Many importers are familiar with the marking and labeling requirements for products imported and sold in the United States. These include mandatory requirements such as US Customs country of origin marking and labeling requirements, Federal Communications Commission labeling for certain electronic equipment, specific labeling for certain consumer products. under the Federal Trade Commission and the Consumer Products Safety Commission, as well as a host of other mandatory marking and labeling requirements from other regulatory agencies for specified products.
There are also requirements and restrictions associated with “voluntary” marking and labeling practices, including the regulation of “Made in USA” marking, the use of trademarks or trade names, and other labeling and prohibitions of use false statements or misleading product descriptions on packaging and labeling. These may lead to enforcement action by administrative authorities and may also result in civil lawsuits and potential monetary damages orders or settlements under state and federal misleading advertising laws.
But what about US laws that affect products that are sold for export only and will not enter the mainstream of commerce in the United States? In this case, we are not talking about the marking and labeling requirements in the country of destination, which must of course be taken into account, but which are essentially the responsibility of the importer of the goods in the country of destination – in the same way that the US importer of record is responsible for meeting the above mandatory and voluntary marking requirements, foreign suppliers are essentially outside the jurisdiction of US Customs and other US agencies.
A basic example of U.S. laws that may restrict certain markings and labels on products intended for export relates to the prohibition on the use of “counterfeit” trademarks or trade names. These prohibitions are specifically addressed under 18 U.S. Code § 2320 – Trafficking in counterfeit goods or services, which provides that it is a punishable offense to … “traffic in goods or services and knowingly use an infringing mark on or in connection with such goods or services”. The term “trafficking” applies to both imports and exports, and these counterfeit goods would be considered contraband that cannot be traded legally, and the law provides for severe civil and criminal penalties.
Aside from counterfeiting, a common misunderstanding is that when the goods are otherwise for export, there are no US marking and labeling regulations or restrictions. Some exporters believe it is permissible to include blatantly incorrect marking or labeling claims on their exported products. An example of this includes affixing a “Made in USA” label to goods that contain 100% imported goods and have not undergone any further processing in the United States. This type of marking would violate marking requirements under most free trade agreements the United States has in place and would also be suspect in connection with U.S. Census Bureau documents that require exporters to declare whether the commodity is “foreign” or “domestic”. Essentially, an exporter would have to falsely declare the merchandise as “domestic” in order for their product labeling to match their “Made in USA” claims, and thus be in violation of the US Census Bureau requirements.
Other requirements may apply to exported goods, including those related to certain consumer products that have specific labeling requirements. An example is the Flammable Fabrics Act (FAA – 15 US Code § 1193; 16 CFR Part 1615) which contains specific labeling requirements. The law prohibits “the sale or offering for sale, in trade . . . of any product, fabric or related material that does not comply with an applicable standard or regulation”. The law defines “commerce” as “commerce between more than one state or with foreign nations”. Therefore, all FAA requirements, including labeling requirements, may be applicable in the event of a violation involving sales outside the United States.
Although many mandatory marking requirements for goods imported and sold in the United States do not apply to goods exported, compliant exporters will take steps to ensure that the marking and labeling of their products contains information correct and justifiable, particularly with respect to brands and products of origin, and that all US labeling requirements are met with respect to consumer protection laws, as these may have extraterritorial applicability and enforceability.