EXECUTIVE SUMMARY: PUB 2975

• A legislative and administrative history of marking rules, including a comparison of the concepts and approaches for determining country of origin for foreign and domestic goods.

• An analysis of the administrative processes for determining origin and for appealing decisions on marking issues.

• An evaluation of the problems that country-of-origin marking rules create for industry, and the benefits of these rules to consumers. Information should be sought on the costs to government and industry of enforcement and compliance.

The Commission undertook several efforts to ascertain the problems, costs, and benefits associated with country-of-origin marking. A public hearing was held on April 10, 1996, to accept testimony from interested parties, and the Commission also solicited and received written comments. In addition, the Commission conducted an extensive search of consumer literature, examined country-of-origin research as it relates to consumer preference, and contacted a number of consumer and labor groups to obtain information on the benefits of country-of-origin marking rules to consumers. Further, the Commission conducted a telephone survey to ascertain the extent of industry concerns with country of origin marking and to obtain data on the costs of complying with marking requirements. The Commission contacted 512 companies and received responses from 435 companies and trade associations. The Commission interviewed officials of the Federal agencies charged with administering and enforcing the major U.S. laws requiring marking the U.S. Customs Service (Customs); the Federal Trade Commission (FTC); and the U.S. Department of Transportation, National Highway Traffic Safety Administration (NHTSA) and formally requested data on their costs related to marking.

Historical and Global Perspective

• The first U.S. marking statute was enacted in 1890. The basic requirement, which has been in effect for more than one hundred years, is that virtually all imported products (or their containers) must be marked with a foreign country of origin. One purpose of the marking statute is to inform consumers; the statute also operates to "protect" domestic producers. If an imported product is subject to further, significant manufacturing in the United States, then the manufacturer is considered to be the "consumer" of the imported product, and the resulting product does not require a foreign country-of-origin mark.

• Country-of-origin determinations and related markings not only inform consumers of the origin of imported products but also help to enforce trade laws that are applied on a country-specific basis (e.g., application of tariff rates, quotas, antidumping and countervailing duties, embargoes, and qualification for government procurement programs). These laws generally require that each imported product be deemed to have one, and only one, country of origin.

• The country of origin is generally deemed to be the country where the product was last subject to an economically, commercially or technically significant manufacturing or assembly process (a "substantial transformation"), although the country of origin for textiles and apparel is determined under a new set of rules that was enacted in the Uruguay Round Agreements Act (URAA). While virtually all imported products (or their containers) must be marked at the time of importation, any imported product that is substantially transformed in the United States after importation is considered by Customs to be a domestic product that does not need to be marked.

• Origin determinations are susceptible to varying interpretations that may differ, depending on the character of the product, the circumstance of its manufacture, and the purpose for which the origin determination is being made. As a result, origin rules are being re-examined in a variety of venues. The Treasury Department is considering the adoption of uniform U.S. rules of origin that are intended to be more transparent, predictable, and consistent, but that initiative has not received widespread support in Congress or among industry groups. In the Uruguay Round, the contracting parties to the World Trade Organization (WTO) agreed to pursue multilateral harmonization of rules of origin, an initiative that could lead to the establishment of uniform international rules of origin. In addition, the FTC is conducting a comprehensive review of consumer perceptions of "Made in USA" claims in product advertising and labeling, with a view to determining whether to alter the current legal standard.

• The primary marking statute, which is administered by Customs, generally does not apply to products that are made in the United States, although there are marking requirements that apply specifically to domestic automobiles (and light trucks), wool products, and textile fiber products. Some U.S. manufacturers nonetheless choose to mark, label, market, or advertise a domestic product as "Made in USA." In order for such a claim to be valid and acceptable under the federal consumer protection law that is administered by the FTC, the manufacturer must use wholly domestic parts and labor.

• The standard for marking domestic products differs considerably from the standard that applies to imported products. As a result, an imported product may be marked "Made in Japan" as long as it is substantially transformed in Japan; the product does not have to be of wholly Japanese parts. However, an identical product that is made in the United States (i.e., substantially transformed) and sold in the U.S. market could not be marked "Made in USA," unless it is wholly of U.S. origin. On the other hand, if the same product is exported, then foreign marking laws may require that it be marked "Made in the United States."

