FTC Seeks Public Comment Regarding "Made in USA" Advertising Claims...

Agency Prepares to Hold Public Workshop on Issue

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As the Federal Trade Commission prepares to conduct a public workshop on "Made in USA" advertising claims, the agency will publish in the Wednesday, Oct. 18 edition of the Federal Register a notice that seeks written comment on the issues to be discussed at that workshop. This past July, the FTC announced that it would hold a public workshop/conference -- tentatively scheduled for February or March 1996 in Washington, D.C. -- to determine (1) whether the FTC should alter its legal standard regarding the use of unqualified "Made in USA" claims, and (2) how domestic content claims should be measured under any future standard. The Commission will invite representatives from consumer groups, industry, government agencies, and other groups to attend. Written comments on these issues must be submitted by Jan. 16, 1996.

The Commission will consider the written comments of all persons and all comments received will be made part of the public record. However, any person who wishes to be considered for participation in the public workshop must file a written comment by Jan. 16, 1996. -- The FTC will publish a second Federal Register notice setting out the exact date and specific location of the workshop and the details on how to apply to participate in the workshop.

Among the questions the Commission specifically seeks comment on -- some of which are further detailed in the accompanying Federal Register notice -- are the following:

  • When consumers see product advertisements or labels stating or implying that products are "Made in USA," "Made in America," or the equivalent, what amount of U.S. parts and labor do they assume are in the products?
  • What are the costs and benefits of an "all or virtually all" threshold for "Made in USA" claims, versus a lower threshold (e.g., 50 %)?
  • What do consumers understand the phrase "Assembled in USA" to mean? Would consumers view such a term as suggesting the product has substantial foreign content? How much foreign content? What are the costs and benefits of allowing such a claim for a product where there is only minimal assembly?
  • How should the proportion of domestic content be measured with respect to "Made in USA" claims?
  • What form of guidance should the Commission offer with respect to "Made in USA" claims? Case-by-case enforcement? An enforcement policy statement? Guides or a rulemaking? Are there other forms of guidance that would be more useful or cost efficient?

The Commission requests that commenters, where possible, provide factual data in support of their comments. Comments proposing specific alternatives should indicate how the alternatives would better serve the Commission's statutory mandate of protecting consumers against deception.

At this time the Commission also is conducting a consumer research project regarding consumer perceptions of "Made in USA" claims, and the Commission's goal is to have the project completed in time for the public workshop.

Again, the Commission will only accept requests to participate in the workshop from parties who also have submitted written comments in response to this Federal Register notice. The agency requests that commenters submit six written copies of their comments. Comments must be submitted by Jan. 16, 1996 and should be addressed to:

Office of the Secretary Federal Trade Commission Room 159 6th Street and Pennsylvania Avenue, N.W. Washington, D.C. 20580

(Comments should, if possible, be submitted on a computer floppy disk -- MS dos compatible)

The Commission will consider the views and suggestions made during the workshop, in addition to any written comments, in formulating its future policy regarding "Made in USA" claims.

The Commission vote to issue the Federal Register notice seeking comment on the public workshop was 4-1, with Commissioner Roscoe B. Starek, III, dissenting. In his dissenting statement Commissioner Starek said, "I oppose spending Commission resources on a broad examination of whether and how to change the Commission's standard for unqualified "Made in USA" claims. . . . If consumer perceptions of "Made in USA" claims vary from industry to industry or support some other standard, the most promising way to develop that evidence is by litigating individual cases in which the particular ads at issue are copy tested. . . . I find no persuasive reason -- only, perhaps, some miscalculated conception of expediency -- for abandoning case-by-case enforcement in favor of a resource-intensive, unnecessarily broad review more typical of a rulemaking."

Copies of the Federal register notice and Commissioner Starek's dissenting statement are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 202-326-2502. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC's World Wide Web site at: http://www.ftc.gov

(FTC Matter No. P894219)

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