Made in USA Labeling Requirements

The American Apparel & Footwear Association submitted comments to the U.S. Federal Trade Commission (FTC), urging greater clarity and more realistic Made in USA labeling requirements to support U.S. manufacturing.

American Apparel & Footwear Association (AAFA) said in a letter to the FTC:

We write because the case highlights the underlying ambiguity in the Federal Trade Commission’s (FTC) “all or virtually all” Made in USA standard. At a time when U.S. manufacturing is on the resurgent, we believe the case presents a renewed opportunity for the FTC to clarify the meaning of the “all or virtually all” standard.

For apparel, FTC rules have long accommodated this reality through a creative “two‐step” back rule. This enables some U.S. apparel production to be labeled with an unqualified “Made in USA” label provided certain specific input items are also manufactured in the United States. Although it is still too restrictive in our opinion to stimulate more U.S. apparel manufacturing, this approach at least represents one method of providing a degree of certainty to the industry.

Regrettably, no such option exists for footwear and travel goods manufacturers. They have had to figure out how to comply with the Made in USA standard using their best judgement. Some have decided that even if their shoe is 90‐95 percent U.S.‐made, they must still use a qualified Made in USA label, while others have decided that when the majority (over half) of the shoe or travel goods is American‐made, it meets the requirements for an unqualified Made in USA label. And then others don’t use the Made in USA label at all because of the ambiguity of the standard and concern that they might violate it.

Establishing a Made in USA standard that is transparent, clear, measurable, and, enforceable will provide the consumer with confidence that the shoe, backpack, or handbag they are buying meets both the letter and the spirit of the Made in USA label.
Therefore, we propose that the FTC use this opportunity to re‐evaluate its current Made in USA standard and offer a standard that we believe will work for consumers, for manufacturers, and for all other stakeholders. To use an unqualified “Made in USA” label, we propose that the FTC adopt a requirement of substantial transformation + 51 percent value‐added.

For more on the Made in USA Labeling Requirements, see the full letter at www.aafaglobal.org.