• The United States is considered to have one of the more broad and complex marking regimes among industrialized nations. The European Union and Japan, by comparison, generally rely on consumer protection laws rather than marking requirements to prevent fraudulent or misleading claims about origin. Australia, Canada, and Mexico generally require only that imports for retail sale be marked. Since many countries have either no specific marking requirement or generally limit marking to goods for retail sale, using a change in tariff classification approach[1] for determining origin may not generate the concern in other countries that has been expressed by U.S. industry representatives. [1] The use of CTC in conjunction with the concept of substantial transformation as an approach to implement NAFTA Marking Rules and to harmonize rules of origin internationally is discussed in chapter 2.

  
  

These issues, and the sometimes inconsistent requirements of various U.S. marking regimes, are some of the principal findings with respect to government and industry costs, and industry concerns associated with country-of-origin marking. Along with benefits that consumers attribute to origin markings, this summary also highlights suggestions of interested parties that may offer alternative approaches for further consideration.

Compliance Costs to Industry

• Industry officials underscored the difficulty many firms have in providing hard cost data. Nevertheless, of the 222 companies[2] that responded to the ITC survey with respect to marking-related compliance costs,[3] virtually all indicated that compliance costs associated with country-of-origin marking do not represent a major share of net sales.[4] However, many companies presenting testimony or submitting written statements noted that compliance costs could be a burden. [2] Representing 51 percent of the 435 companies that responded to the Commission's survey. [3] The major types of costs directly associated with compliance requirements included physical marking; administrative; warehouse, accounting, tracking, and inventory-carrying costs; startup costs (systems, machinery, labeling inventory); expenses for multiple production lines; and marketing/advertising. Also, see appendix F. [4] There are notable exceptions. For example, see marking-related costs estimated by a home furnishings producer (Pillowtex Corp.) associated with implementation of the URAA rules of origin, transcript of hearing, p. 206, and chapter 6 (Textiles and Apparel). See added discussion on costs in chapter 4 and chapter 6.

• Nearly all of the 109 companies that provided either qualitative or quantitative estimates of costs reported that such costs were less than 1 percent of total net sales, or were too small to quantify. Companies indicated that such costs, even if identifiable, could not be passed on to retail customers for competitive reasons. The remaining 113 companies addressing marking-related compliance costs indicated they were unable to provide an estimate, or that costs "are low"[5] and they do not track compliance costs because of the additional accounting and overhead costs that would be required. [5] Although such responses could not be considered for purposes of estimating costs, the responses suggest that some cost, albeit "low" or unable to be estimated, may be incurred in their operations. In response to the ITC survey, virtually all of the companies that were unable to estimate costs nonetheless identified the major types of costs incurred in complying with country-of-origin marking requirements.

• For companies that must begin to track and mark imports,[6] new computer systems, inventory and warehouse requirements, new labels, and new labeling machinery can translate into reported startup costs ranging from $400,000 to several million dollars or more. Also, for companies with sizable total sales, costs that are a small percentage of net sales can translate into millions of dollars.[7] Companies expressed the concern that funds expended in this manner could be invested in other company activities. [6] Companies may need to do this because of new origin regimes (e.g., NAFTA, URAA) or changes in the way Customs interprets substantial transformation or origin determinations. For example, Pillowtex Corp. estimates that implementation of the URAA rules of origin would cost nearly $1.5 million, post-hearing submission, Apr. 19, 1996; Taylor Made Golf Co. estimates marking costs under NAFTA Marking Rules at $1.7 million, with an added $6 million in inventory costs, post-hearing submission, Apr. 22, 1996; substantial transformation and tariff classification shift interpretations are estimated to initially cost food processors at least $8.6 million and a hand tool producer $9 million, see appendix F. [7] For example, Intel Corp. estimates a $4 million annual cost to mark its semiconductors, circuit board assemblies and other products, transcript of hearing, p. 136; this cost represents 0.02 percent of Intel's annual net revenues in 1995 of $16.2 billion (annual 10K report).

