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New Executive Order Targets Fraudulent 'Made in America' Claims: What Importers Must Know

Meta Description: The March 2026 Made in America EO exposes importers to dual CBP and FTC enforcement. Learn the compliance risks and action steps.

Key Takeaways

  • **Executive Order signed March 13, 2026** directs FTC to prioritize enforcement against false "Made in America" claims
  • **Online marketplaces** like Amazon and Walmart may face new regulations for failing to verify origin claims
  • **Federal contractors** face False Claims Act referrals for misrepresenting origin
  • **Dual enforcement exposure**: CBP governs import marking; FTC governs post-import marketing claims
  • **Penalties can exceed $50,000 per violation** under FTC's Made in USA Labeling Rule
  • **Action required now**: audit supply chains, review marketing claims, document origin substantiation

On March 13, 2026, President Trump signed an Executive Order that doesn't create new law but fundamentally shifts how existing law will be enforced. For importers and manufacturers, the message is unambiguous: if your "Made in America" claims cannot withstand scrutiny, you will face enforcement.

The Order targets three distinct pressure points: FTC enforcement prioritization, online marketplace accountability, and federal procurement verification. Each creates new compliance exposure for companies that have treated country-of-origin claims as marketing flexibility rather than legal obligation.

What the Executive Order Actually Does

The Order directs three separate enforcement streams.

FTC Enforcement Prioritization. The Federal Trade Commission is directed to prioritize enforcement actions against sellers and manufacturers who make unsubstantiated "Made in America" or similar origin claims. This is not a new standard. The FTC has enforced the "all or virtually all" standard for decades. What changes is prioritization. Expect more investigations, more consent orders, and higher penalty demands.

Online Marketplace Accountability. The FTC is directed to consider issuing regulations that would treat an online marketplace's failure to establish origin verification procedures as an unfair or deceptive practice under the FTC Act. This means platforms like Amazon, Walmart Marketplace, and eBay may soon be required to verify origin claims before allowing sellers to use "Made in America" designations. Marketplaces that fail to implement verification could face direct FTC enforcement.

Federal Procurement Verification. Agencies overseeing government-wide acquisition contracts must periodically verify "Buy American Act" and country-of-origin claims. Contractors found to have misrepresented origin status will have products removed from procurement availability and be referred to the Department of Justice for False Claims Act actions. This creates treble damages exposure for government contractors who misrepresent origin.

Why Importers Face Dual Enforcement Risk

This Order exposes a compliance gap that many importers do not fully appreciate. Country-of-origin compliance is not a single regulatory regime. It is two.

CBP governs import marking requirements. Under 19 CFR Part 134, imported goods must be marked with their foreign country of origin. CBP applies the "substantial transformation" test. The last country where a product underwent a fundamental change in name, character, or use is the country of origin for CBP purposes. This is the standard that determines what appears on your import entry and what marking must appear on the product itself.

FTC governs post-import marketing claims. Once goods clear CBP, the FTC has jurisdiction over how those goods are advertised and labeled for U.S. consumers. The FTC standard is different. A product can be marked with a foreign country of origin for CBP purposes and still lawfully bear some "Made in USA" claims if those claims are properly qualified. But an unqualified "Made in USA" claim on a product that does not meet the "all or virtually all" standard is a violation regardless of what CBP required at import.

The Executive Order removes any ambiguity about enforcement priority. Both agencies will be active. An importer who satisfies CBP marking requirements but makes unsubstantiated "Made in America" marketing claims faces FTC enforcement. An importer who misrepresents origin on a federal contract faces False Claims Act liability. The exposure is cumulative.

The "Made in USA" Standard: What Actually Qualifies

The FTC's standard is stringent. For an unqualified "Made in USA" claim, a product must be "all or virtually all" made in the United States. This means three things must be true.

First, the product's final assembly or processing must occur in the U.S. A product assembled abroad cannot bear an unqualified Made in USA claim regardless of where components were manufactured.

Second, all significant processing must occur in the U.S. This is not limited to final assembly. If critical manufacturing steps happen abroad, the claim fails even if final assembly is domestic.

