CODE OF FEDERAL REGULATIONS
TITLE 16--COMMERCIAL PRACTICES
CHAPTER I--FEDERAL TRADE COMMISSION
SUBCHAPTER D--TRADE REGULATION RULES
PART 429--COOLING-OFF PERIOD FOR DOOR-TO-DOOR SALES
§ 429.1 The Rule.
In connection with any door-to-door sale, it constitutes an unfair and deceptive act or practice for any seller to:
(a) Fail to furnish the buyer with a fully completed receipt or copy of any ontract pertaining to such sale at the time of its execution, which is in the same language, e.g., Spanish, as that principally used in the oral sales presentation and which shows the date of the transaction and contains the name
and address of the seller, and in immediate proximity to the space reserved in the contract for the signature of the buyer or on the front page of the receipt if a contract is not used and in bold face type of a minimum size of 10 points, a statement in substantially the following form:
"You, the buyer, may cancel this transaction at any time prior to midnight of
the third business day after the date of this transaction. See the attached
notice of cancellation form for an explanation of this right."
The seller may select the method of providing the buyer with the duplicate notice of cancellation form set forth in paragraph (b) of this section, provided however, that in the event of cancellation the buyer must be able to retain a complete copy of the contract or receipt. Furthermore, if both forms are not attached to the contract or receipt, the seller is required to alter the last sentence in the statement above to conform to the actual location of the forms.
(b) Fail to furnish each buyer, at the time the buyer signs the door-to-door sales contract or otherwise agrees to buy consumer goods or services from the seller, a completed form in duplicate, captioned either "NOTICE OF RIGHT TO CANCEL" or "NOTICE OF CANCELLATION," which shall (where applicable) contain in ten point bold face type the following information and statements in the same language, e.g., Spanish, as that used in the contract.
Notice of Cancellation
[enter date of transaction] ------------- (Date)
YOU MAY CANCEL THIS TRANSACTION, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN
THREE BUSINESS DAYS FROM THE ABOVE DATE.
IF YOU CANCEL, ANY PROPERTY TRADED IN, ANY PAYMENTS MADE BY YOU UNDER THE
CONTRACT OR SALE, AND ANY NEGOTIABLE INSTRUMENT EXECUTED BY YOU WILL BE RETURNED WITHIN 10 BUSINESS DAYS FOLLOWING RECEIPT BY THE SELLER OF YOUR CANCELLATION NOTICE, AND ANY SECURITY INTEREST ARISING OUT OF THE TRANSACTION WILL BE CANCELED.
IF YOU CANCEL, YOU MUST MAKE AVAILABLE TO THE SELLER AT YOUR RESIDENCE, IN
SUBSTANTIALLY AS GOOD CONDITION AS WHEN RECEIVED, ANY GOODS DELIVERED TO YOU
UNDER THIS CONTRACT OR SALE; OR YOU MAY IF YOU WISH, COMPLY WITH THE
INSTRUCTIONS OF THE SELLER REGARDING THE RETURN SHIPMENT OF THE GOODS AT THE
SELLER'S EXPENSE AND RISK.
IF YOU DO MAKE THE GOODS AVAILABLE TO THE SELLER AND THE SELLER DOES NOT
PICK THEM UP WITHIN 20 DAYS OF THE DATE OF YOUR NOTICE OF CANCELLATION, YOU MAY
RETAIN OR DISPOSE OF THE GOODS WITHOUT ANY FURTHER OBLIGATION. IF YOU FAIL TO
MAKE THE GOODS AVAILABLE TO THE SELLER, OR IF YOU AGREE TO RETURN THE GOODS TO THE SELLER AND FAIL TO DO SO, THEN YOU REMAIN LIABLE FOR PERFORMANCE OF ALL
OBLIGATIONS UNDER THE CONTRACT.
TO CANCEL THIS TRANSACTION, MAIL OR DELIVER A SIGNED AND DATED COPY OF THIS
CANCELLATION NOTICE OR ANY OTHER WRITTEN NOTICE, OR SEND A TELEGRAM, TO [Name of seller], AT [address of seller's place of business] NOT LATER THAN MIDNIGHT OF----------(date).
I HEREBY CANCEL THIS TRANSACTION.
------------- (Buyer's signature)
(c) Fail, before furnishing copies of the "Notice of Cancellation"
to the buyer, to complete both copies by entering the name of the seller, the
address of the seller's place of business, the date of the transaction, and the
date, not earlier than the third business day following the date of the
transaction, by which the buyer may give notice of cancellation.
(d) Include in any door-to-door contract or receipt any confession of
judgment or any waiver of any of the rights to which the buyer is entitled under
this section including specifically his right to cancel the sale in accordance
with the provisions of this section.
