FTC: Made In The USA Comments Concerning Tim Feldman--P894219
August 11, 1997
Office of the Secretary
RE:"Made in USA Policy Comments, FTC File No. P894219
Dear Secretary Clark:
On behalf of the member compares of the National Electrical Manufacturers Association (NEMA), I have the following comments with regard to the Federal Trade Commission's notice in the Federal Register on May 7, 1997 (62 Fed. Reg. NO. 88 250191).
NEMA is the largest trade association in the United States representing the interests of electroindustry manufacturers. Founded in 1926 and headquartered in Rosslyn, Virginia, its 575 member companies manufacture products used in the generation, transmission and distribution, control, and end-use of electricity. Many of NEMA's member companies have major involvement and interests in international standards activities, conformity assessment and other trade-related issues affecting their international markets. NEMA member company sales total $100 Billion a year and annual exports total $13 Billion. 500,000 people are employed by NEMA representatives in the U.S.
Before commenting on the proposed guidelines we would like to refer back to our original comments filed in July, 1996. Most NEMA members manufacture and distribute industrial products. Industrial products are sold in a very different markets, both domestically and internationally, from consumer products. To reiterate our earlier comments, we believe the Commission's guidelines should apply to consumer goods alone. The primary interest and concern of the Commission is protection of the consumer and by definition, the consumer never sees an industrial product. Recognizing this difference between consumer and industrial products, the Commission should allow industrial product manufacturers to manufacture for the global market with markings of "Made in the USA" without violating the Commission's guidelines.
As outlined in our July, 1996 comments, we restate our recommendation that the FTC consider substantial transformation as the proper calculation for industrial products in order to use a "Made in America label. This would, in effect, exempt industrial products from a consumer product standard and would allow industrial product manufacturers to continue selling products globally without facing needless costs and administrative complications associated with meeting various standards. Further, we would recommend the Commission accept the current U.S. Customs definition of substantial transformation for non-NAFTA countries. Once, however, the World Trade Organization's Committee on Customs finishes its work on the development of a universal calculation for substantial transformation, we would urge the Commission to accept that definition with the rest of the U.S. Federal government.
"Origin USA" Label
Notwithstanding our above comments, NEMA appreciates the Commission's efforts to address the issue of conflicting labeling standards in the domestic market and foreign markets. A "lesser mark available for country of origin marking could be of certain utility to US industrial manufacturers who may export U.S. products to foreign markets as mentioned earlier, US manufacturers are subject to conflicting and contradictory requirements for labeling country of origin on U.S. products. The ability to mark labels on US products with the recommended "Origin USA" label could help to alleviate this problem by making unnecessary the need for US manufacturers to mark products for export with a Made in USA" label and then change the dye lot on products for domestic sale to eliminate the "Made in USA" label. Furthermore, manufacturers would not be forced to maintain packaging plants in foreign countries for the sole purpose of meeting conflicting labeling standards.
The "Origin USA" proposal is worthy of further consideration An evaluation needs to consider global acceptance of the use of "Origin USA". NEMA has conducted an informal inquiry into the acceptance of "Origin USA" in foreign countries. While a number of countries have indicated informally that "Origin USA'would be an acceptable alternative to "Made in USA", a number have also indicated that either they would not accept "Origin USA" or they are not sure they would accept "Origin USA".
We would also like to address the requirement that manufacturers must demonstrate a "de minimus" amount of exporting before using the "Origin USAmark. Many of our companies start out selling the product to the domestic market with plans to export in the future. To re- work the packaging to add Origin USA' when the product finally begins to sell in foreign markets makes no sense for industrial products and represents a significant cost to the manufacturer. NEMA recommends that the Commission allow for either current exporting or plans for future exporting as justification for the use of "Origin USA on industrial products.
Any implementation of "Origin USA" should be without cost to the manufacturer. Therefore, "Origin USA" should be for new products only and not involve any re-labeling. Additionally, any trial period - such as the proposed 5-year evaluation period, should not be applicable to industrial products.
The proposed Commission guidelines have recognized the distinction between consumer and industrial products as outlined in XIII, C., disclosure of substantial foreign content in consumer products. This distinction should be maintained throughout the proposal. Therefore, industrial products should not be subject to the same criteria or scrutiny as consumer products when it involves origin labeling.
NEMA appreciates the opportunity to submit these comments and commends the Commission for the time and effort it has made in trying to meet the various and often conflicting interests of the parties involved.