USDA to review ‘Product of USA’ label following FTC vote
Agriculture Secretary Tom Vilsack announced today that USDA will review the “Product of the USA” label for meat managed by the Food Safety and Inspection Service after the Federal Trade Commission voted to strengthen its enforcement of products labeled Made in the USA.
“Today, the Federal Trade Commission took important steps to enhance its ability to enforce the Made in USA standard,” Vilsack said.
“I congratulate the FTC on strengthening this important protection for American consumers. USDA will complement the FTC’s efforts with our own initiative on labeling for products regulated by FSIS, an area of consumer labeling where USDA has a long tradition of protecting consumers from false and misleading labels.”
Both the National Cattlemen’s Beef Association and the U.S. Cattlemen’s Association, who have had opposing views on labeling, praised the decision to review the label.
U.S. cattle and farm groups have long been at odds over proper labeling. Under current “Product of the USA” rules, beef that comes from many countries, but particularly from Canada and Mexico, is considered a product of the United States if it has been processed within the country.
The U.S. Cattlemen’s Association and some other farm groups favor a strict country-of-origin rule for meat labeling, but when Congress put that into effect, a World Trade Organization panel said it resulted in discrimination against Mexican and Canadian cattle and Congress repealed the law.
NCBA opposed the strict country-of-origin labeling rule.
The FTC voted along party lines to approve a rule tightening who can claim that goods are “Made in USA,” Reuters reported.
Democrats, including Lina Khan, the newly Senate-confirmed progressive FTC chair, voted for the rule, while the Republican members of the commission voted against it, Reuters said.
The FTC meeting was online but public, a change from previous custom, Reuters said.
Jeff Greenbaum of Frankfurt Kernit Klein & Selz PC said on Lexocology this week that the vote “would codify the principles set forth in the FTC’s Enforcement Policy Statement on U.S. Origin Claims, a 1997 document.”
Greenbaum noted that the FTC had said, “The rule would help ensure that consumers can confidently buy American, and that honest companies can realize the benefits of the Made in USA Label.”
The rule will take effect in 30 days after publication in the Federal Register.
In further comments, Vilsack said, “After considering the many comments received by the FTC and USDA on this issue, we are initiating a top-to-bottom review of the ‘Product of USA’ label that will, among other things, help us to determine what that label means to consumers.”
“We believe this review will enable our upcoming rulemaking on the topic, announced in the Biden-Harris administration’s Spring Regulatory Agenda, to be comprehensive, effective, and lasting.
“I am committed to ensuring that the ‘Product of USA’ label reflects what a plain understanding of those terms means to U.S. consumers,” Vilsack said.
“Throughout the rulemaking process, we will be asking questions, collecting data, and requesting comments. And we will be considering all ideas suggested by the whole range of stakeholders, including our trading partners with whom we will engage to ensure that this labeling initiative is implemented in a way that fulfills our commitment to working cooperatively with our trade partners and meeting our international trade obligations.”
The National Cattlemen’s Beef Association commended the USDA for announcing the review, but noted that it “has long-advocated for voluntary labels that meet consumer demand and allow producers to distinguish their products in the marketplace.”
NCBA noted that it had recently filed a petition with USDA’s Food Safety and Inspection Service to eliminate the use of “Product of USA” and other broad U.S. origin labeling claims for beef products in favor of a “Processed in the USA” label.
“The ‘Product of the USA’ label is not subject to source verification, is not tied to any kind of food safety standard, and is applied by packers and retailers in a manner that does not deliver value back to the cattle producer,” said NCBA President Jerry Bohn.
“This label not only misleads consumers, it is yet another barrier to producers gaining leverage and distinguishing their product in the marketplace,” Bohn said.
“NCBA members have voiced concerns about the potentially misleading use of the label and we thank USDA for responding to those concerns and recognizing that non-source verified labels are a disservice to producers and consumers alike. We look forward to working with USDA to find labeling solutions that represent investments made by producers to continually improve their product and meet consumer demand.”
NCBA also noted that when it submitted comments to the FTC on the proposed rule in 2020 it reminded the FTC that USDA has primary jurisdiction over all meat food product oversight activities, including the approval and verification of geographic and origin labeling claims.
“While the FTC and USDA announcements may have similarities, NCBA believes that USDA is the best-equipped agency to properly oversee beef labeling and we support USDA’s continued jurisdiction over labeling of meat food products,” the group said.
The U.S. Cattlemen’s Association, a competing cattle group, said, “This is a positive step towards closing the ‘Product of the U.S.A.’ loophole”
“In 2019, USCA submitted a petition for rulemaking to USDA’s Food Safety and Inspection Service requesting ‘Product of the U.S.A.’ claims refer exclusively to cattle born, raised and harvested in the U.S. We have reiterated that request to both USDA and FTC in public comment responses.
“During this review period, we ask that USDA work hand-in-hand with industry stakeholder groups to help shape the definition of what truly constitutes a U.S.A. Made product.”
–The Hagstrom Report
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