9 replies to this topic

[mixican]

Hello all,

 

I've discussing this matter with my client and my co-workers regarding "Product of USA" claim.

 

We import Natural Sesame Seeds from foriegn contry, China for instance, and roast them at our facility in US.

Can we claim this product to be "Product of USA" or it is "Product of China".

 

My client believe that this product should be claimed as "Product of China" due to the fact that country of origin of raw material is China, and that our production, roasting production, is not a "substantial transformation" of the products meaning you can still identify the product to be Sesame Seeds after roasting...

My co-workers believe that the product can be considered as "Product of USA" due to Roasting production that raw materials were undergone.

 

Please let me know what you think.


 

[Slab]

Hi, Mixican;

 

I would agree with your assessment that the product is significantly transformed as this is a thermal process (raw to cooked). I would argue (if challenged) that the roasting process is sufficient to eliminate pathogens, and that other receiving controls address perhaps environmental contaminants (as you are under the scope part 117)? Prove this with a process study and a PC plan.

 

I would however seek bonafide legal council which I'm sure your company is paying on retainer.

 

19 CFR 10.12 [Title 19 -- Customs Duties; Chapter I -- U.S. Customs and Border Protection, Department of Homeland Security; Department of the Treasury; Part 10 -- Articles Conditionally Free, Subject to a Reduced Rate, etc.], a product of the U.S. is “an article manufactured within the Customs territory of the U.S. and may consist wholly of U.S. components or materials, of U.S. and foreign components or materials, or wholly of foreign components or materials. If the article consists wholly or partially of foreign components or materials, the manufacturing process must be such that the foreign components or materials have been substantially transformed into a new and different article, or have been merged into a new and different article.”

 

 

[mixican]

Hello Slab,

 

Thank you, and I'm glad to hear your opinion.
It is Thermal process to eliminate pathogens, and hopefully, having raw seeds turning into roasted (cooked) seeds can be considered as substantial transformation besides visual-verification.

 

Thank you for your collaboration.

[SQFconsultant]

My understanding of the "product of USA" claim is that if the item is grown anywhere else but the US it can not garner the label of product of USA regardless of processing methods.

[Slab]

Here is some additional information from Title 7 Part 65

 

 

§65.135   Covered commodity.

(a) Covered commodity means:

(1) Muscle cuts of lamb, chicken, and goat;

(2) Ground lamb, ground chicken, and ground goat;

(3) Perishable agricultural commodities;

(4) Peanuts;

(5) Macadamia nuts;

(6) Pecans; and

(7) Ginseng.

(b) Covered commodities are excluded from this part if the commodity is an ingredient in a processed food item as defined in §65.220.

[74 FR 2704, Jan. 15, 2009, as amended at 81 FR 10761, Mar. 2, 2016]

 

 

 

§65.220   Processed food item.

Processed food item means a retail item derived from a covered commodity that has undergone specific processing resulting in a change in the character of the covered commodity, or that has been combined with at least one other covered commodity or other substantive food component (e.g., chocolate, breading, tomato sauce), except that the addition of a component (such as water, salt, or sugar) that enhances or represents a further step in the preparation of the product for consumption, would not in itself result in a processed food item. Specific processing that results in a change in the character of the covered commodity includes cooking (e.g., frying, broiling, grilling, boiling, steaming, baking, roasting), curing (e.g., salt curing, sugar curing, drying), smoking (hot or cold), and restructuring (e.g., emulsifying and extruding). Examples of items excluded include roasted peanuts, breaded chicken tenders, and fruit medley.

 

[Charles.C]

Here is some additional information from Title 7 Part 65

 

 

 

 

 

So, just for example, if raw shrimp is imported into USA and then cooked in USA, it can be labelled "Product of USA" ?

 

This is perhaps analogous to "HorseGate", ie from the Book of "Methods to circumnavigate Traceability".

[FurFarmandFork]

Two different standards here.

 

The "substantial transformation" referenced above relates to the identity of the product's "country of origin".  With regard to whether you treat the product as sourced here or not is relevant.

 

However, FTC is very strict about "made in USA" claims on packaging and advertising with their "all or almost all" material sourced and manufactured within the country.

 

FTC guidance: https://www.ftc.gov/...de-usa-standard

 

Great example of how you might get in trouble is new balance shoes.

[Charles.C]

Two different standards here.

 

The "substantial transformation" referenced above relates to the identity of the product's "country of origin".  With regard to whether you treat the product as sourced here or not is relevant.

 

However, FTC is very strict about "made in USA" claims on packaging and advertising with their "all or almost all" material sourced and manufactured within the country.

 

FTC guidance: https://www.ftc.gov/...de-usa-standard

 

Great example of how you might get in trouble is new balance shoes.

 

Hi 3F,

 

I based my post6 on the extract in post5

 

Are you agreeing or disagreeing with my interpretation ? Just curious.

 

(Yr linked page looked like a mass of impenetrable legalistic jargon, no accident I'm sure  )

[FurFarmandFork]

Come on Charles, impenetrable legal jargon is what this forum is all about! And the answer is I was kind of disagreeing with your interpretation. Sort of..sometimes...............it depends.

 

I agree that imported raw shrimp that are then cooked in the USA have been substantially transformed and that if a customer requested country of origin the origin would be USA for the purposes of declaring the origin of the cooked product.

I disagree with you that on the package of shrimp you could make a "made in USA" claim, on the basis that FTC would say your product did not meet the "all or almost all" standard expected by consumers, unless the shrimp, packaging, and manufacturing occurred almost entirely within the borders/territories of the US.

 

Most important bits from the FTC guidance:

 

What is the standard for a product to be called Made in USA without qualification?

For a product to be called Made in USA, or claimed to be of domestic origin without qualifications or limits on the claim (FF&F: like "cooked" or "packaged in USA"), the product must be "all or virtually all" made in the U.S. The term "United States," as referred to in the Enforcement Policy Statement, includes the 50 states, the District of Columbia, and the U.S. territories and possessions.

What does "all or virtually all" mean?

"All or virtually all" means that all significant parts and processing that go into the product must be of U.S. origin. That is, the product should contain no — or negligible — foreign content.

Cooked shrimp are have COOL for USA based on 7 CFR 65, but "made in USA" might be a misleading statement given that the shrimp were not sourced domestically.

[Charles.C]

Hi 3F,

 

Thks for the "clarification". A nice chunk of semantics. "Foreign Content" sounds like a spin-off from "adulteration." 

 

IMHO the logic is simply wrong, "Origin" should refer to the source of the raw material.

 

It still looks to me like the intention is a pragmatic avoidance of Traceability.

 

Waiting for a ShrimpGate ?