and PIMA
explained that the Rule is a consumer protection regulation, which does
not address issues such as building energy conservation standards that
are regulated elsewhere at the federal, state, and local levels.45
Greenstone/Smith stated that the Rule has been precedent-setting rather
than conflicting, and that
[[Page 13662]]
utility companies have embraced the Rule's requirements and developed
energy-saving programs that depend on the Rule to protect consumers
from fraudulent acts.46
\43\ Rock Wool Mfg./1, #06; Tierra, #12, at 3; Western, #14, at
3; England, #18, at 2; CIMA, #19, at 2; Greenstone/Tranmer, #20, at
4; Celotex, #25, at 2; PIMA, #30, at 5; Greenstone/Smith, #32, at 1.
\44\ England, #18, at 2 .
\45\ Celotex, #25, at 2; PIMA, #30, at 5.
\46\ Greenstone/Smith, #32, at 1.
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Based on the comments, the Commission determines that there is no
reason to believe that the Rule conflicts with other federal, state, or
local laws or regulations.
IV. Adoption of Current ASTM Standards
The Rule currently requires that the R-value of each home
insulation product be determined based on tests conducted according to
ASTM C 177-85, C 236-87, C 518-85, or C 976-82.47 It requires that
R-values based upon heat flux measurements under C 177-85 or C 518-85
be reported in accordance with ASTM standard practice C 1045-85. It
also requires that, for loose-fill cellulose, the tests be conducted at
the settled density determined under ASTM C 739-88 (``Standard
Specification for Cellulosic Fiber (Wood-Base) Loose-Fill Thermal
Insulation'').48
\47\ In citations of ASTM standards, the letter and first series
of numbers refer to the basic standard; the number following the
hyphen refers to the version of the standard (denoting the year in
which the version was adopted and published by ASTM).
\48\ This section discusses only the comments that recommended
the Commission revise the Rule concerning specific ASTM test
procedures and other standards that currently are required by the
Rule. It does not discuss the comments that recommended the
Commission adopt additional or different ASTM or other test
procedures or standards that are not currently required by the Rule.
See Part VI, infra.
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Four comments discussed which versions of specified ASTM test
procedures or other standards should be required by the Rule. Celotex
and PIMA recommended that the Commission revise the Rule to require the
use of current versions of required ASTM standards that are
incorporated into the Rule. Specifically, they recommended that the
Commission amend the Rule to require use of the following versions of
ASTM standards: ASTM C 177-85 (1993), ASTM C 236-89 (1993), ASTM C 518-
91, ASTM C 976-90, ASTM C 1045-90.49 NAIMA recommended that the
Commission revise section 460.5(a)(2) to require settled density
testing of loose-fill cellulose according to C 739-91.50 No
comments opposed adoption of these current versions of the ASTM
standards.
\49\ Celotex, #25, at 3; PIMA, #30, at 5. Both comments stated
that the 1993 revisions to C 177-85 and C 236-89 (the year 1993 is
indicated in parentheses in the standards) were editorial only.
\50\ NAIMA, #24, at 2.
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NAIMA pointed out that an alternative to referencing current
versions of ASTM standards would be to omit the specific version and
rely on the language in section 460.7 of the Rule, 16 CFR 460.7.51
Section 460.7 provides that updated, final ASTM test methods
automatically replace the old ones in the Rule 90 days after
publication by ASTM. Greenstone/Smith agreed with this approach.52
\51\ Id. at 7.
\52\ Greenstone/Smith, #32, at 3.
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ASTM was organized in 1898. A not-for-profit organization, it is
one of the largest voluntary standards-development organizations in the
world. ASTM's members (approximately 36,000 worldwide) include
producers, users, ultimate consumers, and those having a general
interest (including government and academia). Through 132 standards-
writing committees, ASTM publishes more than 9,500 standards each year.