• For the companies[8] and organizations representing about 700 firms that provided the Commission with estimates of annual operating costs in complying with country-of-origin marking requirements, an order of magnitude estimate of current and prospective annual operating costs could exceed $100 million (table 4-6, chapter 4).[9] Separate start-up costs to track and mark imports were estimated in a range totaling $37 million to $49 million.[10] [8] Individual company costs reported as a share of net sales range from an estimated low value of $5,000 to a high of $9 million, based on 1995 sales derived from company annual reports and ITC survey data. [9] Cost estimates may be somewhat overstated, based on using a 1-percent figure to calculate costs as a percent of net sales when a response was "less than 1 percent." Costs may be understated due to an inability to quantify costs for qualitative assessments (such as minimal, minor, or low) and the difficulty in acquiring aggregate "industry-wide" cost estimates. The possible magnitude of such industry-wide costs is illustrated by estimates of compliance costs of $50 million per annum provided for one entire industry, for example, representing about 0.01 percent of total net industry sales of $55 billion; post-hearing brief of Semiconductor Industry Association, p. 5. [10] It should be noted that, since response was voluntary and this survey was not a random sample, the survey results may not be representative of particular sectors. Views occasionally diverged between companies within the same industry. There were a number of cases where one company provided cost data while others indicated that they could not quantify the data or believed such costs to be minimal or negligible. Therefore, results from the survey cannot be extrapolated to generalize about a particular industry or the economy as a whole.

• Annual operating costs to comply with the American Automobile Labeling Act (AALA) are estimated to be $2 million in 1995 for 23 automobile producers, according to the National Highway Traffic Safety Administration (NHTSA). Separate start-up costs for these producers were estimated by NHTSA at $13 million. Combined start-up and first-year operating costs of AALA labeling for 15,000 auto parts companies are estimated by NHTSA to range from $600 million to $1.2 billion, averaging $40,000 to $80,000 per firm.

• According to some companies, there are indirect costs associated with the uncertainty of marking requirements. For example, compliance with Customs regulations or decisions that involve "subjective" interpretations, or changes in interpretations of substantial transformation, may cause companies to consider a shift in investment or production to foreign operations. Companies would prefer, for commercial reasons, not to mark a foreign country of origin on certain finished products. Companies believe such markings are misleading to consumers when substantial value-added by their U.S. operations is deemed by Customs as not resulting in a substantial transformation, thus requiring a foreign origin mark. Such rulings, they assert, may diminish the value of existing investments and potentially cause a loss of production and employment for affected companies.

  
  

• The cost to the U.S. Government to administer and enforce the major laws and regulations requiring country-of-origin marking, and preventing deceptive or unfair claims of origin, varied between an estimated $3.3 million to $3.6 million during fiscal years (FY) 1993-95. Administration includes activities such as issuing regulations and rulings. Enforcement includes investigation and court proceedings.

• Customs estimated certain expenditures for administering and enforcing marking requirements at between $1.6 million and $1.8 million during FY 1993-95.[11] These expenditures are primarily salary costs for issuing ruling letters, rulemaking, other legal costs, and investigations of country-of-origin marking violations. However, Customs was unable to provide an estimate of salary costs incurred in reviewing imports for marking sufficiency by personnel at the ports-of-entry, although Customs indicates that such costs are considerable. Based on consultations with Customs personnel costs for issuing marking violations and certifying proper remarking at ports-of-entry would add $850,000 to $1.2 million annually to Customs marking-related costs during FY 1993-95. In addition, Commission estimates of benefits associated with the salary costs related to ruling letters, rulemaking, other legal costs, and investigations of marking violations would add $319,000 to $377,000 to such costs during FY 1993-95. [11] Includes a small share of cost data provided by Customs to the Commission on a calendar year basis.

• The FTC estimated an increase in annual costs from $156,000 to $416,000 during FY 1993-95 for administering and enforcing laws and regulations under the Wool Products Labeling Act of 1939, Textile Fiber Products Identification Act, and Fur Products Labeling Act, and preventing deceptive and unfair acts related to claims of country of origin under section 5 of the Federal Trade Commission Act. The increase in FY 1995 included expenditures for processing two cases alleging deceptive claims of U.S. origin under section 5 of the FTC Act; such cases appear sporadically before the FTC.

• NHTSA estimates that the cost of administering and enforcing the American Automobile Labeling Act (AALA) increased from $91,725 to $136,713 during FY 1993-95. Almost all of NHTSA costs under the Act have been for regulatory rulemaking since its enactment by Congress in November 1992; labeling became effective in August 1994. To date, enforcement has focused on assuring that automobile producers are generating the information required under the AALA.

