FTC Deters Rampant ‘Made in USA’ Fraud Ahead of 4th of July

The Federal Trade Commission (FTC) finalized a new rule that will crack down on marketers who make false, unqualified claims that their products are Made in the USA.

Under the rule, marketers making unqualified Made in USA claims on labels should be able to prove that their products are “all or virtually all” made in the United States.

The agency said the rule would especially benefit small businesses that rely on the Made in USA label but lack resources to defend themselves from imitators.

For the first time, the FTC will be able to seek civil penalties of up to $43,280 per violation of the rule.

“While stiff penalties are not appropriate in every instance, they send a strong signal to would-be violators that they abuse the Made in USA label at their peril,” according to Thursday’s announcement.

Note that the rule does not impose any new requirements on businesses.

Instead, it codifies the FTC’s longstanding enforcement policy statement regarding U.S.-origin claims. “By codifying this guidance into a formal rule, the Commission can increase deterrence of Made in USA fraud and seek restitution for victims.”

You can find the full announcement on the FTC.gov website.

Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.