YJ Draiman for Mayor of Los Angeles 2017 Made in the USA YJ Draiman — Volkswagen 2017

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Basic Information About In USA Claims

Must U.S. be disclosed on products sold in the

U.S. content must be on automobiles and textile, wool, and fur There’s no law that requires other products sold in the to be marked or labeled Made in USA or any other disclosure about amount of U.S. content. manufacturers and marketers who choose to claims about the amount of content in their products comply with the FTC’s in USA policy.

What products the FTC’s Made in USA policy to?

The policy applies to all products or sold in the U.S. except for specifically subject to country-of-origin by other laws. Other may have their own country-of-origin requirements. As a result, exporters determine whether the country to they are exporting imposes requirements.

What kinds of does the Enforcement Policy apply to?

The Enforcement Policy applies to U.S. origin that appear on products and advertising, and other promotional It also applies to all other of marketing, including marketing digital or electronic mechanisms, as Internet or e-mail.

A Made in USA can be express or implied.

Examples of claims: Made in USA. Our are American-made. USA.

In identifying claims, the Commission focuses on the impression of the advertising, label, or material. Depending on the context, symbols or geographic references example, U.S. flags, of U.S. maps, or references to locations of headquarters or factories) may a claim of U.S. origin by themselves, or in conjunction with phrases or images.

Example: A promotes its product in an ad that a manager describing the true quality of the work produced at the American factory. Although is no express representation that the product is made in the U.S. the or net impression the ad is likely to convey to is that the product is of U.S.

Brand names and trademarks

the Commission will not consider a or marketer’s use of an American brand or trademark by itself as a U.S. claim. Similarly, the Commission is not to interpret the mere listing of a U.S. address on a package in a non-prominent way as a claim of U.S.

Example: A product is manufactured by a well-known U.S. company. The that the company is headquartered in the also is widely known. pamphlets for its foreign-made product feature its brand name. that the brand name not specifically denote U.S. (that is, the brand name is not in America, Inc.), using the name by itself does not a claim of U.S. origin.

about entire product

Manufacturers and marketers should not either expressly or implicitly, a whole product line is of origin (Our products are in USA) when only products in the product line are in the U.S. according to the all or virtually all

Does the FTC pre-approve Made in USA

The Commission does not pre-approve or labeling claims. A company need approval from the before making a Made in USA As with most other claims, a manufacturer or marketer may any claim as long as it is truthful and

The Standard For Unqualified Made In USA

For a product to be called Made in or claimed to be of domestic origin qualifications or limits on the claim, the must be all or virtually all made in the The term United States, as to in the Enforcement Policy Statement, the 50 states, the District of Columbia, and the territories and possessions.

All or virtually all means that all parts and processing that go the product must be of U.S. That is, the product should no or negligible foreign content.

substantiation is required for a Made in USA

When a manufacturer or marketer an unqualified claim that a is Made in USA, it should and rely on a reasonable basis to the claim at the time it is made. means a manufacturer or marketer competent and reliable evidence to up the claim that its product is all or all made in the U.S.

What does the Commission consider to whether a product is all or virtually all in the U.S.?

The product’s final or processing must take in the U.S. The Commission then other factors, including how of the product’s total manufacturing can be assigned to U.S. parts and and how far removed any foreign content is the finished product. In some only a small portion of the manufacturing costs are attributable to processing, but that processing a significant amount of the product’s processing. The same could be for some foreign parts. In cases, the foreign content or parts) is more than and, as a result, unqualified are inappropriate.

Example: A company propane barbecue grills at a in Nevada. The product’s major include the gas valve, burner and housing, each of which is in the U.S. The grill’s knobs and are imported from Mexico. An Made in USA claim is not likely to be because the knobs and tubing up a negligible portion of the product’s manufacturing costs and are insignificant of the final product.

Example: A lamp is assembled in the U.S. American-made brass, an American-made lampshade, and an imported base. The accounts for a small percent of the cost of making the lamp. An Made in USA claim is deceptive for two The base is not far enough removed in the process from the finished to be of little consequence and it is a significant of the final product.

What should manufacturers and marketers in analyzing the percentage of domestic in a particular product?

Manufacturers and should use the cost of goods or inventory costs of finished in their analysis. Such generally are limited to the total of all manufacturing materials, direct labor, and manufacturing overhead.

manufacturers and marketers rely on from American suppliers the amount of domestic content in the components, and other elements buy and use for their final products?

