Avis 2006 Annual Report Download - page 20

Table of Contents
during the rental period if there has been no breach of the rental agreement. Approximately 4% of our revenue during 2006 was generated by
the sale of loss damage waivers. To date, 24 states have enacted legislation which requires disclosure to each customer at the time of rental that
damage to the rented vehicle may be covered by the customer’s personal automobile insurance and that loss damage waivers may not be
necessary. In addition, New York permits the sale of loss damage waivers at a capped rate per day based on the vehicle manufacturer’s
suggested retail price. Illinois, Nevada and California have similar statutes, which establish the daily rate that can be charged for loss damage
waivers.
Insurance
As a result of our reinsurance of the optional insurance coverages that we offer through unaffiliated third party insurance companies as well as
other insurance obligations, we are subject to regulation under the insurance statutes, including insurance holding company statutes, of the
jurisdictions in which our insurance company subsidiaries are domiciled. These regulations vary from jurisdiction to jurisdiction, but generally
require insurance holding companies and insurers that are subsidiaries of insurance holding companies to register and file certain reports,
including information concerning their capital structure, ownership, financial condition and general business operations with the regulatory
authority of the applicable jurisdiction, and require prior regulatory agency approval of changes in control of an insurer and intra-corporate
transfers of assets within the holding company structure. Such insurance statutes may also require that we obtain limited licenses to sell
optional insurance coverage to our customers at the time of rental.
Franchise regulation
The sale of franchises is regulated by various state laws, as well as by the Federal Trade Commission (the “FTC”). The FTC requires that
franchisors make extensive disclosure to prospective franchisees but does not require registration. A number of states require registration or
disclosure in connection with franchise offers and sales. In addition, several states have “franchise relationship laws” or “business opportunity
laws” that limit the ability of the franchisor to terminate franchise agreements or to withhold consent to the renewal or transfer of these
agreements. Although our franchising operations have not been materially adversely affected by such existing regulations, we cannot predict
the effect of any future federal, state or local legislation or regulation.
Privacy
Laws in some countries and jurisdictions limit the types of information we may collect about individuals with whom we deal or propose to
deal, as well as how we collect, retain and use the information that we are permitted to collect. The centralized nature of our information
systems requires the routine flow of information about customers and potential customers across national borders, particularly into the United
States. If this flow of information were to become illegal, or subject to onerous restrictions, our ability to serve our customers could be
seriously impaired for an extended period of time.
EMPLOYEES
As of December 31, 2006, we employed approximately 30,000 employees, of which approximately 11,000 people were employed on a part-
time basis. Approximately 27% of our employees are covered by collective bargaining agreements. We believe our employee relations are
satisfactory. We have never experienced a large-scale work stoppage.
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