By Dan Flynn on September 16, 2020
A 60-day comment period for the Federal Trade Commission’s “Made in the USA” label ended Monday with 838 submissions that favor a crack-down on unqualified U.S-origins claims on product labels.
And the No. 1 maker of those unqualified claims was named in many of the comments — Secretary of Agriculture Sonny Perdue.
“My name is Wade Fox I am a (South Dakota) cattle producer,” his comment said. “The conflict is this: While the FTC wants to ensure that only products actually made in the USA bear a “Made in the USA” label, the Secretary of Agriculture has a policy that says a foreign beef product that enters the USA and is subject to only minor processing, such as being taken out of a big box and packaged in smaller boxes, can bear a “Product of USA” label.”
“This is the very kind of conflict the FTC needs to hear about,” Fox added. “The U.S. Dept. of Agriculture’s (USDA)’s policy that allows a USA label on imported beef deceives consumers and should be considered fraud.”
The USDA watered down its Country of Origin Labeling (COOL) for meat five years ago. Previously it had required “Made in USA” labeling only for meat that was born, raised, and slaughtered in this country. Canada and Mexico claimed the stronger requirement was an unfair barrier to trade, and the World Trade Organization (WTO) ruled against the United States.
The USDA then watered down the rule after Congress decided it did not want to pay retaliatory tariffs that WTO was going to grant Canada and Mexico. Consumers and some independent beef producers want the stronger COOL label restored, consistent with where the FTC is going on the issue.
FTC’s involvement adds a new twist, but its involvement in preventing deceptive “Made in USA” claims goes back to at least 1940. Congress gave the FTC separate authority to enforce Made in USA labels.
“For 80 years, the Commission has pursued enforcement actions that have established the principle that unqualified MUSA claims imply no more than a de minimis amount of the product is of foreign origin,” FTC’s call for comments said.
“In 1997, following consumer research and public comments, the Commission published its Enforcement Policy Statement on U.S. Origin Claims (“Policy Statement,”) elaborating that a marketer making an unqualified claim for its product should, at the time of the representation, have a reasonable basis for asserting that “all or virtually all” of the product is made in the United States.
Comments that have been submitted indicate the problem of Made in USA labels ending up on foreign products goes beyond meat and poultry.
“I am in support of the USA Labeling Rule,” wrote Texan Carl Graham. “First and foremost, I want to support the producers and suppliers of food originating in the U.S. Secondly, I am extremely frustrated with the majority of restaurants that claim to sell U.S. produced shrimp and upon further questioning of managers and waiters learn that the product is foreign.
“I do not want to consume farm-raised shrimp from foreign countries and this regulation should assist me in assuring I am receiving what I order when dining out. Knowing that I am receiving U.S. products, especially shrimp, will allow me to comfortably order the product. There are only a few dining facilities that I trust when I order shrimp. This legislation will expand my choices and provide assurance that I am receiving what I order,” he added.
A North Dakota rancher says he supports the FTC rule. “I believe it should be born, raised, and slaughtered in the USA to be eligible for a label to say made in the USA,” he said.
The FTC “may from time to time issue rules pursuant to section 553 of title 5, United States Code” requiring MUSA labeling to “be consistent with decisions and orders of the Commission issued pursuant to section 5 of the [FTC] Act.” The FTC may seek civil penalties for violations of such rules
To use a Made in the USA label, it will require : (1) Final assembly or processing of the product occurs in the United States, (2) all significant processing that goes into the product occurs in the United States, and (3) all or virtually all ingredients or components of the product are made and sourced in the United States. The labeling requirements extend to mail-order catalogs and advertising.
The Commission welcomed comments on whether the NPRM conflicts with any state country-of-origin labeling requirements, such as USDA’s.
And the hitch may come with this statement: “To avoid confusion or perceived conflict with other country-of-origin labeling laws and regulations, the NPRM specifies that it does not supersede, alter, or affect any other federal or state statute or regulation relating to country-of-origin labels, except to the extent that a state country-of-origin statute, regulation, order, or interpretation is inconsistent with the NPRM.”
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