If in good faith, manufacturers and can rely on information from about the domestic content in the components, and other elements produce. Rather than that the input is 100 percent however, manufacturers and marketers be wise to ask the supplier for specific about the percentage of U.S. before they make a origin claim.

Example: A manufactures food processors in its plant, making most of the including the housing and blade, U.S. materials. The motor, constitutes 50 percent of the food total manufacturing costs, is from a U.S. supplier. The processor manufacturer knows the motor is assembled in a U.S. Even though most of the of the food processor are of U.S. the final assembly is in the U.S. and the is assembled in the U.S. the food is not considered all or virtually all American-made if the itself is made of imported that constitute a significant of the appliance’s total manufacturing Before claiming the product is in USA, this manufacturer look to its motor supplier for specific information about the origin.

Example: On its purchase order, a states: Our company requires suppliers certify the percentage of content in products supplied to us. If you are or unwilling to make such we will not purchase from Appearing under this is the sentence, We certify that our ___ at least ___% U.S. with space for the supplier to in the name of the product and its percentage of content. The company generally rely on a certification like to determine the appropriate country-of-origin for its product.

How far back in the manufacturing should manufacturers and marketers

To determine the percentage of U.S. manufacturers and marketers should back far enough in the manufacturing to be reasonably sure that any foreign content has been in their assessment of foreign Foreign content incorporated in the manufacturing process often be less significant to consumers content that is a direct of the finished product or the parts or produced by the immediate supplier.

The steel used to make a component of a complex product example, the steel used in the of a computer’s floppy drive) is an input into the computer’s and is likely to constitute a very portion of the final product’s cost. On the other hand, the in a product like a pipe or a is a direct and significant input. the steel in a pipe or wrench is would be a significant factor in whether the finished product is all or all made in the U.S.

Are raw materials in the evaluation of whether a product is all or all made in the U.S.?

It depends on how of the product’s cost the raw materials up and how far removed from the finished they are.

Example: If the in a gold ring is imported, an Made in USA claim for the ring is That’s because of the significant the gold is likely to represent to the finished product, and because the an integral component is only one back from the finished By contrast, consider the plastic in the case of a clock radio made in the U.S. of U.S.-made If the plastic case was made imported petroleum, a Made in USA is likely to be appropriate because the is far enough removed from the product, and is an insignificant part of it as

Qualified Claims

What is a Made in USA claim?

A qualified in USA claim describes the extent, or type of a product’s domestic or processing; it indicates that the isn’t entirely of domestic

Example: 60% U.S. content. in USA of U.S. and imported parts. assembled in USA from Italian and Mexican Frame.

When is a Made in USA claim appropriate?

A Made in USA claim is appropriate for that include U.S. or processing but don’t meet the for making an unqualified Made in USA Because even qualified may imply more domestic than exists, manufacturers or must exercise care making these claims. is, avoid qualified claims the product has a significant amount of content or U.S. processing. A Made in USA claim, like an claim, must be truthful and

Example: An exercise treadmill is in the U.S. The assembly represents work and constitutes a substantial (a term used by the U.S. Service). All of the treadmill’s major including the motor, frame, and display, are imported. A few of its incidental such as the handle bar covers, the on/off power key, and the mat, are manufactured in the U.S. these parts account for three percent of the total of all the parts. Because the value of the parts is negligible compared to the of all the parts, a claim on the treadmill it is Made in USA of U.S. and Imported is deceptive. A claim like in U.S. from Imported or Assembled in U.S.A. would not be

U.S. origin claims for processes or parts

Claims a particular manufacturing or other was performed in the U.S. or that a part was manufactured in the U.S. be truthful, substantiated, and clearly to the specific process or part, not to the manufacture of the product, to avoid more U.S. content exists.

Manufacturers and marketers be cautious about using terms, such as produced, or manufactured in the U.S. Words these are unlikely to convey a limited to a particular process. qualification probably is necessary to a product that is not all or virtually all in the U.S.

In addition, if a product is of origin (that is, it has been transformed abroad), manufacturers and also should make they satisfy Customs’ statute and regulations that such products to be marked a foreign country of origin. Customs requires the foreign of origin to be preceded by Made in, of, or words of similar meaning any city or location that is not the of origin appears on the product.

