Last week’s nugget described the rules manufacturers and marketers must follow to use the term “Made in America” to describe their products, in the context of a purchaser’s investigation of a target business to determine whether it is in compliance with major applicable laws. What about the related question of how a product manufactured overseas and imported by a domestic company must be labeled? Federal laws exist that dictate when the country of origin must be listed on the label. In general, the package that the ultimate user of the product, that is, the consumer, will purchase, must contain the country in which the product was manufactured. For example, if a box of two dozen bags of candy is available for purchase and the individual bags are not, then the box must be labeled with the country of origin. If the individual bags are available for sale at retail, then the bags must contain the country of origin. Failure to follow the rules governing country of origin labeling can also result in an enforcement action being brought. So, a purchaser should make sure that the seller is in compliance as it prepares to take over the seller’s business.
ABOUT GLENN D. SOLOMON
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Glenn D. Solomon is a principal at Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years. He has extensive experience in the purchase and sale of businesses, structuring ownership agreements, and advising companies in financial distress.
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