NRF’s new Remote Commerce Taxation Working Group has hit the ground running. This retail only coalition, which supports equitable sales tax collection obligations regardless of delivery channel, was successful last week in postponing Senate Commerce Committee action that did not provide equal collection obligations for all retailers.

Efforts have now shifted to the House, where the House Commerce Committee is expected to hold a hearing on Wednesday, May 3 and the House Judiciary Committee will hold a hearing on Wednesday, May 17, 2000, to extend the Internet Tax Freedom Act (ITFA). Retailers should urge Congress to oppose any extension of the ITFA that does not address the sales and use tax issue in a manner that is fair for everyone. Retailers only want a “level playing field," where a product is taxed (or not taxed) the same regardless of how it is ordered or delivered. Unfortunately, almost all Congressional proposals to extend the ITFA do not address the more controversial sales and use tax issue.

Retailers are encouraged to contact Republican leaders in the House and Senate, as well as House Commerce and Judiciary Committee members, and demand that they provide retailers a level tax playing field. Members can be reached through the Capitol Switchboard at (202) 224-3121.

If you have any questions, please contact Scott Cahill or Emily Wild at (202) 783-7971.

Shortly before the Easter recess, House and Senate conferees on the Africa/Caribbean Basin Initiative bill made a major breakthrough that could lead to completion of a conference report.

The agreement offers preferences to knit apparel made from regional fabric, while maintaining regional fabric provisions in the CBI section (i.e., apparel made from U.S. fabric) of the Senate bill. The regional fabric cap would grow over time, although by how much has yet to be worked out. NRF has suggested to Congressional staff that the growth of the cap each year should equal the annual average growth in all textile and apparel imports from the CBI calculated over the previous five years.

On the African trade provisions, the bill would give duty free and quota free treatment to apparel made in the sub-Saharan Africa region from regional fabric, subject to a cap set initially at 1.5% of total U.S. apparel imports and rising to 3.5% over 8 years. In addition, the cap would not apply to apparel made in the least developed countries from third-country fabric for four years. Textiles and fabric imported into the U.S. from Africa would not be eligible for duty-free and quota-free treatment.

Conferees have yet to address the issue of the extraneous trade amendments added by the Senate. NRF has expressed opposition to one of these amendments - the so-called “carousel sanctions” provision - and serious reservations about two others - a child labor provision and the jewelry marking provision.

The child labor provision, which is being pushed by Senator Tom Harkin (D-IA), would stipulate that countries would only enjoy the trade benefits from the Africa/CBI bill if they adhere to strict new standards on child labor. The provision applies not only to African and CBI nations, but to any country that uses the Generalized System of Preferences (GSP). The question of how the U.S. could measure or enforce these new standards has yet to be answered.

If you have any questions, please contact Erik Autor at (202) 626-8104.

On April 21, the first law to regulate privacy on the Internet went into effect. The Children's Online Privacy Protection Act (COPPA), passed two years ago, requires websites to receive "verifiable parental consent" before collecting personally identifiable information about children under 13 years of age. The law applies to data such as full names, addresses, or any information that identifies or allows someone to contact a child.

The Federal Trade Commission (FTC) announced it would randomly check websites every day for violations of COPPA. "The bottom line is that we will be enforcing this law and we will be looking at violators closely," said Loren Thompson, an attorney with the FTC.

Web operators will have several methods to receive parental approval: faxes, phone calls, U.S. mail, or credit card numbers, which are often used as proof of age. If the information collected will only be used internally by the website that collects it, permission granted by email will be considered sufficient if the company takes additional steps to confirm the parent's identity. Parents will also be allowed to review information collected and have information previously collected removed from company's databases.

Some industry experts have said that web-savvy children will be able to provide false parental permission. The FTC responded by stating companies should use "digital signature" technology to prevent such forgeries.

The regulations on COPPA are available on the FTC's website. If you are unsure if your company is in compliance, please consult the regulations at http://www.ftc.gov/bcp/conline/pubs/buspubs/coppa.htm.

If you have any questions, please contact Sarah Whitaker at (202) 626-8109.

Several weeks ago, the Federal Trade Commission announced a five year, top-to-bottom review of the Telemarketing Consumer Fraud and Abuse Act (Telemarketing Sales Rule). This very broad rule governs many aspects of retailers’ marketing efforts, including whether the industry is in compliance with the fairly complicated ‘Do Not Call’ provisions of the Telephone Consumer Protection Act. At that time, NRF was invited to testify as part of the Commission’s initial review of its enforcement of the controversial ‘Do Not Call’ rules.

The rule review notice explains the other areas on which the Commission seeks comment for possible rule modification. It asks how broadly the Telephone Sales Rules should be applied (e.g. should Internet sales be subject to the rules); whether the record keeping provisions are too burdensome; whether there are conflicts between the Commission’s rules and state law requirements; and whether technology has made portions of the rules unduly burdensome or obsolete. The notice can be accessed at www.ftc.gov/bcp/rulemaking/tsr/tsr-review.htm.

The deadline for filing comments was April 27. NRF has been advised that the Commission would welcome our industry’s views, and has requested an extension of time in order to prepare the type of strong, substantive and ultimately beneficial comments NRF provided five years ago when the rules were first being drafted. However, NRF will not prepare comments unless we have a clear indication that a significant number of NRF members will take advantage of this opportunity to modify the rules. If your company would like to help draft comments for the FTC, please contact Mallory Duncan at (202) 783-7971.

Easter generated approximately $1.06 billion in sales this year.  Easter is second to Christmas in candy sales.

Washington Leadership Conference, June 13-14, Washington, DC
For registration information, contact Emily Wild at (202) 626-8131.

Washington Retail Insight is published by the National Retail Federation, 325 7th Street, NW, Suite 1000, Washington, DC 20004. Please contact Mike Epstein at (202) 783-7971 or e-mail with comments, suggestions, or for subscription information.