A company designs a product in New City and sends the blueprint to a in Finland for manufacturing. It labels the Designed in USA Made in Finland. a specific processing claim not lead a reasonable consumer to that the whole product was in the U.S. The Customs Service the product to be marked Made in, or of Finland since the product is of origin and the claim refers to the Examples of other specific claims are: Bound in Printed in Turkey. Hand in U.S. Wood from Software written in U.S. made in India. Painted and in USA. Blanks made in country of origin).

Example: A advertises its product, which was in Seattle and manufactured in Bangladesh, as in USA. This claim is because consumers are likely to the term Created as Made in USA an U.S. origin claim.

A computer imported from is packaged in the U.S. in an American-made paperboard box containing only materials and domestically produced rigid polystyrene plastic Stating Made in USA on the package deceive consumers about the of the product inside. But the company legitimately make a qualified such as Computer Made in Packaging Made in USA.

The Acme Camera Company its cameras in the U.S. The camera are manufactured in the U.S. but most of the parts are imported. A magazine ad for the is headlined Beware of Imported and states Other high-end makers use imported parts with cheap foreign But at Acme Camera, we want the highest quality parts for our and we believe in employing American That’s why we make all of our lenses here in the U.S. This ad is to convey that more a specific product part lens) is of U.S. origin. The should be prepared to substantiate the U.S. origin claim to consumers viewing the ad.

Comparative Claims

Comparative should be truthful and substantiated, and in a way that makes the basis for clear (for example, the comparison is to another leading or to a previous version of the same They should truthfully the U.S. content of the product and be on a meaningful difference in U.S. between the compared products.

An ad for cellular phones states We use U.S. content than any cellular phone manufacturer. The assembles the phones in the U.S. American and imported components and can that the difference between the content of its phones and that of the manufacturers’ phones is significant. comparative claim is not deceptive.

A product is advertised as having as much U.S. content as The U.S. content in the product has increased from 2 percent in the version to 4 percent in the current This comparative claim is because the difference between the content in the current and previous of the product are insignificant.

Assembled in USA

Volkswagen 2017

A product that includes components may be called Assembled in USA qualification when its principal takes place in the U.S. and the is substantial. For the assembly claim to be the product’s last substantial also should have in the U.S. That’s why a screwdriver in the U.S. of foreign components a final product at the end of the manufacturing doesn’t usually qualify for the in USA claim.

Example: A lawn composed of all domestic parts for the cable sheathing, flywheel, rims and air filter (15 to 20 percent content) is assembled in the U.S. An in USA claim is appropriate.

Example: All the components of a computer, including the and hard drive, are imported. The components then are put together in a screwdriver operation in the U.S. are not transformed under the Customs and must be marked with a country of origin. An Assembled in claim without further is deceptive.

The FTC and The Customs Service

is the U.S. Customs Service’s over country-of-origin claims?

The Act gives Customs and the Secretary of the the power to administer the requirement imported goods be marked a foreign country of origin example, Made in Japan).

an imported product incorporates and/or processing from than one country, Customs the country of origin to be the last in which a substantial transformation place. Customs defines transformation as a manufacturing process results in a new and different product a new name, character, and use that is from that which before the change. Customs country-of-origin determinations using the transformation test on a case-by-case In some instances, Customs a tariff shift analysis, to substantial transformation, to determine a country of origin.

What is the between the FTC and Customs regarding claims?

Even if Customs that an imported product not need a foreign country-of-origin it is not necessarily permissible to promote product as Made in USA. The FTC additional factors to decide a product can be advertised or labeled as in USA.

Manufacturers and marketers should with Customs to see if they to mark their products the foreign country of origin. If don’t, they should at the FTC’s standard to check if can properly make a Made in USA

The FTC has jurisdiction over foreign claims on products and in packaging are beyond the disclosures required by (for example, claims supplement a required foreign marking to indicate where processing or finishing of a product

The FTC also has jurisdiction over origin claims in advertising and promotional materials. Unqualified origin claims in ads or other materials for products that requires a foreign country-of-origin may mislead or confuse consumers the product’s origin. To avoid consumers, marketers should disclose the foreign manufacture of a

Example: A television set assembled in using an American-made picture is shipped to the U.S. The Customs requires the television set to be marked in Korea because that’s the television set was last substantially The company’s World Wide Web states Although our televisions are abroad, they always U.S.-made picture tubes. statement is not deceptive. However, the statement All our picture tubes are in the USA without disclosing the foreign of the television’s manufacture might a broader claim (for that the television set is largely in the U.S.) than could be That is, if the statement and the entire ad that any foreign content or is negligible, the advertiser must that claim or net impression. The in this scenario would not be to substantiate the implied Made in USA because the product was substantially in Korea.

