Emergency Supporting Statement_July 27 2023_Final

Request for an Emergency Exception
Supporting Statement
1. Necessity for Collecting the Information
The Federal Cigarette Labeling and Advertising Act, 15 U.S.C. 1331 et seq. (“FCLAA”),
prohibits cigarette manufacturers and importers from manufacturing, packaging, importing for
sale, or distributing cigarettes within the United States unless the packages bear one of four
statutorily-prescribed Surgeon General’s health warnings. Additionally, cigarette advertising is
also prohibited unless it bears statutorily-prescribed health warnings.
The FCLAA further provides that the health warnings “shall be rotated by each
manufacturer or importer . . . quarterly in alternating sequence on packages of each brand of
cigarettes manufactured by the manufacturer or importer and in the advertisements for each such
brand of cigarettes in accordance with a plan submitted by the manufacturer or importer and
approved by the Federal Trade Commission.” 15 U.S.C. 1333(c)(1). Accordingly, the
Commission collects information from manufacturers and importers that identifies the cigarette
brands and brand styles for which approval is sought and establishes how the applicant intends to
comply with the statutory warning requirements for packaging and advertising (if it intends to
engage in advertising). See 15 U.S.C. 1333(a).
The FCLAA does provide an exception to the requirement of quarterly rotation on
cigarette packages. Specifically, manufacturers and importers whose sales the previous fiscal
year satisfied two criteria can apply to the Commission for permission to display the Surgeon
General’s warnings “an equal number of times within the twelve-month period beginning on the
date of the approval by the Commission of the application.” 15 U.S.C. 1333(c)(2)(C).
Accordingly, the Commission collects sales information from these applicants. Moreover,
because eligibility for “equalization” of the Surgeon General’s warnings on packaging is based
upon the company’s sales for the prior fiscal year, manufacturers and importers who choose this
route must submit information to the FTC annually showing that they continue to meet the
statutory criteria. See 15 U.S.C. 1333(c)(2)(C).
2. Use of the Information
The Commission uses the information to assess—as it is required to do under the
FCLAA—whether a manufacturer or importer will display the Surgeon General’s health
warnings in compliance with the governing statutory provisions in the FCLAA. The
Commission also uses the sales information provided by companies applying for label
“equalization” to determine whether those applicants meet the statutory requirements for this
alternative to quarterly rotation.

3. Consideration to Use Improved Information Technology to Reduce Burden
Surgeon General’s health warning plans can be submitted electronically and nearly all of
the plans received by the Commission are submitted that way.
4. Efforts to Identify Duplication/Availability of Similar Information
The Commission is not aware that the information being collected concerning
compliance with the FCLAA’s health warning requirements is currently duplicated elsewhere.
Although the U.S. Food and Drug Administration issued an industry guidance document entitled
“Submission of Plans for Cigarette Packages and Cigarette Advertisements (Revised)” in July
2021 that reviewed the requirements that cigarette packaging and advertising plans will have to
address when the nine new health warnings set forth in the 2009 Family Smoking Prevention and
Tobacco Control Act go into effect, that guidance is nonbinding as a result of a federal court
ruling vacating FDA’s “Required Warnings for Cigarette Packages and Advertisements” rule in
December 2022.
5. Efforts to Minimize Burden on Small Businesses
A portion of the respondents will be small entities. However, the information being
collected is minimal and even the sales information that applicants for “equalization” must
submit if they seek this option is readily available within the business.
6. Consequences of Conducting Collection Less Frequently
The Commission collects information only once from cigarette manufacturers and
importers who rotate the warning statements on a quarterly basis, unless they decide to add new
cigarette brands or brand styles or revised packaging for existing brand styles, or new advertising
to their previously-approved plans.
In addition to a plan showing how the manufacturer or importer intends to comply with
the statutory warning requirements, the Commission also collects sales information annually
from manufacturers and importers who choose to equalize. As manufacturers and importers are
only eligible for equalization when their sales figures for the previous fiscal year fall below
certain statutorily-defined thresholds, this information collection is necessary in order for the
FTC to assess whether the manufacturer or importer meets the statutory requirements for
equalization. The Commission also collects information from these entities concerning new
cigarette brands, brand styles and packaging and new advertising before those cigarettes and
advertising enter the market.
Less frequent collection of this sales information would significantly impair the FTC’s
ability to evaluate whether these companies are eligible for equalization. As a result, the
companies would either be unable to sell their products (because they lack a plan approved by
the Commission, as required by the FCLAA) or they would have to change to quarterly rotation.
Less frequent collection of information as to new packaging or advertising would mean that the
companies could not introduce new packages or advertising to the marketplace.

7. Circumstances Requiring Collection Inconsistent with Guidelines
This collection of information is consistent with the provisions of FCLAA.
8. Consultation Outside the Agency
Special circumstances exist that require an emergency clearance pursuant to 5 C.F.R.
§ 1320.13(a). First, without the information, the FTC is unable to determine whether cigarette
manufacturers and importers are complying with the statutory requirements for cigarette
packaging. For this reason, any interruption in the FTC’s ability to carry out its statutory
mandate will likely result in public harm. See 5 C.F.R. § 1320.13(a)(2)(i). Second, because the
FTC is already collecting the information in accordance with its statutory mandate, “[t]he use of
normal clearance procedures is reasonably likely to . . . disrupt the collection of information.”
See 5 C.F.R. § 1320.13(a)(2)(iii). Finally, the collection of information is needed prior to the
expiration of established time periods and is essential to the mission of the agency. See 5 C.F.R.
§ 1320.13(a)(1).
9. Payments or Gifts to Respondents
Not applicable.
10. & 11. Assurances of Confidentiality and Matters of a Sensitive Nature
The Commission does post approved plans on its website but it redacts any sales
information submitted by applications for health warning label equalization.
12. Burden Estimate
The estimated burden of collecting this information is as follows:
an average of 41 approved plans each year from 2020-2022 = 41 total annual responses
x (8 hours average per manufacturer/importer)
= 328 annual hours for manufacturers/importers
x $50.90/hour for personnel1
$16,695 annual labor cost for manufacturers/importers.
13. Estimated Capital or Other Non-Labor Costs
The Commission believes that there are no current start-up costs or other capital costs
associated with the information collection.

1

This is derived from the average of the U.S. Bureau of Labor Statistics Occupational Employment and Wage
Statistics (May 2022) hourly wages for attorneys ($65.26) and business operation specialists ($36.53), as roughly
half of the plans submitted to the Commission are signed by attorneys and half by non-attorneys.
https://www.bls.gov/oes/current/oes stru.htm (Tables 23-1011, 13-1199).

14. Estimated Cost to the Federal Government
The Commission estimates that review and approval of health warning plans takes 0.2
federal work years, for a cost of $26,039 based on OPM’s 2023 pay table.
15. Program Changes or Adjustments
None.
16. Statistical Use of Information
The proposed collection does not employ statistical methods.
17. Display of Expiration Date for OMB Approval
Not applicable.
18. Exceptions to the Certification for Paperwork Reduction Act Submissions
Not applicable. No exceptions are being requested on the certification statement.