Last summer, Truth in Advertising (“TINA.org”), a watchdog nonprofit that protects consumers against deceptive 
advertising, filed a complaint against Walmart. It alleged that over 100 products on its website had “Made in USA” labeling errors. The Federal Trade Commission (FTC) initiated an investigation and ultimately Walmart had to remove many of the “Made in USA” logos from its product listings and labels.
Many manufacturers and retailers are confused whether they can use “Made in USA” on their labels and how to do it. The above incident makes it clear that even the biggest brands can get it wrong.
According to the latest regulatory changes, marketers of products will have to meet all the standards, as mandated by the FTC (Federal Trade Commission). FTC is the body which works towards protecting consumers by preventing and eliminating fraud, deception and all forms of unfair business practices. Not complying with those standards can mean stiff penalties for violators.
Below is a checklist to verify whether your labeling claims meet FTC standards:
- “All or Virtually All”, refers to a product which has been manufactured using all significant parts that have U.S. origin.
- A reasonable basis to support the claim should be made while using the label.
- The percentage of domestic products as well as foreign products should be clearly specified.
- Terms, such as “produced”, “created”, “manufactured” etc. must be carefully used.
- References for concerned authorities must be clearly mentioned in the label.
As per the guidelines defined for USA Labeling Requirement by the FTC, a product can bear the label “Made in USA”, only if:
- It contains negligible or no foreign content
- The product’s last substantial transformation took place within the U.S.
- The product’s final assembly or processing was done within the U.S.
Owing to trade and manufacturing expanding globally, it has become highly essential for marketers and advertisers to carefully evaluate and assess the content and processing procedure for every product. This is a very important step to determine if the product qualifies to bear the “Made in USA” label or not. It is mandatory for them to back up their FTC standards claims with solid proofs which can justify their use of the label on their product.
The rules for determining the origin of a product can vary for a few states, though. California, for example, made a few changes in the regulations, which now allow California companies to use “Made in USA” label if their product is “90% American-made”. Earlier, the state did have stricter restrictions, which sought for “100% American-made” assurance but since 2015 this stance has changed, thereby complicating designated FTC standards claims for marketers.
To know more on the latest USA Labeling Requirement you can register for a live webinar at AudioSolutionz by Randi S. Waltuck Barnett, a highly regarded global trade professional. Randi will provide you with an effective overview of “Made in USA” labeling requirements as well as enforcement policies as defined by the Federal Trade Comission. She will discuss recent actions for evaluating effective techniques for responding to regulatory authority. She will also discuss the recent California policy changes in regards to USA labeling requirements and how those affect domestic and global traders.