Membership in ASTM is open to all interested parties concerned with the
fields in which ASTM is active.53 ASTM standards are developed
through a consensus-type process and are used voluntarily. They become
legally binding only when a government body references them in
regulations, or when they are cited in a contract. ASTM standards are
subject to revision at any time by the responsible technical committee
and must be reviewed every five years, and if not revised, either
reapproved or withdrawn.54 ASTM's C-16 Committee on Thermal
Insulation is the standards-writing committee responsible for virtually
all of the ASTM standards referenced in the R-value Rule.
\53\ 1995 Annual Book of ASTM Standards, Section 4, Volume 04.06
(Thermal Insulation; Environmental Acoustics), at iii.
\54\ Id. at iv.
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Section 460.7 of the Rule provides for automatic incorporation into
the Rule of revisions to these ASTM test procedures. As part of this
automatic incorporation, the Commission originally cited in the Rule
only the basic test procedures and other standards, not the specific
version of each then in effect. Under section 460.7, when ASTM changed
a test procedure required by the Rule, the new version automatically
replaced the old one in the Rule 90 days after ASTM first published the
change.55 In 1990, the Commission amended the Rule to specify the
version of each ASTM test procedure that would be required in the
future. 55 FR 10053 (1990). The Commission explained that, because it
previously had taken no action to consider any of the revisions to the
required test procedures that ASTM had adopted since the Commission
promulgated the Rule, the Commission in effect had adopted the revised
procedures. Id. at 10054.
\55\ Under section 460.7, the Commission's staff or a person
affected by the change can petition the Commission during the 90-day
period not to adopt the change or to reopen the rulemaking
proceeding to consider it further.
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The Office of the Federal Register (``OFR'') specifies additional
procedures that federal agencies must follow when they promulgate rules
requiring the use of private standards that are not printed in full in
the Code of Federal Regulations (``CFR'') (i.e., when they incorporate
private standards by reference). Section 51.1(f) of OFR's regulations
states that incorporation by reference is limited to the edition of the
publication that is approved by the Director of the Federal Register. 1
CFR 51.1(f). Section 51.9 of OFR's regulations requires that each
``incorporation by reference'' in a federal rule specifically identify
the standard to be incorporated, including the title, date, edition,
author, publisher, and identification number of the publication. 1 CFR
51.9.
Under Federal Register requirements, therefore, the Commission does
not have discretion to require compliance generally with the ``latest''
or ``current'' version of ASTM test procedures or other standards. If
ASTM adopts and publishes revised test procedures or other standards
required by the Rule, however, the Commission may update its
incorporation by reference of these standards by obtaining permission
for the incorporation by reference from the Director of the Federal
Register and publishing an amendment to the Rule that requires the use
of the revised standard in the future.
ASTM standards C 177-85, C 236-87, C 518-85, C 976-82, C 1045-85,
and C 739-88, which currently are specified in the Rule, have been
revised by ASTM since the Commission adopted those versions of the
standards in 1990.56 Because the Commission has taken no action to
consider any of the revised standards adopted by ASTM, and has received
no petitions to consider them, section 460.7 of the Rule has
authorized, but not required, use of the revised ASTM standards for
compliance with the Rule.
\56\ 55 FR 10053 (1990).
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Based on the comments and the text of the revised versions of the
ASTM standards recommended by the commenters, the Commission believes
that these revisions to the versions of the standards currently
required by the Rule have been primarily technical changes or editorial
comments, and not significant, substantive revisions. The
[[Page 13663]]
Commission, therefore, amends the Rule to require use of the revised,
current versions of these standards that are published in volume 04.06,
section 4, of the 1995 Annual Book of ASTM Standards. Because the
revisions appear to be technical changes or editorial comments, not
significant, substantive revisions, the Commission determines that
these amendments are non-substantive under section 18(d)(2)(B) of the
FTC Act, 15 U.S.C. 57a(d)(2)(B).