  
  

• Sixty-eight percent of the 435 companies responding to the ITC telephone survey stated they do not have concerns or problems with U.S. country-of-origin marking requirements. With regard to foreign country-of-origin marking requirements, 78 percent of 381 survey responses indicated that they do not have any problems or concerns.

• Major issues identified by companies and trade associations that expressed concerns about marking requirements are:
  

              
             -   Technical or commercial difficulty of marking 
  	       a product
             -   Administrative burdens and overhead costs 
        	       associated with tracking imported goods 
  	       that are commingled when producing finished 
  	       products
             -   Uncertainty about the marking requirements
             -   Conflict between the various marking laws 
  	       and regulations issued by Customs, NHTSA, 
  	       FTC, the Food and Drug Administration, and
                 other Government agencies
  

• Marking concerns related to origin determinations include:
  

              
             -  Changing interpretations of what constitutes 
  	      substantial transformation and where it occurs
             -  Changes resulting from universal application 
  	      of the "change of tariff classification" 
  	      principle embodied by NAFTA rules of origin
             -  Anticipated problems due to changes in origin 
  	      determination on a most favored nation basis
             -  Lack of harmonization between U.S. and foreign 
  	      regulations, and among various foreign 
  	      regulations, especially differences in the 
  	      applied definitions of substantial transformation
   

• According to many companies, marking issues associated with globalization of production can include:
  

            -  Multiple foreign origin markings on
               products that may misinform and perhaps
               mislead consumers, and do not clarify that
               the processing and manufacture of the
               final product is performed in the United States
            -  A product with foreign content that can be
               sold in foreign markets (Mexico and
               Canada, for example) as "Made in USA" but
               either cannot be sold domestically as
               "Made in USA" or must be marked with a
               foreign origin
            -  A disincentive to use North American
               content and an incentive to procure inputs
               on the basis of non-economic factors, in
               order to limit the marking burden and to
               avoid labeling that would mislead the
               consumer
   

• Opinions vary widely within and between industries with regard to the FTC standard for "Made in USA." The principal concerns expressed were: (1) both the strictness or the perceived weakening of the FTC threshold for unqualified marking of "Made in USA"; (2) inconsistency among the FTC standard, NAFTA or URAA rules of origin regimes, and Customs marking regulations and underlying origin determinations; and (3) inconsistency between the FTC standard and foreign customs' requirements. These inconsistencies can result in requirements to mark goods for export "Made in USA," when these goods cannot be so marked for domestic sale or must be marked with a foreign origin. Similarly, imports that contain components procured in multiple countries are marked based on where substantial transformation occurred; similar products manufactured in the United States are precluded from being marked "Made in USA."

• The current FTC standard for "Made in USA" claims requires that the product's materials and labor be of "wholly domestic" origin. The FTC has proposed in a recent consent agreement to alter the description of this standard to "all or virtually all" of domestic origin, but indicates that the standard itself has not changed; the consent agreement is on hold pending completion of a review of the standard by FTC. Many companies reportedly cannot meet this standard because they purchase components or materials from offshore either to remain cost competitive or because certain inputs are not produced in the United States. In other instances, some U.S. firms have expressed concern that products containing all U.S. components but exported for assembly and then shipped back to the United States cannot meet the threshold for "Made in USA" claims.

• Customs has proposed that the country-of-origin marking rules applied to NAFTA goods (19 CFR 102) be applied to all imports to the United States. This proposal, which uses a change in tariff classification (CTC or "tariff-shift" rules) for determining origin,[12] has raised concern among industries as to how or whether CTC will continue to recognize significant value-added from U.S. operations. Customs has stated that a shift would allow the United States to have a system of uniform rules of origin that could then be proposed to the WTO effort to harmonize rules of origin. A number of companies indicate that the NAFTA rules could represent a change from the current country-of-origin marking requirements and that WTO harmonization may change the requirements for a second time, resulting in an excessive compliance burden. In part as a result of Congressional concerns, Customs has decided that the proposal to extend Section 102 to all trade should not be adopted as a final rule at this time but rather should remain under consideration for implementation at a later date.[13] [12] The CTC approach is generally based on the concept of substantial transformation. [13] 61 F.R. 28933, June 6, 1996.

