What are the requirements for labeling a product Made in the USA?
Under its general authority to act against deceptive acts and practices, the Federal Trade Commission (FTC) controls ‘Made in America’, ‘Made in the USA’, or any claims of U.S. origin for all products sold or advertised in the United States.
The FTC Act, § 45a Labels on products, states that a product advertised or offered for sale with a ‘Made in USA’, “Made in America’, or equivalent label must have domestic origins that are consistent with orders and decision of the FTC. FTC has provided a policy statement requiring that ‘all or virtually all’ of a product be made in the United States to make the unqualified claim. Any product labeled with an unqualified ‘Made in the USA’ claim or similar must be able to have that claim substantiated.
U.S. Customs Service country of origin labeling for imports; National Highway Traffic Safety Administration country of origin requirements for automobiles; and FTC country of origin labeling for textiles, wool, and fur products are not addressed here.
Do all products that are made in the USA have to be labeled?
If the U.S. Custom Service determines that a good is not of foreign origin (i.e., the good undergoes its last substantial transformation in the United States) there is no requirement for labeling with the country of origin. The FTC does not require country of origin for U.S. manufactured goods with the exception of automobile, textile, or wool products.
What products does this apply to?
This applies to all products advertised or sold in the United States, except those that are covered by other laws. If the product is being exported, you must consult the country of origin laws or rules of the country the product is being imported for compliance.
What does ‘all or virtually all’ mean?
A product that is ‘all or virtually all’ made in the United States will be one in which all significant parts and processing that go into the product are of U.S. origin and the product contains negligible foreign content.
The commission looks at a number of factors when making a determination if this requirement has been met, including that final assembly or processing of the product takes place in the United States, the portion of the product's total manufacturing costs that are attributable to U.S. parts and processing; and how far removed from the finished product any foreign content is. Foreign content incorporated early in the manufacturing process will often be less significant than content that is a direct part of the finished product.
A gas grill has knobs that are imported, but the rest of the grill components are of U.S. origin. An unqualified ‘Made in USA’ claim is not likely to be deceptive because the knobs make up a negligible portion of the product’s total manufacturing costs and are insignificant parts of the final product.
A tool, such as a wrench, is made from imported steel. It cannot bear a ‘Made in the USA’ claim because the steel is not far enough removed in the manufacturing process from the finished product to be of little consequence and it is a significant part of the final product.
Plastic made from imported petroleum is use to make the plastic housing of a clock radio that is otherwise made in the U.S. of U.S.-made components. A ‘Made in USA’ claim is likely to be appropriate because the petroleum is far enough removed from the finished product and is an insignificant part of it.
A cloth diaper cleaning device has a component, the clip used to fasten diapers to the device, that is imported. The FTC determined that although the cost of the imported content may be small relative to overall manufacturing costs, the clip is essential to the function of the product. Therefore, an unqualified ‘Made in USA’ claim might deceive consumers. The company relabeled its product ‘Made in USA from US and Imported Parts’.
How do I substantiate my claim?
A manufacturer or marketer must have a competent and reliable evidence to support the claim that ‘all or virtually all’ of the product is made in the USA When making this determination, it should use the cost of goods sold or inventory costs of finished goods in its analysis. These costs are limited to the total cost of manufacturing materials, direct manufacturing labor and manufacturing overhead. Information provided by American suppliers about domestic content can be relied on if given in good faith; however, manufacturers should ask suppliers for specific information about U.S. content. Again, manufacturers should look back far enough in the process to be reasonably sure that there is no significant foreign content.
If my packaging artwork includes an American flag, is this acceptable?
The FTC not only looks at express claims but also implied claims, such as by depicting an American Flag, map, other U.S. symbol or U.S. geographic reference, as well as over emphasis of a U.S. address or headquarters of the manufacturer. Whether or not the use of one of these symbols or phrases implies a U.S. country of origin claim depends on the circumstances in which it is used. For example, a legal trademark consisting of, or incorporating, a stylized mark suggestive of a U.S. flag will not, by itself, be considered to constitute a U.S. origin claim.
The commission will not consider a marketer’s use of a brand name or trademark without more as a claim to country of origin, even if a consumer mistakenly believes that a product made by a U.S.-based manufacturer is made in the U.S.
If I am manufacturing my product in the U.S. of foreign parts, can I label ‘Manufactured in the U.S.’?
To avoid deception, any product that is not all or virtually all made in the United States, must have U.S. origin claims adequately qualified. A marketer may make any qualified claim about the U.S. content of its products as long as the claim is truthful and substantiated.
However, general terms such as ‘produced’ or ‘manufactured’ in the United States require further qualification as to not be considered deceptive (e.g., manufactured in the USA with imported parts). The Commission has determined that ‘Assembled in the United States’ without further qualification is acceptable, but because assembly describes a wide range of processes and may be confusing or misleading to consumers, its use should be limited to those instances where the product has undergone its principal assembly in the United States and that assembly is substantial, and the product was last substantially transformed in the United States.
It is acceptable to make claims about specific processes or parts as long as the claim is truthful, substantiated, and reasonable consumers would understand the claim to refer to a specific process or part and not to the general manufacture of the product.
If the U.S. Custom Service determines my product does not need a foreign country of origin mark, can I label it Made in the USA?
Not necessarily. The product cannot be advertised or labeled as ‘Made in USA’ in less it meets the FTC requirements.
For more information, see FTC’s:
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