The amendments require that all future tests by manufacturers or
others to substantiate R-value claims for home insulation products be
based on the revised standards. Manufacturers or others whose home
insulation products have not changed can continue to rely on tests
conducted according to the versions of the standards that were required
by the Rule at the time the tests were conducted. Under section 460.7
of the Rule, in the future the Commission will accept, but not require,
the use of a revised version of any of these standards 90 days after
ASTM adopts and publishes the revision. The Commission may, however,
reopen the rulemaking proceeding during the 90-day period or at any
later time to consider whether it should require use of the revised
procedure or reject it under section 460.5 of the Rule, 16 CFR 460.5.
V. Proposed Non-Substantive Amendment to Allow Use of an Additional
ASTM R-value Test Procedure
In the April 6, 1995 notice, the Commission also solicited comments
on the Petition from Ronald S. Graves, Research Staff Member, Materials
Analysis Group, at Martin Marietta Energy Systems, Inc.57 The
Petition requested that the Commission include an additional (fifth)
ASTM R-value test procedure (``ASTM C 1114-92--Standard Test Method for
Steady-State Thermal Transmission Properties by Means of the Thin-
Heater Apparatus''), as an approved test method for complying with
section 460.5(a) of the R-value Rule, 16 CFR 460.5(a). This test method
is under the jurisdiction of ASTM Committee C-16 on Thermal
Measurements (the ASTM Committee responsible for the other R-value test
procedures required by the R-value Rule), and is the direct
responsibility of ASTM Subcommittee C16.30 on Thermal Measurements. Mr.
Graves is the Chairman of the Thin Heater Task Group within C16.30 that
meets semiannually to maintain and keep ASTM C 1114 current.
\57\ 60 FR at 17493-94. Martin Marietta Energy Systems, Inc.,
operates Oak Ridge National Laboratory (``ORNL'') as a contractor
for the U.S. Department of Energy. The Petition, plus attachments,
has been placed on the public record of the R-value Rule, File No.
R811001, and can be inspected at the Commission's Public Reference
Room, Room 130, Sixth Street and Pennsylvania Avenue, NW,
Washington, DC.
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Based on the documentation submitted with the Petition, the
Commission stated its belief that the accuracy of the ASTM C 1114-92
test procedure compared favorably to that of other ASTM R-value test
procedures the Commission has adopted under the R-value Rule.58
The Commission, therefore, stated that it was considering adopting a
non-substantive amendment to section 460.5(a) of the Rule to include
ASTM C 1114-92 as an optional, but not required, test procedure for
determining the R-value of home insulation. Because the proposed
amendment would not impose any new obligations upon parties covered by
the Rule, or lessen the protections afforded consumers by the Rule, the
Commission stated that the proposed change appeared to be non-
substantive under section 18(d)(2)(B) of the FTC Act, 15 U.S.C.
57a(d)(2)(B). For these reasons, the Commission stated that it did not
have to solicit public comment or follow the rulemaking proceedings
that would be required for a substantive amendment to the Rule. On the
other hand, because the Commission was soliciting comments as part of
its regulatory review of the Rule, as a matter of discretion the
Commission determined to solicit comments on the Petition at the same
time.
\58\ The Commission noted that C 1114-92 had been adopted as an
official ASTM standard and, therefore, it appeared that the industry
recognized it as an accurate and appropriate test procedure.
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Twelve comments addressed the proposed adoption of ASTM C 1114-92
as an optional R-value test procedure. Nine comments recommended that
the Commission adopt the test procedure or said that they had no
objections.59 Of these, Regal stated that the adoption of the test
procedure was ``appropriate.'' Celotex and PIMA stated that the test
procedure has shown excellent correlation to the R-value test
procedures currently required by the Rule. ORNL/Wilkes stated that the
test procedure is a test method that has proven minimal uncertainty,
high reproducibility, and broad applicability to a variety of existing
and advanced insulation materials.
\59\ Tierra, #12, at 1-3; Fi-Foil/Nowman, #15, at 1; Regal, #16,
at 1; England, #18, at 4; Hamilton, #22, at 3; Celotex, #25, at 6;
PIMA, #30, at 8; Fi-Foil/Lippy, #42; ORNL/Wilkes, #29, at 2.