• Many interested parties offered suggestions for changes to the existing marking regimes. The suggestions that were offered most often were: (1) to limit country-of-origin marking to imported goods for retail sale; (2) to pass legislation excepting certain additional imported products and their containers from country-of-origin marking; and (3) to harmonize the Customs rules of origin and the FTC standard for unqualified "Made in USA" claims. A summary of these suggestions is provided in table A, which appears at the end of this Executive Summary.

  
  

• Country-of-origin marking is perceived by many industry representatives and consumer groups[14] as an important tool that enables consumers to differentiate between domestic and imported products, and to make informed purchase decisions. However, one consumer group, Consumers for World Trade, believes such marking can be misleading and costly, given the complexities of globalized production. [14] Commission contacts or groups providing views included the Consumer Federation of America, Public Citizen, Consumers Digest, The Consumers Union, Consumers for World Trade, Made in USA Foundation, Crafted with Pride in U.S.A., International Brotherhood of Teamsters AFL-CIO, Union Label and Service Trades Department AFL-CIO, and the National Consumers League.

• Country-of-origin is only one of many factors that consumers consider when making a purchasing decision. Often, country of origin is less important than other factors such as price, quality, warranty, product features, brand name, and the reputation of the seller; however, it can be the determining factor when making a purchase decision. Also, research suggests country-of-origin is more important to older than to younger Americans.

• The benefits of country-of-origin marking to consumers are not easily quantifiable. Some industrial consumers underscore the need for stronger enforcement for liability reasons. Research on whether consumers would pay to know the origin of products is limited, but several studies show that consumers are willing to pay more for products made in the United States.

• Consumer studies assessing the value of country-of-origin marking have yielded somewhat inconsistent results, although most domestic consumers indicate a preference for U.S. products over imported products. Consumers vary in their general opinions of how much domestic content a product marked "Made in USA" contains, and expectations of U.S. content vary based on the type of product in question. It also appears that brand names can mislead consumers regarding the perceived origin of a product.

• Country-of-origin marking is more important in certain product areas than others. Products most consistently identified in consumer surveys as being scrutinized for country of origin are automobiles, clothing, and electronics. Some surveys provide evidence that origin may be less important to consumers for certain products such as shoes, furniture, food, and toys.

  
  

During the course of the investigation, interested parties made numerous suggestions regarding alternative marking approaches (table A). Some of the major suggestions are highlighted below.

• While many companies have no concerns with marking requirements, some firms that do have concerns contend that their marking problems may be best addressed by exempting their products from current marking regulations, or by clarifying marking measures to ensure that inaccurate consumer information does not result from the requirement to label certain finished products with a foreign origin. In this regard, certain companies or industries believe that proposed legislation[15] in Congress may eliminate marking burdens that may be inconsistent with commercial realities, while enabling firms to remain internationally competitive and still provide accurate consumer information. Such legislation may increase the administrative burdens of Customs by expanding the number of regulations or exceptions. [15] See chapter 3, table 3-7.

• Some companies that use imported inputs suggest that limiting marking requirements to goods for retail sale could potentially remove much of the controversy arising from inconsistent interpretation of substantial transformation principles. This is especially true for firms where imported production inputs for U.S. operations that confer significant value-added to the final product still require a foreign country-of-origin designation. If production inputs and containers of industrial inputs were excluded, U.S. marking requirements would be more or less harmonized with existing practices of Canada and Mexico as well as the marking requirements of most other countries. U.S. retail consumers would still be informed as to country of origin. Some manufacturers, however, stated that country-of-origin markings provided a relatively inexpensive means of tracking imported components to differentiate product quality and liability, verifying foreign content for buy-domestic requirements, and enabling more effective enforcement by Customs.

• Industry officials note that many of the problems and uncertainties they face regarding substantial transformation determinations could perhaps be eliminated if procedures were codified into rules that are more predictable, consistent, and transparent. Many firms urge that Customs adopt measures to streamline rulings and protest procedures, whereby industry input might be sought in advance of rulings in order to avoid unnecessary litigation and administrative burden. This is especially important to firms in cases where a change in rules or interpretation of origin is envisioned in a pending Customs decision.

• If marking remains a requirement for many goods, particularly production inputs, U.S. producers of certain goods contend that they may be at a competitive disadvantage because of consumer preferences regarding different countries. This occurs under the existing requirement that U.S. producers label domestically-manufactured products with a foreign origin, while foreign producers may be able to label essentially the same product with a country having a more favorable reputation with U.S. consumers.

