Claiming Made in USA? Be Prepared to Prove It.

Claiming Made in USA? Be Prepared to Prove It.

The U.S. Federal Trade Commission (FTC) is cracking down on companies that claim products are “Made in USA” without meeting the appropriate requirements.

The Made in USA labeling standard has existed for decades, but enforcement has increased recently, after a July 2018 ruling by the FTC reiterating that products with Made in USA labeling must be “all or virtually all” made in the U.S. With the exception of automobile, textile and wool products, most goods made in the U.S.don’t require Made in USA labels; such markings are generally affixed for marketing purposes. However, once the claim has been made, products must comply with FTC standards.

Learn more about best practices for managing country of origin requirements in our guide, Managing Data for Trade Compliance.

Recent enforcement cases include:

Companies that use Made in USA labeling must be able to prove that the parts, processes and labor involved in manufacturing their products are almost entirely of U.S. origin.

Under the Lanham Act, enforcement action can be launched by the FTC, consumers or competitors when labeling is identified as false advertising, has deceived the intended audience or influenced consumer decisions. Enforcement action by the FTC can lead to public disclosure of settlements, which can affect brand reputation and have a significant financial impact.

Companies must conduct due diligence on suppliers and products to determine country of origin before marketing products as Made in USA. It is important to understand the source of all materials and subcomponents in products before these claims are made.

Companies can use Assent’s Trade Compliance and Origin Module to collect country of origin certificates, and Harmonized Item Description and Coding System (HS) codes at the part level. To learn more about how Assent can help you manage your trade compliance supply chain data, contact info@assentcompliance.com.

 

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