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Three comments expressed reservations about the proposed adoption
of ASTM C 1114-92. Rock Wool Mfg./1 agreed that the Commission's
proposal to adopt the test procedure would be appropriate, if the
Commission is assured that the results are comparable with other
required tests.60 Western stated that adding C 1114-92 may help
reduce burdens or costs imposed by the Rule,61 but later responded
specifically to the issue of adopting the test procedure with ``no
comment.'' 62 MRCA expressed concern that the test procedure would
replace ASTM tests C 177 and C 518, that only two pieces of equipment
currently are available to conduct the C 1114 test, that available test
equipment is proprietary, and that more labs should use the equipment
to obtain comparable test results before the FTC accepts the
procedure.63
\60\ Rock Wool Mfg./1, #06.
\61\ Western, #14, at 2.
\62\ Id. at 3.
\63\ MRCA, #31, at 1-2.
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The Commission has determined to adopt a non-substantive amendment
to allow use of ASTM C 1114-95 as an optional, but not required, test
method for determining the R-value of home insulation under section
460.5(a) of the R-value Rule.64 Based on the data submitted with
the Petition and the comments, the Commission believes that the
accuracy of the ASTM C 1114-95 test procedure compares favorably with
the other ASTM R-value test procedures the Commission has adopted under
the R-value Rule. Because the amendment imposes no new obligations upon
parties covered by the Rule (but merely recognizes the use of an
optional R-value test procedure), and because the accuracy of the test
procedure compares favorably to the test procedures already required by
the Rule, the Commission has determined that this amendment is non-
substantive under section 18(d)(2)(B) of the FTC Act, 15 U.S.C.
57a(d)(2)(B).
\64\ ASTM published revised version C 1114-95 of the standard in
August 1995, after the comment period ended. According to the
petitioner, the revised version contains merely technical,
housekeeping changes. The Commission, therefore, considers the
documentation in support of the Petition and the comments to apply
to revised version C 1114-95. Graves, #43.
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VI. Other Issues
In addition to the subjects discussed above, the comments raised
numerous other issues relating to the Rule. For example:
Whether the scope of the Rule should be expanded to cover
insulation sold for use in the commercial market, the thermal
efficiency of building systems (such as insulation used in structural
panels), or new products
[[Page 13664]]
(such as cellulose batts, cotton batts, cotton loose-fill, stabilized
cellulose);
Whether the Rule should require different or new
procedures or specify additional requirements for preparing test
specimens for certain types of insulation products (such as aging
cellular plastics insulations, determining the long-term density of
loose-fill mineral fiber insulations);
Whether the Rule should take into consideration additional
factors that can affect the thermal performance of specific products in
actual use (such as temperature differences, the effect of convection
during winter conditions); and
Whether the Rule should impose additional requirements on
manufacturers or installers to help consumers ensure that the requisite
amount of insulation has been installed in their homes.
Adopting the commenters' recommendations to cover, for example,
additional products and to create new Rule requirements would require
substantive amendments under section 18(d)(2)(B) of the FTC Act, 15
U.S.C. 57a(d)(2)(B). In addition, some of the comments suggested
requiring the use of specific proposed ASTM test procedures when ASTM
adopts them as final procedures. Because these test procedures are not
yet final ASTM standards, it is premature for the Commission to
consider requiring that they be used to determine the R-values of home
insulation products.
The Commission is continuing to review the issues raised by the
comments and the most efficient and effective methods of dealing with
them, which may not necessarily include further rulemaking. For
example, the Commission could bring enforcement actions against
specific companies whose practices are not covered by the Rule, but who
are engaging in unfair or deceptive acts or practices under section 5
of the FTC Act, 15 U.S.C. 45. Another option might be for the
Commission to provide affected industry members informal guidance
instead of adopting substantive amendments to the Rule. The Commission
will address these other issues in other notices or forums.