• With regard to international harmonization of rules of origin, many firms assert that delaying unilateral steps by the United States to establish new U.S. origin rules could avoid the potential requirement for certain industries to face multiple changes to comply with new rules. However, it appears that many of the issues that have developed with respect to country-of-origin marking in the United States may still remain even after WTO harmonization of rules of origin.

• Companies have noted that it may be possible, in some or many instances, to rely solely on consumer protection laws that forbid fraudulent or misleading labeling or that require labeling to inform the consumer of ingredients and other essential information. Such an approach may help to reduce conflicts or redundancies with the requirements for marking imports.

• As a result of a more globalized economy, many U.S. firms cannot meet the unqualified "Made in USA" standard and still remain competitive. The FTC's current review of the existing standard for "Made in USA" labeling has stimulated a number of proposals, including recommendations to align FTC standards with existing Customs rules of origin as a way to address many of the problems of industry.

Table A
Suggestions by interested parties concerning marking laws and regulations

Item/Suggestions/Supports this recommendation, except as noted 


Section 304 of the Tariff Act of 1930

o  Maintain current marking requirements, including strong enforcement of the law.

     Agriculture:  Burnette Foods, Florists' Transworld Delivery (FTD) 
     Association, International Brotherhood of Teamsters AFL-CIO, 
     Mason Country Fruit Packers Co-op, Inc., Michigan Agricultural 
     Cooperative Marking Association, Inc. (MACMA), Morrison Orchards, 
     United Foods, Inc.
     Textiles and apparel:  American Apparel Manufacturers Association (AAMA), 
     American Textile Manufacturers Institute (ATMI), Crafted With Pride in
     U.S.A. Council, Inc. 
     Cutting tools:  Allied Machine & Engineering Corp., Cogsdill Tool 
     Products, Inc., Criterion Machine Works, Jarvis Cutting Tools, Inc., 
     Keo Cutters, Koncor Industries, Moon Cutter Co., Inc., Precision 
     Twist Drill Co., SGS Tool Co., Talbot Holdings, Ltd., United States 
     Cutting Tool Institute (USCTI)
     Hand tools:  Component Specialty, Inc., Danaher Corp., Snap-on, Inc., 
     Laclede Steel Co., Vaughan & Bushnell Manufacturing Co., Wright Tool Co.
     Steel products:  American Pipe Fittings Association (APFA), Committee of 
     Domestic Steel Wire Rope and Specialty Cable Manufacturers, Committee on 
     Pipe and Tube Imports (CPTI), Diamond Chain Co., Weldbend Corp., 
     Wheatland Tube Co. 
     Others:  AFL-CIO Union Label & Service Trades Department, 
     Eastman Kodak Co., Made in the USA Foundation, McPhillips Manufacturing Co., 
     Inc., Municipal Castings Fair Trade Council, Oneida, Ltd., Torrington Co., 
     United States Tuna Foundation

o  Limit marking to imports for retail sale (i.e., consumer goods);
o  Eliminate marking requirements on industrial products;
o  Limit marking to certain products.
     American Wire Producers Association (AWPA), Digital Equipment Co., 
     Eli Lilly and Co., Intel Corp., Joint Industry Group (JIG), 
     National Council on International Trade Development (NCITD), 
     Natural Feather & Textiles, Inc., Pharmaceutical Research and
     Manufacturers of America (PhRMA), law firm of Sonnenberg & Anderson, 
     Kraft Foods, Inc., Xerox Corp.

o  Exempt certain products from marking:
   o semiconductors     
       Semiconductor Industry Association (SIA) and Intel Corp.; 
       In opposition:  Micron Technology Corp.
   o spare parts for repairs, including repair kits for photocopiers
       Xerox Corp., Digital Equipment Corp.
   o parts, components, and subassemblies imported for repair and/or then 
     reexported
       Aerospace Industries Association (AIA), Digital Equipment Corp., 
       Automotive Parts Rebuilders Association
   o metal forgings for hand tools 
       Rep. Nancy L. Johnson (R-6-CT), Sr. Member, House Ways and Mean 
       Committee, The Stanley Works, Fleet Bank 
       In opposition:  Component Specialty, Inc., Danaher Corp., Snap-on,Inc., 
       Vaughan & Bushnell Manufacturing Co., Wright Tool Co.
   o food products
       Pillsbury Co., Joint Industry Group (JIG)
   o vinyl flooring
       House Corp. (Canada, with U.S. subsidiary)
   o accessories and components packed for retail sale with finished 
       electronics products
       American Association of Exporters and Importers (AAEI)
   o golf clubs and parts thereof
       Ajay Sports, Inc., Coastcast Corp., Daiwa Corp.,
       Lamkin Leather & Rubber Co., Lynx Golf, Taylor Made
       Golf Co., Inc., Joint Industry Group (JIG)

