Federal Trade Commission Received Documents Jan 22 1996 B18354900092 Secretary American Textile Manufacturers Institute 1801 K Street, N.W., Suite 900 Washington, D.C. 20006-1301 Tel (202) 862-0500 Fax (202) 862-0570 January 22, 1996 Office of the Secretary Federal Trade Commission Room 159 Sixth and Pennsylvania Avenue, NW Washington, DC 20580 Re: "Made in USA" Policy Comment, FTC File P894219 Dear Mr. Secretary: ATMI is pleased to file comments on the Federal Trade Commission's guidelines for evaluating "Made In USA" claims in product advertising and labeling. Though this proposal addresses many industrial and consumer products, it is used to regulate only a few textile items since most of those items are addressed by rules and regulations under the Textile Fiber Products Identification Act (TFPIA). ATMI is the national trade association of the domestic textile manufacturing industry. Member companies operate in more than 30 states and process approximately 80% of all textile fibers consumed by plants in the United States. In 1994, the industry employed 673,000 people and had annual shipments of $74.2 billion. Our industry is strongly supportive of the country of origin rules contained under the TFPIA. We believe these rules are clear, fair and accomplish the goal of notifying consumers of the origin of items before purchase, and therefore all customers have the information needed to make a purchase based on product origin. We believe that the present rules under the TFPIA should not be the subject, either directly or indirectly, of this rulemaking. The focus of our comments will be on thread since that product is exempt from regulation under of the TFPIA. Our comments are filed primarily on behalf of the members of our Thread Committee who produce more than 80% of domestic industrial and consumer thread products. Our Thread Committee basically supports the position taken by the FTC in the past under the FTC Act in determining the origin of thread. We understand that this FTC position is based on commission opinions and requirements under the FTC Act. Specifically, it requires that: Federal Trade Commission January 22, 1996 Page 2 o Thread that is totally domestic in its basic raw materials and manufacture is not required to be labeled for country of origin. However, it is permissible to label this category of product as "Made in U.S.A." o If more than 50% of the total cost (labor and basic raw materials) of the end product is added in the United States, then no country of origin identification is required. However, if a manufacturer or seller volunteers a label or advertisement disclosing the origin of the product, the label or ad should state "Made in the U.S.A. of American and X' country components." o If less than 50% of the total cost of the finished product is added in the United States, then the product must contain a clear and accurate disclosure of its foreign origin, such as "Product of China" or "Made in U.S.A. of Chinese Fiber." We recommend that the commission's origin rules under this act address only the major components of threads -- fibers -- and not de minimis components such as dyes and finishes. As is the case under the TFPIA, the only raw materials considered by textile producers in establishing origin are the fibrous products (natural raw materials such as cotton and synthetic materials like polyester) which are formed into yarns or fabrics. For consistency, this should also be the case for threads labeled under the FTC Act. The Alabama Textile Manufacturers Association, Georgia Textile Manufacturers Association, North Carolina Textile Manufacturers Association and South Carolina Textile Manufacturers Association agree with ATMI's comments and recommendations and asked us to file our statement on their behalf. We request the opportunity to participate in the March 26-27, 1996 workshop in Washington, DC which was announced in the Federal Register on December 19, 1995. ATMI has been an involved party in origin issues affecting textiles for decades, and we want to be sure that the viewpoint of the textile industry is included in the workshop addressing this matter. We appreciate the commission's interest in aspects of origin labeling for threads and we'll be pleased to respond to any questions you may have. Sincerely, Hardy B. Poole Product Services Division