VII. Exemptions
Section 18(g)(2) of the FTC Act, 15 U.S.C. 57a(g)(2), authorizes
the Commission to exempt a person or class of persons from all or part
of a trade regulation rule if the Commission finds that application of
the rule is not necessary to prevent the unfair or deceptive acts or
practices to which the rule relates. Since the R-value Rule became
effective, the Commission, in response to petitions from industry
representatives, has granted exemptions from specific requirements of
the Rule to certain classes of sellers. The Commission granted these
exemptions after soliciting public comment.
Although the Commission published the exemptions in the Federal
Register, the exemptions are not cited in the text of the Rule in the
Code of Federal Regulations. To assist industry members in
understanding their responsibilities under the Rule, the Commission has
determined to amend the Rule to include a summary of the exemptions as
an Appendix to the Rule. These non-substantive amendments do not alter
the requirements of the Rule. They merely summarize the previously-
granted exemptions as an Appendix to the Rule for easier reference.
Industry members should review the decisions published in the Federal
Register where the Commission granted the exemptions for a more
complete description of the scope of the exemptions. The summaries in
the Appendix include the citations to those decisions.
A. Manufacturers of Perlite Insulation
The Commission granted the first exemption in response to a
petition from a trade association representing manufacturers of perlite
insulation products, 46 FR 22179 (1981). The petitioner requested that
the Commission exempt manufacturers of perlite insulation from sections
460.12(b)(2) and 460.13(c)(1) of the Rule, 16 CFR 460.12(b)(2),
460.13(c)(1), which require that they disclose on labels and fact
sheets the minimum weight per square foot of perlite insulation
products that is necessary to achieve a specific R-value.
The Rule's label and fact sheet disclosure requirements were based
on the fact that, for most insulation products, as the density
increases, the R-value per unit of thickness increases. The Rule,
therefore, requires that sellers of loose-fill insulations, including
perlite, disclose the minimum weight per square foot that is required
to achieve the density and thickness necessary for the claimed total R-
value. Unlike other insulation products, however, as the density of
most perlite insulation increases, the R-value per unit of thickness
decreases. Thus, if these perlite insulations are installed at
densities greater than the thicknesses and weights per square foot
listed on their labels and fact sheets, the consumer may not receive
the claimed R-values. The petitioner requested that the label and fact
sheet disclosure requirements be changed to require disclosure of
maximum weight per square foot.
The Commission exempted manufacturers of perlite insulation
products that have an inverse relationship between R-value and density
or weight per square foot from the requirements in sections
460.12(b)(2) and 460.13(c)(1) of the Rule that they disclose minimum
weight per square foot for R-values listed on labels and fact sheets.
The exemption is conditioned upon the alternative disclosure in labels
and fact sheets of the maximum weight per square foot for each R-value
listed. All other requirements of the Rule apply to sellers of these
perlite home insulation products.
B. Manufacturers of Rigid, Flat-Roof Insulation
The Commission granted the second exemption in response to
petitions filed by four manufacturers of rigid, flat-roof insulation
products and two trade associations representing such manufacturers, 46
FR 22180 (1981). One of the trade associations and all four
manufacturers requested an exemption from all requirements of the Rule
for rigid, flat-roof insulation products that are used in flat, built-
up roofs. The other trade association limited its request to an
exemption from the labeling requirements of section 460.12 of the Rule,
16 CFR 460.12.
The petitioners stated that more than 95 percent of the rigid,
flat-roof insulation boards sold were used in commercial or industrial
buildings and, therefore, were not covered by the Rule. They
acknowledged, however, that some of the products were used in multi-
family residential buildings, such as flat-roof apartments or
condominium buildings. The petitioners stated that manufacturers have
no way of knowing which products would be used in residential
applications. If manufacturers were required to label all products for
residential use according to the Rule, they would be required to assume
the unnecessary expense of labeling every package of insulation even
though only a small percentage would be used in residential
applications. Furthermore, since these products were used primarily in
large, multi-family, flat-roof buildings, petitioners asserted that the
labeling information was unnecessary because the product generally
would be selected by an architect or another professional, not the
ultimate consumer.
