Made in the USA Label Claims

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A recent article (read below) from Food Consulting Company discusses the complexity of this label claim.

While it may seem straightforward, the “Made in the USA” claim is surprisingly complex. The Federal Trade Commission (FTC) holds jurisdiction over this particular country-of-origin claim, with the goal of preventing deception and unfairness in the marketplace. The regulations, as established by FTC, apply to products and labeling, advertising, and promotional materials.

To use the Made in the USA claim, the following must be true:

  • “All or virtually all” significant ingredients or components of the product are made and sourced in the United States.
  • The product contains no (or negligible) foreign content.
  • All or virtually all processing of the product takes place in the United States.
  • Final assembly or processing of the product takes place in the United States.

Although FTC does not provide an exact definition for “significant processing” or “virtually all,” FTC considers multiple factors in this determination. Considerations include the percentage of the product’s total manufacturing costs attributable to the U.S., how far removed from the finished product foreign content is, and the significance of the foreign content to the form or function of the final product. While FTC first established its Made in the USA policy in 1997, FTC has only been able to enforce the guidelines with monetary penalties after the codification of a Final Rule in 2021. Penalties can now add up to $43,280 per violation.

Manufacturers should be aware that the FTC law does not supersede other federal statutes or regulations relating to country-of-origin labeling. Special consideration needs to be taken for agricultural products that fall under USDA FSIS or Country of Origin Labeling (COOL) regulations, as USDA’s regulations differ from FTC’s.

Going forward, USDA and FTC are working towards a more consistent approach to regulating these claims. In March 2024, USDA published a Final Rule for FSIS-regulated products that wish to make a voluntary “Made in the USA” claim. To use this claim, the following must be true:

For single-ingredient products:

  • The product is derived from animals born, raised, slaughtered, and processed in the United States.

For multi-ingredient products:

  • All FSIS-regulated ingredients are derived from animals born, raised, slaughtered, and processed in the United States.
  • All other ingredients – other than spices and flavorings – are of domestic origin.
  • Preparation and processing of the product takes place in the United States.

You can read the complete copy of USDA’s Final Rule here.