Under the Federal Trade Commission (FTC) regulations, making a “Made in USA” claim implies that a product is “all or virtually all” made in the United States. This standard is quite strict, and the FTC provides detailed guidelines to help businesses comply.

“All or Virtually All” Standard

• Significant U.S. Processing: The product should be “last substantially transformed” in the United States. This means that the final manufacturing or processing that makes the product what it is must happen in the U.S.
• U.S. Components and Materials: A significant majority, and preferably all, of the components, ingredients, or materials of the product must be made and sourced from the U.S. The FTC considers a product as “all or virtually all” made in the USA if only a negligible amount of foreign content is included.

Transparency

• Clear and Unambiguous Claims: Claims must be explicit and likely not to mislead consumers about the product’s origin. If a product includes U.S. content but is not entirely made in the USA, qualifiers like “Made in the USA with U.S. and imported parts” or “Assembled in the USA” should be used to avoid misleading consumers.

Enforcement and Compliance

• Documentation and Support: Businesses should keep documentation that supports their Made in USA claims. This might include information on the sourcing of materials, manufacturing processes, and the portion of the product’s total cost attributable to U.S. parts and processing.
• Risk of Penalties: False or unsupported claims can lead to FTC actions, including fines and orders to stop marketing the product with misleading labels.

Businesses need to be cautious when labeling products as “Made in USA” and ensure all their claims are accurate, substantiated, and in compliance with FTC guidelines. This helps maintain trust and avoid legal complications. Marashlian & Donahue are here to help you ensure your “Made in USA” claims are compliant with FTC regulations.