FTC Amends Cooling-off Rule for Door-to-Door Sales | Practical Law

FTC Amends Cooling-off Rule for Door-to-Door Sales | Practical Law

The Federal Trade Commission (FTC) has amended its Rule Concerning Cooling-Off Period for Sales Made at Home or at Certain Other Locations (Cooling-Off Rule) that regulates door-to-door sales.

FTC Amends Cooling-off Rule for Door-to-Door Sales

Practical Law Legal Update 3-595-0828 (Approx. 4 pages)

FTC Amends Cooling-off Rule for Door-to-Door Sales

by Practical Law Commercial
Published on 07 Jan 2015 • USA (National/Federal)
The Federal Trade Commission (FTC) has amended its Rule Concerning Cooling-Off Period for Sales Made at Home or at Certain Other Locations (Cooling-Off Rule) that regulates door-to-door sales.
On January 6, 2015 the Federal Trade Commission (FTC) announced that it has amended the definition of door-to-door sale under the Rule Concerning Cooling-Off Period for Sales Made at Homes or at Certain Other Locations (Cooling-Off Rule), which regulates direct sales to consumers that occur outside of a seller's permanent place of business. The Cooling-Off Rule provides that:
  • Consumers have the right to unilaterally cancel door-to-door sales within three business days of the sale.
  • Sellers must provide buyers with oral and written notice of their cancellation rights.
  • It is unfair and deceptive, under Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45), when sellers fail to either:
    • notify consumers of their cancellation rights; or
    • honor cancellations.
(16 C.F.R. Part 429.)
The new definition of door-to-door sale distinguishes between sales that occur:
  • In a buyer's home, which are covered if the purchase price of the sale is $25 or more.
  • At other locations, which are now covered only if the purchase price of the sale is $130 or more.
This change becomes effective on March 13, 2015.