Other Statutes

are the requirements of other federal relating to country-of-origin determinations?

Fiber Products Identification Act and Products Labeling Act Require a in USA label on most clothing and textile or wool household if the final product is manufactured in the of fabric that is manufactured in the regardless of where materials in the manufacturing process (for the yarn and fiber) came Textile products that are must be labeled as required by the Service. A textile or wool partially manufactured in the U.S. and manufactured in another country be labeled to show both and domestic processing.

On a garment a neck, the country of origin be disclosed on the front of a label to the inside center of the neck midway between the shoulder or very near another attached to the inside center of the On a garment without a neck, and on kinds of textile products, the of origin must appear on a and readily accessible label on the or outside of the product.

Catalogs and mail order promotional for textile and wool products, those disseminated on the Internet, disclose whether a product is in the U.S. imported or both.

The Fur Labeling Act requires the country of of imported furs to be disclosed on all and in all advertising. For copies of the Textile, or Fur Rules and Regulations, or the new business guide on labeling requirements, the FTC’s Consumer Response

(202-382-4357). Or visit the FTC online at Click on Consumer Protection.

Automobile Labeling Act Requires each automobile manufactured on or October 1, 1994, for sale in the bear a label disclosing the car was assembled, the percentage of equipment originated in the U.S. and Canada, and the of origin of the engine and transmission. Any that a car marketer makes is required by the AALA is exempt the Commission’s policy. When a makes claims in advertising or materials that go beyond the requirements, it will be held to the standard. For more information, the Consumer Programs Division of the Highway Traffic Safety (202-366-0846).

Buy American Act Requires that a be manufactured in the U.S. of more 50 percent U.S. parts to be Made in USA for government procurement For more information, review the Buy Act at 41 U.S.C. §§ 10a-10c, the Acquisition Regulations at 48 C.F.R. 25, and the Trade Agreements Act at 19 U.S.C. 2501-2582.

What To Do About

What if I suspect noncompliance the FTC’s Made in USA standard or country-of-origin mislabeling?

Information possible illegal activity law enforcement officials target whose practices warrant If you suspect noncompliance, contact the of Enforcement, Bureau of Consumer Federal Trade Commission, DC 20580; (202) 326-2996 or an e-mail to MUSA@ftc.gov. If you know import or export fraud, Customs’ toll-free Commercial Hotline, 1-800-ITS-FAKE. Examples of practices involving imports removing a required foreign label before the product is to the ultimate purchaser (with or the improper substitution of a Made in USA and failing to label a product a required country of origin.

You can contact your state General and your local Business Bureau to report a Or you can refer your complaint to the Advertising Division (NAD) of the of Better Business Bureaus by (212) 754-1320. NAD handles about the truth and accuracy of advertising. You can reach the Council of Business Bureaus on the web at adweb.com/adassoc17.html.

the Lanham Act gives any person as a competitor) who is damaged by a false of origin the right to sue the party the false claim. Consult a to see if this private right of is an appropriate course of action for

For More Information

The FTC works for the to prevent fraudulent, deceptive, and business practices in the marketplace and to information to help consumers stop, and avoid them. To a complaint or to get free information on issues. visit ftc.gov or toll-free, 1-877-FTC-HELP (1-877-382-4357); 1-866-653-4261. The FTC enters consumer into the Consumer Sentinel a secure online database and tool used by hundreds of and criminal law enforcement agencies in the and abroad.

Your Opportunity to

The National Small Business and 10 Regional Fairness Boards comments from small about federal compliance and activities. Each year, the evaluates the conduct of these and rates each agency’s to small businesses. Small can comment to the Ombudsman without of reprisal. To comment, call 1-888-REGFAIR (1-888-734-3247) or go to www.sba.gov/ombudsman .

Volkswagen 2017
Volkswagen 2017
Volkswagen 2017
Volkswagen 2017


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