FTC: Fake Made in USA Claims are now $43,280 per Violation

Agency to Focus on Mergers, Repeat Offenders, Big Tech Companies, the Healthcare Industry, Harms Against Workers and Small Businesses

“Marketers making unqualified Made in USA claims on labels should be able to prove that their products are “all or virtually all” made in the United States,” the FTC said. “(This rule) will enable the Commission for the first time to seek civil penalties of up to $43,280 per violation of the rule…. While stiff penalties are not appropriate in every instance, they send a strong signal to would-be violators that they abuse the Made in USA label at their peril.”

The Federal Trade Commission voted to approve a series of resolutions authorizing investigations into key law enforcement priorities for the next decade. Specifically, the resolutions direct agency staff to use “compulsory process,” such as subpoenas, to investigate seven specific enforcement priorities. Priority targets include repeat offenders; technology companies and digital platforms; and healthcare businesses such as pharmaceutical companies, pharmacy benefits managers, and hospitals. The agency is also prioritizing investigations into harms against workers and small businesses, along with harms related to the COVID-19 pandemic. Finally, at a time when merger filings are surging, the agency is ramping up enforcement against illegal mergers, both proposed and consummated.

In remarks delivered during the open meeting, Chair Lina M. Khan noted that the resolutions approved today represent an important step in rethinking the work of the FTC. Instituting new cross-agency, investigatory resolutions will promote a more holistic use of the FTC’s enforcement authorities to stop bad actors across markets.

“The reforms are designed to ensure that our staff can comprehensively investigate unlawful business practices across the economy,” said Chair Khan. “They will help relieve unnecessary burdens on staff and cut back delays and ‘red tape’ bureaucracy when it comes to advancing our Commission’s law enforcement priorities. This is particularly important given that we are in the midst of a massive merger boom.”

Compulsory process refers to the issuance of demands for documents and testimony, through the use of civil investigative demands and subpoena. The FTC Act authorizes the Commission to use compulsory process in its investigations. Compulsory process requires the recipient to produce information, and these orders are enforceable by courts. The Commission has routinely adopted compulsory process resolutions on a wide range of topics. Many of these resolutions cover specific industries, like the automobile industry or the postsecondary education industry, while others involve business practices that cut across sectors, like privacy or the targeting of older Americans.

The actions taken today will broaden the ability for FTC investigators and prosecutors to obtain evidence in critical investigations on key areas where the FTC’s work can make the most impact. Each omnibus authorizes investigations into any competition or consumer protection conduct violations under the FTC Act. The omnibuses will also allow staff to use compulsory process to investigate both proposed mergers and consummated mergers. Individual Commissioners will continue to be required to sign compulsory process documents prior to issuance. With these in place, the FTC can better utilize its limited resources and move forward in earnest to fix the market structures that allow the worst predators to proliferate.

2. At the meeting, we voted to adopt a final Made in USA rule, which will let us more effectively deter & protect the public from Made in USA fraud. Commissioner @chopraftc’s statement explains how this rule turns the page on a permissive approach.

3. We also voted to revise procedures that govern rules targeting unfair or deceptive practices, bringing the FTC in line with statutory requirements. Commissioner @RKSlaughterFTC explains how this will equip the agency to issue clear & timely rules.

4. We voted to rescind a 2015 statement that unduly constrained FTC’s authority to police “unfair methods of competition”—the first step in our work to clarify Section 5. My statement explains how the 2015 statement contravened a congressional directive.

5. Finally, we voted to adopt a set of resolutions that will empower agency staff to investigate healthcare & pharmaceuticals, technology platforms, repeat offenders, harms against workers and small businesses, and harms related to the COVID-19 pandemic.

  1. Weber Grills is still claiming that their gas grills are “Made in USA” but then says “from globally sourced materials “. Literally ALL of their parts are MADE IN CHINA and theN only assembled in USA. I have and email from their support dept that makes this statement. They should be investigated.

  2. Thank you for all you do! I’m so tired of trying to find out where a product is made while shopping online. Now, if I can’t find out quickly, I move on. I also read labels in retail stores and refuse to buy “Made in China” items. I’ve done that for years. I even wrote a paper on it for a college class one time. So thank you again. It hadn’t occurred to me that it might say it was made here and truly wasn’t. Keep up the good work!

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