The Commission exempted manufacturers of rigid, flat-roof
insulation products that are used in flat, built-up roofs from the
requirement in
[[Page 13665]]
section 460.12 that all insulation products that might be used in
residential buildings be labeled with required R-value information. All
other requirements of the Rule apply to sellers of these products.
C. New Home Sellers
The Commission granted the third exemption in response to a
petition filed by a trade association representing new home sellers, 48
FR 31192 (1983). The petitioner requested that new home sellers be
exempted from certain requirements of sections 460.18 and 460.19 of the
Rule, 16 CFR 460.18, 460.19. Section 460.18 requires that
advertisements and other promotional materials that make certain claims
about a home insulation product include specific disclosures. Section
460.19 requires that ads and other promotional materials that claim
home insulation can cut fuel bills or fuel use (``energy savings
claims'') include specific disclosures, and that advertisers have a
reasonable basis for the claims and maintain records substantiating the
claims.
The Commission determined that certain disclosures in new home
advertisements and other promotional materials, which would have been
required by the Rule, were not necessary to prevent the unfair or
deceptive acts or practices to which the Rule relates. The Commission,
therefore, exempted new home sellers from:
(1) The requirement, under section 460.18(a), that they disclose
the type and thickness of the insulation when they make a
representation about the R-value of the insulation in a new home;
(2) the requirement that they disclose the R-value explanatory
statement under section 460.18(a) or the savings explanatory
statement under section 460.19(b), conditioned upon the new home
seller alternatively disclosing the appropriate explanatory
statement in the sales contract along with the disclosures required
by section 460.16, 16 CFR 460.16; 65
\65\ Under section 460.19(d), ads or other promotional materials
that otherwise would require both the R-value explanatory statement
under section 460.18(a) and the savings claim explanatory statement
under section 460.19(b) need only contain the savings claim
explanatory statement. This option applies under the exemption to
new home sellers who choose to make the explanatory statement in the
sales contract instead of in the ad or other promotional material.
---------------------------------------------------------------------------
(3) the requirement that they make the disclosures specified in
section 460.19(c) if they claim that insulation, along with other
products in a new home, will cut fuel bills or fuel use; and
(4) the requirement that they include the reference to fact
sheets when they must disclose the R-value explanatory statement or
the savings claim explanatory statement under sections 460.18(a) or
460.19(b), respectively.
These exemptions also apply to home insulation sellers other than
new home sellers (such as home insulation manufacturers) when they
participate with a new home seller to advertise and promote the sale of
new homes, provided that the primary thrust of the advertisement or
other promotional material is the promotion of new homes, and not the
promotion of the insulation product. All other requirements of the
Rule, including the section 460.19 substantiation and recordkeeping
requirements for energy savings claims made in ads and other
promotional materials, apply to new home sellers and those who
participate with a new home seller to advertise and promote the sale of
new homes or home insulation products.
VIII. Summary of Commission's Determinations
For the reasons set forth in this notice, the Commission: 66
(1) retains the R-value Rule; (2) adopts a non-substantive amendment to
section 460.5(a) of the Rule to allow the use of ASTM C 1114-95 as an
optional, but not required, test procedure to determine the R-value of
home insulation; (3) adopts non-substantive amendments to sections
460.5(a), 460.5(a)(2), 460.5(b), and 460.5(d)(1) of the Rule to require
the use of ASTM C 177-85 (1993), ASTM C 236-89 (1993), ASTM C 518-91,
ASTM C 976-90, ASTM C 1045-90, and ASTM C 739-91 to determine the R-
value of home insulation; (4) adopts a non-substantive amendment to add
an Appendix to the Rule, summarizing the exemptions from specific
requirements of the Rule that the Commission previously granted for
certain classes of persons covered by the Rule; and (5) adopts a non-
substantive amendment to revise section 460.10 to cross-reference the
Commission's enforcement policy statement for foreign language
advertising in 16 CFR 14.9 and to delete the current Appendix to the
Rule, which merely repeats the text of 16 CFR 14.9.