(e) Fail to inform each buyer orally, at the time he signs the contract or
purchases the goods or services, of his right to cancel.
(f) Misrepresent in any manner the buyer's right to cancel.
(g) Fail or refuse to honor any valid notice of cancellation by a buyer and
within 10 business days after the receipt of such notice, to: (I) Refund all
payments made under the contract or sale; (ii) return any goods or property
traded in, in substantially as good condition as when received by the seller;
(iii) cancel and return any negotiable instrument executed by the buyer in
connection with the contract or sale and take any action necessary or
appropriate to terminate promptly any security interest created in the
(h) Negotiate, transfer, sell, or assign any note or other evidence of
indebtedness to a finance company or other third party prior to midnight of the
fifth business day following the day the contract was signed or the goods or
services were purchased.
(I) Fail, within 10 business days of receipt of the buyer's notice of
cancellation, to notify him whether the seller intends to repossess or to
abandon any shipped or delivered goods.
Note 1: Definitions. For the purposes of this section the following
definitions shall apply:
(a) Door-to-Door Sale-- A sale, lease, or rental of consumer goods or
services with a purchase price of $25 or more, whether under single or multiple
contracts, in which the seller or his representative personally solicits the
sale, including those in response to or following an invitation by the buyer,
and the buyer's agreement or offer to purchase is made at a place other than the
place of business of the seller. The term "door-to-door sale" does
not include a transaction:
(1) Made pursuant to prior negotiations in the course of a visit by the
buyer to a retail business establishment having a fixed permanent location where
the goods are exhibited or the services are offered for sale on a continuing
(2) In which the consumer is accorded the right of recision by the
provisions of the Consumer Credit Protection Act (15 U.S.C. 1635) or regulations
issued pursuant thereto; or
(3) In which the buyer has initiated the contact and the goods or services
are needed to meet a bona fide immediate personal emergency of the buyer, and
the buyer furnishes the seller with a separate dated and signed personal
statement in the buyer's handwriting describing the situation requiring
immediate remedy and expressly acknowledging and waiving the right to cancel the
sale within 3 business days; or
(4) Conducted and consummated entirely by mail or telephone; and without
any other contact between the buyer and the seller or its representative prior
to delivery of the goods or performance of the services; or
(5) In which the buyer has initiated the contact and specifically requested
the seller to visit his home for the purpose of repairing or performing
maintenance upon the buyer's personal property. If in the course of such a
visit, the seller sells the buyer the right to receive additional services or
goods other than replacement parts necessarily used in performing the
maintenance or in making the repairs, the sale of those additional goods or
services would not fall within this exclusion; or
(6) Pertaining to the sale or rental of real property, to the sale of
insurance or to the sale of securities or commodities by a broker-dealer
registered with the Securities and Exchange Commission.
(b) Consumer Goods or Services-- Goods or services purchased, leased, or
rented primarily for personal, family, or household purposes, including courses
of instruction or training regardless of the purpose for which they are taken.
(c) Seller-- Any person, partnership, corporation, or association engaged in
the door-to-door sale of consumer goods or services.
(d) Place of Business-- The main or permanent branch office or local address
of a seller.
(e) Purchase Price-- The total price paid or to be paid for the consumer
goods or services, including all interest and service charges.
(f) Business Day-- Any calendar day except Sunday, or the following business
New Year's Day, Washington's Birthday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veterans' Day, Thanksgiving Day, and Christmas Day.
Note 2: Effect on State Laws and Municipal Ordinances.
(a) The Commission is cognizant of the significant burden imposed upon door-
to-door sellers by the various and often inconsistent State laws which provide
the buyer with the right to cancel door-to-door sales transactions. However, it
does not believe that this constitutes sufficient justification for preempting
all of the provisions of such laws or of the ordinances of the political
subdivisions of the various States. The Record in the proceedings supports the
view that the joint and coordinated efforts of both the Commission and State and
local officials are required to insure that a consumer who has purchased from a
door-to-door seller something he does not want, does not need, or cannot afford,
is accorded a unilateral right to rescind, without penalty, his agreement to
purchase the goods or services.
(b) This section will not be construed to annual, or exempt any seller from
complying with the laws of any State, or with the ordinances of political
subdivisions thereof, regulating door-to-door sales, except to the extent that
such laws or ordinances, if they permit door-to-door selling, are directly
inconsistent with the provisions of this section. Such laws or ordinances which
do not accord the buyer, with respect to the particular transaction, a right to
cancel a door-to-door sale which is substantially the same or greater than that
provided in this section, or which permit the imposition of any fee or penalty
on the buyer for the exercise of such right, or which do not provide for giving
the buyer notice of his right to cancel the transaction in substantially the
same form and manner provided for in this section, are among those which will be
considered directly inconsistent.