o  Require marking on certain products:
   o door hinges
     Hager Hinge Co.
   o perishable food items, including cut flowers
     Floral Trade Council; In opposition: Florists'Transworld 
     Delivery (FTD) Association

o  Eliminate marking altogether.
     Customs Advisory Services, Inc., Deloitte & Touche LLP, 
     International Business-Government Counselors, Inc. (IBC)

o  Eliminate marking of products with commingled ingredients or develop a 
     workable rule for marking commingled goods.
     American Frozen Food Institute (AFFI), Kraft Foods, Inc., 
     National Food Processors Association, Pillsbury Co. 

o  Modify Customs interpretation of marking requirements under section
     334 of the Uruguay Round Agreement Act with respect to textile home
     furnishings. 
     Paris Accessories, Inc., Pillowtex Corp.

o  Allow more generic origin labels (e.g., "Made in Europe").
     International Mass Retail Association (IRMA)

o  Modify Customs regulation at 19 CFR 134.46 which is used to discriminate
     against footwear.  Regulations should be modified to allow footwear to 
     be treated in the manner of other merchandise and not require close
     proximity marking and equal size requirements when U.S. geographic name 
     is used.
     Footwear Distributors and Retailers of America (FDRA)

o  Modify section 1304(c) to read "In any event, no item which is otherwise
     required by law or applicable industry standard or custom to be marked 
     on the outside with technical or other product information shall be 
     entitled to an exemption from marking."
     Committee on Pipe and Tube Imports (CPTI)

o  For certain pipe and fittings under 19 U.S.C. 1304(c), limit the 
     application of exceptions under 19 U.S.C. 1304(a)(3) to only NAFTA 
     parties.
     Committee on Pipe and Tube Imports (CPTI)

o  Reword 19 U.S.C. 1304a(3)(G) and reverse Customs' past rulings to except 
     products that are significantly processed but not substantially 
     transformed from marking requirements.
     Cold Finished Steel Bar Institute

o  Require stricter marking to show country of manufacture of materials and 
     country of processing.
     Newcomer Products, Inc. (cutting tools)

Section 102 NAFTA Marking Rules for NAFTA goods 

o  These rules are adequate.
     Eastman Kodak Co.

o  Repeal these rules for NAFTA goods.
     Fuji Vegetable Oil, Inc.

o  Modify these rules for NAFTA goods to conform with section 304 and to 
     clarify instances where a change in tariff classification principle 
     does not consider significant value-added in a substantial 
     transformation by operations in the United States.
     American Frozen Food Institute (AFFI), Kraft Foods, Inc., 
     Natural Feather & Textiles, Inc. 

o  Reinstate original tariff shift rule for marking golf clubs as of 
     Jan. 3, 1994.
     Hitchiner Manufacturing Co., Inc., Ajay Sports, Inc., Coastcast Corp., 
     Daiwa Corp., Lamkin Leather & Rubber Co., Lynx Golf, 
     Taylor Made Golf Co., Inc.

o  Eliminate 19 CFR 102.14, regarding goods returned to the United States
     after being processed in other NAFTA countries.  Customs is eliminating 
     this regulation, effective August 5, 1996 (61 F.R. 28935, June 6, 1996).
     Golf clubs and parts:  Ajay Sports, Inc., Coastcast Corp., 
     Daiwa Corp., Lamkin Leather & Rubber Co., Lynx Golf, 
     Taylor Made Golf Co., Inc.

