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Made in USA

Made in USA

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Encyclopedia
The Made in USA mark is a country of origin
Country of origin
Country of origin , is the country of manufacture, production, or growth where an article or product comes from...

 label indicating the product is "all or virtually all" made in the U.S. The label is regulated by the Federal Trade Commission
Federal Trade Commission
The Federal Trade Commission is an independent agency of the United States government, established in 1914 by the Federal Trade Commission Act...

 (FTC).

Legal requirements


U.S. goods must be disclosed on automobile
Automobile
An automobile, autocar, motor car or car is a wheeled motor vehicle used for transporting passengers, which also carries its own engine or motor...

s and textile
Textile
A textile or cloth is a flexible woven material consisting of a network of natural or artificial fibres often referred to as thread or yarn. Yarn is produced by spinning raw fibres of wool, flax, cotton, or other material to produce long strands...

, wool
Wool
Wool is the textile fiber obtained from sheep and certain other animals, including cashmere from goats, mohair from goats, qiviut from muskoxen, vicuña, alpaca, camel from animals in the camel family, and angora from rabbits....

, and fur
Fur
Fur is a synonym for hair, used more in reference to non-human animals, usually mammals; particularly those with extensives body hair coverage. The term is sometimes used to refer to the body hair of an animal as a complete coat, also known as the "pelage". Fur is also used to refer to animal...

 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 and Persons 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 expressed (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 http://www.ftc.gov/opa/1997/05/examples.shtm 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 http://www.ftc.gov/opp/madeusa2/62fr63755.pdf in 1997.

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.

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
Buy American Act
The Buy American Act passed in 1933 by Congress and signed by President Hoover on his last full day in office , required the United States government to prefer U.S.-made products in itspurchases...

 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
Lanham Act
The Lanham Act is a piece of legislation that contains the federal statutes of trademark law in the United States. The Act prohibits a number of activities, including trademark infringement, trademark dilution, and false advertising.-History:Named for Representative Fritz G...

 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.

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
Usa, Oita
' is a city located in Ōita Prefecture, Japan. Usa is famous for being the location of the Usa Shrine, built in 725, the head shrine of all of Hachiman shrines in Japan.Usa is made up of three areas.*Usa, the area surrounding the Usa Shrine...

 located in Ōita Prefecture
Oita Prefecture
is a prefecture of Japan on Kyūshū Island. The prefectural capital is the city of Ōita.- History :Around the 6th century Kyushu consisted of four regions: Tsukushi-no-kuni 筑紫国, Hi-no-kuni 肥国, and Toyo no kuni...

, Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...

 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
Urban legend
An urban legend, urban myth, urban tale, or contemporary legend, is a form of modern folklore consisting of stories that may or may not have been believed by their tellers to be true...

 that Japan renamed the town "Usa" following World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...

 so that goods exported from Japan could be labeled as such. http://www.snopes.com/business/genius/usa.asp 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.

Marketing significance

"Made-in-the-USA has enormous appeal to the rising Chinese middle class."
Gary Locke
Gary Locke
Gary Locke may refer to:*Gary Locke , Chinese American politician; U.S. Secretary of Commerce and former Governor of Washington*Gary Locke *Gary Locke...


Many manufacturers use the Made in the U.S.A. label as a selling point with varying degrees of success. American companies have largely focused their manufacturing operations in poorer nations, largely China
China
Chinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...

, 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 sweatshop
Sweatshop
Sweatshop is a negatively connoted term for any working environment considered to be unacceptably difficult or dangerous. Sweatshop workers often work long hours for very low pay, regardless of laws mandating overtime pay or a minimum wage. Child labour laws may be violated. Sweatshops may have...

s, 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.

Examples


The FTC has a page summarizing this issue, but as of late 2011 there doesn't appear to be a "bright line" determining what "all or substantially all" means. Examples are given on the FTC site; a barbeque grill made of components made in USA with the exception of the knobs may be called "made in USA" while a garden tool with an imported motor may not.

Controversial use of label


Goods produced in American Samoa
American Samoa
American Samoa is an unincorporated territory of the United States located in the South Pacific Ocean, southeast of the sovereign state of Samoa...

 (a United States territory) are entitled to attach a "Made in USA" label, as this is an insular area
Insular area
An insular area is a United States territory, that is neither a part of one of the fifty U.S. states nor the District of Columbia, the federal district of the United States...

 of the United States. This area has until recently had few of the labor and safety protections afforded United States workers, and there have been a number of cases of sweatshop
Sweatshop
Sweatshop is a negatively connoted term for any working environment considered to be unacceptably difficult or dangerous. Sweatshop workers often work long hours for very low pay, regardless of laws mandating overtime pay or a minimum wage. Child labour laws may be violated. Sweatshops may have...

 operators exploiting labor forces imported from south and east Asia The Northern Mariana Islands
Northern Mariana Islands
The Northern Mariana Islands, officially the Commonwealth of the Northern Mariana Islands , is a commonwealth in political union with the United States, occupying a strategic region of the western Pacific Ocean. It consists of 15 islands about three-quarters of the way from Hawaii to the Philippines...

 is another U.S. possession in the Pacific that was exempted from U.S. wage and labor laws until recently, where the use of the "Made in USA" label was likewise controversial. The label is also controversial since all U.S. insular areas except Puerto Rico operate under a customs territory
Customs territory
A customs territory is a territory with individual customs regulations.The most common type of customs territory is the sovereign state and the others are the Trade bloc that has a customs union; and the autonomous or dependent territory that has independence in foreign trade and customs...

separate from the U.S., thereby making their products technically imports when sold in the United States proper.

External links