2011-22593. Statutory Delays of Notifications and Prohibitions of Disclosure

AGENCY:

Federal Trade Commission.

ACTION:

Final rule.

SUMMARY:

The Federal Trade Commission (“FTC” or “Commission”) is establishing an internal procedure for delegating its authority to seek court orders to delay notification and prohibit disclosure of Commission compulsory process under the Right to Financial Privacy Act (RFPA), the Electronic Communications Privacy Act (ECPA), and the U.S. SAFE WEB Act (“SAFE WEB”). This procedure is intended to make the process for seeking such orders more administratively efficient.

DATES:

This final rule is effective September 2, 2011.

FOR FURTHER INFORMATION CONTACT:

Alex Tang, [e-mail], 202-326-2447; or W. Ashley Gum, [e-mail], 202-326-3006; Federal Trade Commission, Office of the General Counsel, 600 Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

The RFPA and the ECPA require the FTC, in certain cases, to notify customers when seeking their records from financial institutions or service providers subject to those statutes in the Commission's law enforcement investigations and proceedings. See 12 U.S.C. 3405 (RFPA); 18 U.S.C. 2703(b)(1)(B) (ECPA). These statutes, and SAFE WEB, also authorize the filing of an application seeking an order to delay such notification and to prohibit the recipient of the agency's compulsory process from disclosing that the FTC has requested or received the records, where such notice or disclosure would jeopardize the FTC's investigation. See 12 U.S.C. 3409 (RFPA); 18 U.S.C. 2705 (ECPA); see also 15 U.S.C. 57b-2a(b) (SAFE WEB). In cases where these statutes do not require customer notification, SAFE WEB separately authorizes the FTC to seek an order prohibiting the recipient of FTC compulsory process from disclosing the existence of such process to any person. See 15 U.S.C. 57b-2a(c).

Under this final rule, delegating the Commission's authority pursuant to Reorganization Plan No. 4 of 1961, 26 FR 6191, either an individual Commissioner or the General Counsel may authorize the staff to file actions seeking delay of notification and prohibition of disclosure under the statutes cited above. This delegation will facilitate the Commission's exercise of this authority and, as solely a matter of internal agency administration, is not intended to confer any enforceable right, privilege, or benefit on behalf of any person.

Procedural Requirements

A. Administrative Procedure Act

The FTC has determined that publication of this rule without prior notice and the opportunity for public comment is warranted because this is a rule of agency procedure and practice and therefore is exempt from notice and comment rulemaking requirements of the Administrative Procedure Act, 5 U.S.C. 553(b)(A). Because it is a non-substantive rule, the Commission shall make the rule effective immediately upon publication. See 5 U.S.C. 553(d)(2).

B. Regulatory Flexibility Act

Because the Commission has determined that it may issue this rule without public comment, the Commission is also not required to publish any initial or final regulatory flexibility analysis under the Regulatory Flexibility Act as part of such action. See 5 U.S.C. 601(2), 604(a).

C. Paperwork Reduction Act of 1995

The final rule is not subject to the Paperwork Reduction Act (44 U.S.C. 3501 et seq.) because it does not contain any new information collection requirements.

List of Subjects in 16 CFR Part 2

• Administrative practice and procedure

For the reasons set forth above, the Federal Trade Commission is amending Subpart A of part 2 of title 16, Code of Federal Regulations, as follows:

PART 2—NONADJUDICATIVE PROCEDURES

1. The authority citation for part 2 continues to read as follows:

Authority: 15 U.S.C. 46, unless otherwise noted.

Subpart A—Inquiries; Investigations; Compulsory Processes

2. Add § 2.17 to read as follows:

§ 2.17

Statutory delays of notifications and prohibitions of disclosure.

Upon authorization by the Commissioner who issues compulsory process pursuant to § 2.7(a) or, alternatively, upon authorization by the General Counsel, Commission attorneys may seek to delay notifications or prohibit disclosures pursuant to the Right to Financial Privacy Act (12 U.S.C. 3409), the Electronic Communications Privacy Act (18 U.S.C. 2705), or section 7 of the U.S. SAFE WEB Act (15 U.S.C. 57b-2a).

By direction of the Commission.

Donald S. Clark,

Secretary.