\66\ In addition to the amendments described in the text of this
notice, the Commission also adopts a non-substantive amendment to
section 460.10 and removes the current Appendix (``Enforcement
Policy Statement for Foreign Language Advertising''). Section 460.10
previously required compliance with the disclosure requirements
described in the Appendix. The Appendix simply reprinted 16 CFR
14.9. Amended section 460.10 refers directly to 16 CFR 14.9,
eliminating unnecessary duplication.
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List of Subjects in 16 CFR Part 460
Advertising, Incorporation by reference, Insulation, Labeling,
Trade practices.
Text of Amendments
Accordingly, the Commission amends 16 CFR Part 460 to read as
follows:
PART 460--[AMENDED]
1. The authority citation for Part 460 is amended to read as
follows:
Authority: 15 U.S.C. 41 et seq.
2. In section 460.5, the introductory text, paragraph (a)
introductory text, paragraphs (a)(2) and (b), paragraph (d)
introductory text and paragraph (d)(1) are revised to read as follows:
Sec. 460.5 R-value tests.
R-value measures resistance to heat flow. R-values given in labels,
fact sheets, ads, or other promotional materials must be based on tests
done under the methods listed below. They were designed by the American
Society of Testing and Materials (ASTM). The test methods are:
(a) All types of insulation except aluminum foil must be tested
with ASTM C 177-85 (Reapproved 1993), ``Standard Test Method for
Steady-State Heat Flux Measurements and Thermal Transmission Properties
by Means of the Guarded-Hot-Plate Apparatus;'' ASTM C 236-89
(Reapproved 1993), ``Standard Test Method for Steady-State Thermal
Performance of Building Assemblies by Means of a Guarded Hot Box;''
ASTM C 518-91, ``Standard Test Method for Steady-State Heat Flux
Measurements and Thermal Transmission Properties by Means of the Heat
Flow Meter Apparatus;'' ASTM C 976-90, ``Standard Test Method for
Thermal Performance of Building Assemblies by Means of a Calibrated Hot
Box;'' or ASTM C 1114-95, ``Standard Test Method for Steady-State
Thermal Transmission Properties by Means of the Thin-Heater
Apparatus.'' The tests must be done at a mean temperature of 75 deg.
Fahrenheit. The tests must be done on the insulation material alone
(excluding any airspace). R-values (``thermal resistance'') based upon
heat flux measurements according to ASTM C 177-85 (Reapproved 1993) or
ASTM C 518-91 must be reported only in accordance with the requirements
and restrictions of ASTM C 1045-90, ``Standard Practice for Calculating
Thermal Transmission Properties from Steady-State Heat Flux
Measurements.'' These incorporations by reference were approved by the
Director of the Federal Register in accordance with 5 U.S.C. 552(a) and
1 CFR Part 51. Copies of the test procedures and standard practice may
be obtained from the American Society of Testing and Materials, 1916
Race Street, Philadelphia, PA 19103.
[[Page 13666]]
Copies may be inspected at the Federal Trade Commission, Public
Reference Room, Room 130, Sixth Street and Pennsylvania Ave., NW,
Washington, DC, or at the Office of the Federal Register, 800 North
Capital St., NW, suite 700, Washington, DC.
(1) * * *
(2) For loose-fill cellulose, the tests must be done at the settled
density determined under paragraph 8 of ASTM C 739-91, ``Standard
Specification for Cellulosic Fiber (Wood-Base) Loose-Fill Thermal
Insulation.'' This incorporation by reference was approved by the
Director of the Federal Register in accordance with 5 U.S.C. 552(a) and
1 CFR Part 51. Copies of the test procedure may be obtained from the
American Society of Testing and Materials, 1916 Race Street,
Philadelphia, PA 19103. Copies may be inspected at the Federal Trade
Commission, Public Reference Room, Room 130, Sixth Street and
Pennsylvania Ave., NW, Washington, DC, or at the Office of the Federal
Register, 800 North Capital St., NW, suite 700, Washington, DC.
