As tariffs influence American buying habits, more consumers are looking for 'Made in USA' labels to avoid import fees and support local businesses. However, the 'Made in USA' designation can be misleading, as it enables the inclusion of foreign components under specific circumstances, as long as the final assembly occurs in the U.S. The Federal Trade Commission stipulates that a significant part of manufacturing costs must be domestic. Understanding the 'substantial transformation' test, originating from a 1908 Supreme Court case, further reveals the complexities of product origin claims.
The 'Made in U.S.A.' label requires that all or virtually all parts and assembly must originate from the USA, but allowing some foreign components can be misleading.
The concept of substantial transformation has roots in a 1908 Supreme Court case. The Court determined that non-transformative foreign components could still qualify for domestic labeling.
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