Certificate of Conformance for Country of Origin - Made in the USA claim

I dont know but I DO KNOW for the US Govt and "Made in the USA" and assistance from the Dept Of Commerce, the essence of whatever the device is must take form in the USA and contain a certain % (50%) of the cost.

We asked the US GOVT for help promoting our device and they required a priced BoM and the supplier locations for them to review.

Ed Panek said:

... the essence of whatever the device is must take form in the USA and contain a certain % (50%) of the cost...

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Some seemingly nebulous terms here: "essence" and "cost".

Regarding "essence": relating to the example in my previous post (components:USA, assembly:China, testing/packaging: USA), I presume that this would then NOT qualify, as the "essence" of the product (an assembled PCB) arguably was realized at the China facility?

Regarding "cost": I'd presumed from the wikipedia article that the "50%" figure related to input sub-components/parts and their origin. If mere "cost" is a factor then this changes the calculation. Again, from my hypothetical example (components:USA, assembly:China, testing/packaging: USA), so long as the cost of US-activities is >50% of the cost of the China activities, then the criteria is met? Seems a bit strange if this is accurate...

Hypothetical - If you sold a thermometer that "costs" $5 from China and add a platinum label to it that adds $100 I dont think its a USA made product.

Example: A company produces propane barbecue grills at a plant in Nevada. The product’s major components include the gas valve, burner and aluminum housing, each of which is made in the U.S. The grill’s knobs and tubing are imported from Mexico. An unqualified Made in USA claim is not likely to be deceptive because the knobs and tubing make up a negligible portion of the product’s total manufacturing costs and are insignificant parts of the final product.
Example: A table lamp is assembled in the U.S. from American-made brass, an American-made Tiffany-style lampshade, and an imported base. The base accounts for a small percent of the total cost of making the lamp. An unqualified Made in USA claim is deceptive for two reasons: The base is not far enough removed in the manufacturing process from the finished product to be of little consequence and it is a significant part of the final product.

Complying with the Made in USA Standard

Ed Panek said:

Hypothetical - If you sold a thermometer that "costs" $5 from China and add a platinum label to it that adds $100 I dont think its a USA made product.

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Agreed - which is why consideration of "cost" seems weird to me. ...but regardless, the FTC guidance you linked does explicitly say: "Manufacturers and marketers should use the cost of goods sold or inventory costs of finished goods in their analysis. Such costs generally are limited to the total cost of all manufacturing materials, direct manufacturing labor, and manufacturing overhead."

That said, the guidance also says cost is a secondary consideration: "The product’s final assembly or processing must take place in the U.S. The Commission then considers other factors, including how much of the product’s total manufacturing costs can be assigned to U.S. parts and processing, and how far removed any foreign content is from the finished product."

All in all, it seems quite subjective. In the "table lamp" example given, I would have thought the "Made in USA" claim would have been ok: final processing (assembly) in USA, most components American-made... ...but I guess not...

Mark Meer said:

Interesting discussion. I'm not too familiar with Country of Origin (COO) regulations, but from the wikipedia link Jim posted, it says "a product be manufactured in the U.S. of more than 50 percent U.S. parts to be considered Made in USA". For PCBs, that might be a tough requirement to meet given how many electronic components are manufactured overseas these days...

Also, for the sake of argument/discussion, consider the following hypothetical situation:

• 50%+ PCB components are manufactured in US
• All components are drop-shipped to China for PCB assembly
• Assembled PCBs are then sent back to US headquarters
• Received PCBs are tested and packaged in the US facility

In the above case, could the company claim PCBs are made in USA?

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Yeah, that would be a question for a lawyer in this field. Thanks for the reply.

Another component to this is that the companies who are purchasing these boards in the U.S. are unaware that these boards are made in China, as well as the pricing component.

DonaldC said:

PCB boards made in China be repackaged and sold as made in the USA

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DonaldC said:

the companies who are purchasing these boards in the U.S. are unaware that these boards are made in China

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I am not a lawyer...but I do know that there are 7 burdens of proof:
- Intentional
- Misrepresentation
- of a material fact
- by the offeror
- to the offeree
- Which induces the offeree into the contract
- and causes harm
.........that's why I mentioned the word "fraud" up front.
Looks like you've got the first 6 covered so far (#6 is my assumption based on data given), jury's out on the seventh with the data shared so far.

I trust that management is already talking to counsel (certainly hope so). Time to duck and cover.