Third, all or virtually all ingredients or components must be made and sourced in the U.S. The product should contain no or negligible foreign content.

The FTC evaluates foreign content by considering three factors: the percentage of total manufacturing costs attributable to foreign parts and processing, how far removed foreign content is from the finished product, and the importance of foreign content to the product's form or function.

A Swiss watch movement that costs little but is essential to the watch's function destroys a Made in USA claim. An imported lamp base that is integral to the final product destroys a Made in USA claim even if it represents a small percentage of total cost. The analysis is not purely economic. It is functional.

California adds another layer. Under California law, a "Made in USA" claim is only permissible if foreign content constitutes less than 5% of the product's wholesale value. This is stricter than the FTC standard and creates a compliance trap for products sold nationally. What passes FTC scrutiny may violate California law.

Practical Steps Importers Should Take Now

The enforcement priority shift means companies should treat this as an urgent compliance matter. Here is what to do.

1. Document your supply chain origin. For every product that bears or could bear a "Made in USA" claim, you need documented evidence of where each component was manufactured, where each processing step occurred, and what percentage of total manufacturing cost each element represents. This is not a one-time exercise. It is an ongoing record-keeping obligation.

2. Audit your current marking and labeling. Review every product in your catalog that makes any origin claim. Does the claim match the reality of where the product was manufactured? If you cannot substantiate the claim with supply chain documentation, the claim should be removed or qualified.

3. Review all marketing materials. The FTC's jurisdiction extends to advertising, websites, social media, and any other promotional materials. An origin claim on a website is subject to the same standard as a claim on a product label. Review everything.

4. Consider binding rulings. For products where origin is uncertain, CBP offers binding ruling requests that provide legal certainty on country of origin for import purposes. This is distinct from FTC compliance but provides a foundation for the analysis.

5. Qualify claims that cannot meet the unqualified standard. If your product has significant U.S. content or processing but does not meet "all or virtually all," consider qualified claims such as "Made in USA with imported components" or "Assembled in USA from imported parts." These claims must still be truthful and substantiated, but they provide a compliance pathway.

6. Assess federal contract exposure. If you sell to the government, review every origin representation in every contract. False Claims Act exposure includes treble damages and per-claim penalties. This is not theoretical risk. The Executive Order explicitly directs agencies to refer violators to DOJ.

How a Customs Broker Bridges the Compliance Gap

This dual enforcement regime creates a practical problem for importers. CBP requirements and FTC requirements are separate but related. A customs broker who understands both can help bridge the gap.

At Transmodal, we file entries, manage compliance with CBP marking requirements, and track origin documentation for duty purposes. But we also understand that origin compliance does not end at the port of entry. The same documentation that supports a country-of-origin determination for CBP purposes often provides the foundation for FTC compliance analysis.

We can help you:

  • Obtain binding rulings on country of origin for import purposes
  • Document supply chain origin for substantiation purposes
  • Identify discrepancies between CBP origin and potential FTC exposure
  • Review labeling and marking for consistency across regulatory regimes
  • Coordinate with legal counsel on marketing claim substantiation

The Executive Order changes the enforcement landscape. It does not change the underlying standards. If your "Made in America" claims are not already backed by documented supply chain evidence, the time to fix that is now.

Next Steps

If you import products that make or could make origin claims, or if you sell to the federal government under "Buy American" requirements, you need an origin compliance review.

Contact Transmodal at (201) 316-1600 or email info@transmodal.net to schedule a consultation. We will help you identify exposure, document your supply chain, and develop a compliance roadmap that addresses both CBP and FTC requirements.

Sources:

  • [Executive Order: Ensuring Truthful Advertising of Products Claiming to be Made in America](https://www.whitehouse.gov/presidential-actions/2026/03/ensuring-truthful-advertising-of-products-claiming-to-be-made-in-america)
  • [White House Fact Sheet](https://www.whitehouse.gov/fact-sheets/2026/03/fact-sheet-president-donald-j-trump-ensures-truthful-advertising-of-products-claiming-to-be-made-in-america)
  • [FTC: Complying with the Made in USA Standard](https://www.ftc.gov/business-guidance/resources/complying-made-usa-standard)