* * * * *
(b) Aluminum foil systems with more than one sheet must be tested
with ASTM C 236-89 (Reapproved 1993) or ASTM C 976-90, which are
incorporated by reference in paragraph (a) of this section. The tests
must be done at a mean temperature of 75 deg. Fahrenheit, with a
temperature differential of 30 deg. Fahrenheit.
* * * * *
(d) For insulation materials with foil facings, you must test the
R-value of the material alone (excluding any air spaces) under the
methods listed in paragraph (a) of this section. You can also determine
the R-value of the material in conjunction with an air space. You can
use one of two methods to do this:
(1) You can test the system, with its air space, under ASTM C 236-
89 (Reapproved 1993) or ASTM C 976-90, which are incorporated by
reference in paragraph (a) of this section. If you do this, you must
follow the rules in paragraph (a) of this section on temperature, aging
and settled density.
* * * * *
3. Section 460.10 is revised to read as follows:
Sec. 460.10 How statements must be made.
All statements called for by this regulation must be made clearly
and conspicuously. Among other things, you must follow the Commission's
enforcement policy statement for clear and conspicuous disclosures in
foreign language advertising and sales materials, 16 CFR 14.9.
4. The ``Appendix to Part 460--Enforcement Policy Statement for
Foreign Language Advertising'' is removed.
5. A new Appendix is added, to read as follows:
Appendix to Part 460--Exemptions
Section 18(g)(2) of the Federal Trade Commission Act, 15 U.S.C.
57a(g)(2), authorizes the Commission to exempt a person or class of
persons from all or part of a trade regulation rule if the
Commission finds that application of the rule is not necessary to
prevent the unfair or deceptive acts or practices to which the rule
relates. In response to petitions from industry representatives, the
Commission has granted exemptions from specific requirements of 16
CFR Part 460 to certain classes of sellers. Some of these exemptions
are conditioned upon the performance of alternative actions. The
exemptions are limited to specific sections of Part 460. All other
requirements of Part 460 apply to these sellers. The exemptions are
summarized below. For an explanation of the scope and application of
the exemptions, see the formal Commission decisions in the Federal
Register cited at the end of each exemption.
(a) Manufacturers of perlite insulation products that have an
inverse relationship between R-value and density or weight per
square foot are exempted from the requirements in sections
460.12(b)(2) and 460.13(c)(1) that they disclose minimum weight per
square foot for R-values listed on labels and fact sheets. This
exemption is conditioned upon the alternative disclosure in labels
and fact sheets of the maximum weight per square foot for each R-
value required to be listed. 46 FR 22179 (1981).
(b) Manufacturers of rigid, flat-roof insulation products used
in flat, built-up roofs are exempted from the requirements in
section 460.12 that they label these home insulation products. 46 FR
22180 (1981).
(c) New home sellers are exempted from:
(1) the requirement in section 460.18(a) that they disclose the
type and thickness of the insulation when they make a representation
in an advertisement or other promotional material about the R-value
of the insulation in a new home;
(2) the requirement that they disclose in an advertisement or
other promotional material the R-value explanatory statement
specified in section 460.18(a) or the savings explanatory statement
specified in section 460.19(b), conditioned upon the new home
sellers alternatively disclosing the appropriate explanatory
statement in the sales contract along with the disclosures required
by section 460.16;
(3) the requirement that they make the disclosures specified in
section 460.19(c) if they claim that insulation, along with other
products in a new home, will cut fuel bills or fuel use; and
(4) the requirement that they include the reference to fact
sheets when they must disclose the R-value explanatory statement or
the savings claim explanatory statement under sections 460.18(a) or
460.19(b), respectively.
The exemptions for new home sellers also apply to home
insulation sellers other than new home sellers when they participate
with a new home seller to advertise and promote the sale of new
homes, provided that the primary thrust of the advertisement or
other promotional material is the promotion of new homes, and not
the promotion of the insulation product. 48 FR 31192 (1983).
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 96-7528 Filed 3-27-96; 8:45 am]
BILLING CODE 6750-01-P
