Wednesday, May 10, 2017

The Meaning of “Made in U.S.A.”

On May 5, 2017, the Congressional Research Service published The Meaning of "Made in U.S.A." (R44755)


The Federal Trade Commission (FTC), which has broad general authority to regulate deceptive practices, has asserted authority over claims that products are U.S.-made since 1987. The agency's guidelines assert that "The country in which a product is put together or completed is highly significant to consumers in evaluating where the product is 'made.'" In 2016, it deferred enforcement action against Bedrock Manufacturing Company, owner of the Shinola Brand, after the company agreed to take a number of corrective actions in response to allegations that it overstated the extent to which some of its products were made in the United States.

FTC policy states that a product claimed to be made in the United States must be "all or virtually all made in the United States," and should "ordinarily be one in which all significant parts and processing that go into the product are of U.S. origin," and should also be one that was "last 'substantially transformed'" in the United States. The commission may base its determination of whether a product is U.S.-made in part on the percentage of total manufacturing costs that are attributable to U.S. costs. The FTC does not consider the value of nonphysical inputs, such as services and software, in determining whether a product may legitimately be said to be U.S.-made.


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