Made in USA
From Wikipedia, the free encyclopedia
The Made in USA mark is a country of origin label indicating the product is "all or virtually all" made in the U.S. The label is regulated by the Federal Trade Commission (FTC).
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[edit] Legal requirements
U.S. content must be disclosed on automobiles and textile, wool, and fur products. No law requires most other products sold in the U.S. to be marked or labeled Made in USA or have any other disclosure about their amount of U.S. content. However, manufacturers and marketers who choose to make claims about the amount of U.S. content in their products must comply with the FTC’s Made in USA policy.
A Made in USA claim can be express (for example, "American-made") or implied. In identifying implied claims, the Commission focuses on the overall impression of the advertising, label, or promotional material. Depending on the context, U.S. symbols or geographic references (for example, U.S. flags, outlines of U.S. maps, or references to U.S. locations of headquarters or factories) may convey a claim of U.S. origin either by themselves, or in conjunction with other phrases or images.
In 1996 the FTC[1] proposed that the requirement be stated as:
- It will not be considered a deceptive practice for a marketer to make an unqualified U.S. origin claim if, at the time it makes the claim, the marketer possesses and relies upon competent and reliable evidence that: (1) U.S. manufacturing costs constitute 75% of the total manufacturing costs for the product; and (2) the product was last substantially transformed in the United States.
However, this was just a proposal and never became part of the final guidelines which were published in the Federal Register[2] in 1997.
[edit] Assembled in USA
A product that includes foreign components may be called "Assembled in USA" without qualification when its principal assembly takes place in the U.S. and the assembly is substantial. For the "assembly" claim to be valid, the product’s "last substantial transformation" also should have occurred in the U.S. That’s why a "screwdriver" assembly in the U.S. of foreign components into a final product at the end of the manufacturing process doesn’t usually qualify for the "Assembled in USA" claim.
[edit] Relevant legislation
The Textile Fiber Products Identification Act and Wool Products Labeling Act require a Made in USA label on most clothing and other textile or wool household products if the final product is manufactured in the U.S. of fabric that is manufactured in the U.S., regardless of where materials earlier in the manufacturing process (for example, the yarn and fiber) came from. Textile products that are imported must be labeled as required by the Customs Service. A textile or wool product partially manufactured in the U.S. and partially manufactured in another country must be labeled to show both foreign and domestic processing.
On a garment with a neck, the country of origin must be disclosed on the front of a label attached to the inside center of the neck — either midway between the shoulder seams or very near another label attached to the inside center of the neck. On a garment without a neck, and on other kinds of textile products, the country of origin must appear on a conspicuous and readily accessible label on the inside or outside of the product.
Catalogs and other mail order promotional materials for textile and wool products, including those disseminated on the Internet, must disclose whether a product is made in the U.S., imported or both.
The Fur Products Labeling Act requires the country of origin of imported furs to be disclosed on all labels and in all advertising.
The American Automobile Labeling Act requires that each automobile manufactured on or after October 1, 1994, for sale in the U.S. bear a label disclosing where the car was assembled, the percentage of equipment that originated in the U.S. and Canada, and the country of origin of the engine and transmission. Any representation that a car marketer makes that is required by the AALA is exempt from the Commission’s policy. When a company makes claims in advertising or promotional materials that go beyond the AALA requirements, it will be held to the Commission’s standard.
The Buy American Act requires that a product be manufactured in the U.S. of more than 50 percent U.S. parts to be considered Made in USA for government procurement purposes. For more information, review the Buy American Act at 41 U.S.C. §§ 10a-10c, the Federal Acquisition Regulations at 48 C.F.R. Part 25, and the Trade Agreements Act at 19 U.S.C. §§ 2501-2582.
The Lanham Act gives any person (such as a competitor) who is damaged by a false designation of origin the right to sue the party making the false claim.
[edit] Customs fraud
Examples of fraudulent practices involving imports include removing a required foreign origin label before the product is even delivered to the ultimate purchaser (with or without the improper substitution of a Made in USA label) and failing to label a product with the required country of origin.
There have been claims that products made in Usa located in Ōita Prefecture, Japan and exported to the US in the 1960s carried the label "MADE IN USA, JAPAN", in order for it to have an appearance that the product is "Made in USA". It is, however a myth that Japan renamed the town "Usa" following World War II so that goods exported from Japan could be labeled as such. [3] The town had this name long before the war, at least from 8th century, and is not where the majority of Japanese industry is located.
[edit] Marketing significance
Many manufacturers use the Made in the U.S.A. label as a selling point with varying degrees of success. This is largely because, in the wake of lowering or eliminating import tariffs, the proportionate quantity of manufactured goods made within the United States has steadily declined, especially within the last three to four decades. American companies have largely focused their unskilled manufacturing operations in poorer nations, largely China, where labor is cheaper and labor and environmental laws are comparatively insignificant. Many Americans view this trend with disdain for a variety of reasons. Some worry that their nation has lost both industrial capacity and essential manufacturing jobs, some may be concerned with the exploitation of non-American workers in sweatshops, while others believe that this has drastically decreased the general availability of high quality products. Therefore a product bearing a Made in the U.S.A. label can appeal to an American who seeks high quality products produced domestically under American labor and environmental laws.
The situation for US manufacturers who export, particularly high-tech manufacturers, is a bit more complex. Some countries, such as Japan, require country-of-origin statements when goods are imported, but US companies are prohibited from making an unqualified "Made in USA" claim unless "all or substantially all" of their product is of US origin. High tech manufacturers often cannot procure all of the needed components of their product from US sources; typically a few percent of the manufacturing cost represents components sourced from overseas, yet there is no definition of "substantially all" since the 75% guideline referred to above was withdrawn by FTC.
[edit] Examples
The FTC has a page[4] summarizing this issue, but as of early 2008 there doesn't appear to be a "bright line" determining what "all or substantially all" means.
