Federal Trade Commission
Received Documents
July 5, 1996
P894219
B18354900199

                       UNITED STATES SENATE
                    Washington, DC 20510-1901

                                        January 15, 1996

The Honorable Robert Pitofsky
Chairman
Federal Trade Commission
Washington, DC 20580

Dear Mr. Chairman:

     I am writing again to express my appreciation for the Federal Trade Commission's decision
to accept comments and hold workshops to consider revising its "Made in U.S.A." policy.  I want this
letter to serve as my comments to the FTC as requested in the Federal Register notice published on
October 18, 1995.

     1 do not support the FTC's current "Made in U.S.A." standard.  I believe that American
companies that produce goods with substantial domestic content should be allowed to make
American consumers aware of that fact and that unqualified ' ' 'Made in U.S.A." claims should not be
limited to companies whose goods are virtually 1 00 percent American-made.

     For a number of reasons, the FTC's policy on "Made in U.S.A." should be changed.  First, it
is outdated and unworkable.  The current "all or virtually all" standard does not reflect vast changes
in the global economy and fails to account for the fact that some components are simply not available
is this country.  Second, the standard unfair!,, denies the label to companies who strive to use as much
domestic labor and as many domestic components as possible, but are unable to reach the difficult
"all or virtually all" threshold.

     Finally, the FTC's current policy is inconsistent with other "Made in U.S.A." standards
maintained by other federal agencies.  For example, to obtain export promotion assistance, the
Department of Commerce requires that U.S. material and labor be at least 50 percent of the value of
the good.  To qualify for certain federal procurement under the Buy American Act, the cost of U.S.
components need only exceed 50 percent of the cost of all components.  For country of origin
purposes, the U.S. Customs Service does not consider an imported product to be foreign if it was
"substantially transformed" in the United States.  Additionally, under certain circumstances, products
are considered to be American goods under NAFTA if the U.S. content exceeds 50 percent of the
product's net cost.
The Honorable Robert Pitofsky
January 15, 1996
Page 2



     The FTC's current "Made in U.S.A." standard is outdated and should be changed.  I
appreciate your consideration of my views, and I would like to again thank the FTC for its decision
to review this standard.

                                        Sincerely,


                                        William S. Cohen
                                        United States Senator

WSC/eaa