How Marketers Should Specify Which Products are Covered by Made in USA Claims

Marketers that utilize Made in USA claims on their websites, Amazon listings and other marketing materials should take care not to overstate the extent to which certain products are made in the United States.

In most instances, unqualified U.S.-origin claims in marketing materials – including claims products are “Made” or “Built” in the USA – likely suggest to consumers that the advertised products are “all or virtually all” made in the United States.

Depending upon the content, the Federal Trade Commission may analyze a number of different factors to determine whether a product is “all or virtually all” made in the United States, including the proportion of total manufacturing costs attributable to U.S. parts and processing, how far removed any foreign content is from the finished product, and the importance of the foreign content or processing to the product’s overall function.

The “all or virtually all” standard is codified in the Made in USA Labeling Rule, 16 C.F.R. § 323 (the “MUSA Labeling Rule”).  Effective August 13, 2021, it is a violation of the MUSA Labeling Rule to label any covered product “Made in the United States,” as the MUSA Labeling Rule defines that term, unless the final assembly or processing of the product occurs in the United States, all significant processing that goes into the product occurs in the United States, and all or virtually all ingredients or components of the product are made and sourced in the United States.  Pursuant to 15 U.S.C. § 45(m)(1)(A), the Commission may seek civil penalties of up to $53,088 per MUSA Labeling Rule violation.

Unless marketers either specify which products are covered or directly link claims to particular products, the FTC lawyers believe that consumers generally interpret U.S.-origin claims in marketing materials to cover all products advertised in those materials.

Marketers should not represent, either expressly or by implication, that a whole product line is of U.S. origin (e.g., ‘Our products are Made in USA’) when only some products in the product line are, in fact, made in the United States.”

Additionally, marketers should recall representations may be either express or implied, and ensure they can substantiate reasonable takeaways.  In identifying implied claims, the FTC focuses on the overall net impression of an advertisement, label, or other promotional material. This requires an examination of both the representation and the overall context, including the juxtaposition of phrases and images, and the nature of the transaction.

If, in context, an advertisement implies to a reasonable consumer that a product is of U.S. origin, a marketer must have appropriate substantiation for that claim.  If no such substantiation exists, a marketer should update or qualify the claim to avoid deception.

It may be appropriate for a marketer to promote its commitment to American jobs and highlight U.S. processes.  However, marketing materials should not state or imply products are wholly or partially made in the United States unless the marketer can substantiate those claims.

Contact an experienced Made in USA lawyer if your company is the subject of a regulatory investigation, or if you are interested in implementing a corrective action plan, including removing unqualified “Made in USA” claims from all product packaging and marketing materials.

A qualified FTC Made in USA attorney can work with companies to craft claims serving the dual purposes of conveying non-deceptive information and highlighting work done in the United States.