Extend section 102 NAFTA Marking Rules to all imports 

o  Apply the section 102 NAFTA Marking Rules to all imports.
     Copper & Brass Fabricators Council, Inc., P.B. Feller,
     McKenna & Cuneo, Specialty Steel Industry of North America (SSINA), 
     Vaughan & Bushnell Manufacturing Co.

o  Do not extend the section 102 NAFTA Marking Rules to all imports.
     American Frozen Food Institute(AFFI), Eli Lilly and Co., 
     Pharmaceutical Research and Manufacturers of America (PhRMA), 
     The Stanley Works, Weldbend Corp., Xerox Corp.
     Golf clubs:  Ajay Sports, Inc., Coastcast Corp., Daiwa Corp., 
     Lamkin Leather & Rubber Co., Lynx Golf, Taylor Made Golf Co., Inc.

FTC standard for unqualified statements of "Made in USA" label

o  Maintain the FTC standard as is.
     Hand tools:  A distributor for Mac Tools, Component Specialty, Inc., 
     Danaher Corp., Snap-on, Inc., Vaughan & Bushnell Manufacturing Co., 
     Vulcan Forge and Machine Co. of San Jose, Inc., Wright Tool Co.
     Other:  AFL-CIO Union Label & Service Trades Department, 
     American Textile Manufacturers Institute (ATMI), 
     Crafted with Pride in U.S.A. Council, Inc., Diamond Chain, Co., 
     Eastman Kodak Co., National Association of Hosiery Manufacturers (NAHM),
     Welbend Corp. 

o  Harmonize the FTC standard with section 304, and base the FTC standard 
     on the last substantial transformation test.
     Digital Equipment Corp.

o  Change the FTC standard to include consideration of significant 
     value-added to products through U.S. operations.
     Hand tools:  Fleet Bank, The Stanley Works 
     Other:  Bicycle Manufacturers Association of America, Inc., 
     Brown & Williamson Tobacco Corporation, Electronic Industries 
     Association, Brass Craft Manufacturing Co., Footwear Distributors and
     Retailers of America (FDRA), Made in the USA Foundation, 
     law firm of  Sonnenberg & Anderson

o  Harmonize the FTC standard for labeling textile fiber products with
     section 334 of the URAA to allow proper marking of textile home
     furnishings.
     Paris Accessories, Inc.

American Automobile Labeling Act (AALA) Repeal, modify, or do not use the
  AALA.
  American International Automobile Dealers
  Association (AIADA), Association of International
  Automobile Manufacturers, Inc. (AIAM)

Other laws or regulations Harmonize hull identification numbers (HIN) 
  in 33 CFR 181 with International Standards Organization standard.
  National Marine Manufacturers Association (NMMA)

Rules of origin

o  Base all origin determinations on a change in tariff classification.  
     National Council on International Trade Development (NCITD), 
     Association of International Automobile Manufacturers, Inc. (AIAM)
     
o  Harmonize section 304 of the Tariff Act of 1930 to conform with the Food
     and Drug Administration's definition of manufacturing processes 
     for drugs.
     Eli Lilly and Co., Pharmaceutical Research and Manufacturers of 
     America (PhRMA)
     
o  Modify, amend, or repeal section 334 of the Uruguay Round Agreements
     Act.
     Natural Feather & Textiles, Inc.
     
o  Harmonize all U.S. Government rules of origin.
     American Association of Exporters and Importers (AAEI), 
     Brass Craft Manufacturing Co., The Federation of the Swiss 
     Watch Industry, W. D. Outman II, Baker & McKenzie, The Stanley Works
     
o  Harmonization rules of origin through WTO.
     International Mass Retail Association (IMRA),
     Specialty Steel Industry of North America (SSINA),
     The Federation of the Swiss Watch Industry, 
     Vaughan & Bushnell Manufacturing Co.

Customs regulations and procedures 
 
o  Streamline rulings procedures under 19 CFR 177.
      Natural Feather & Textiles, Inc., Pillsbury Co., Xerox Corp.
      
o  Do not modify/revoke rulings Customs previously issued to National 
      Hand Tool Co.
      Rep. Nancy L. Johnson (R-6-CT), Sr. Member, House Ways and 
      Means Committee, Consolidated Casting Corp., 
      Lone Star Gas Co., Plymouth Tube Co., Rack Technology, Inc., 
      The Stanley Works 

o  Review Customs' process for determining when a product undergoes 
      a substantial transformation. 
      American Institute for International Steel, Inc., BGE Ltd.,  
      Brown & Williamson Tobacco Corporation
      
Source: Compiled by the staff of the U.S. International Trade Commission.