[House Report 106-399]
[From the U.S. Government Publishing Office]





106th Congress                                                   Report
  1st Session           HOUSE OF REPRESENTATIVES                106-399

======================================================================



 
                    MADE IN AMERICA INFORMATION ACT

                                _______
                                

October 19, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Bliley, from the Committee on Commerce, submitted the following

                              R E P O R T

                        [To accompany H.R. 754]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Commerce, to whom was referred the bill 
(H.R. 754) to establish a toll free number under the Federal 
Trade Commission to assist consumers in determining if products 
are American-made, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.

                                CONTENTS

                                                                   Page
Amendment........................................................     1
Purpose and Summary..............................................     3
Background and Need for Legislation..............................     3
Hearings.........................................................     4
Committee Consideration..........................................     4
Committee Votes..................................................     4
Committee Oversight Findings.....................................     4
Committee on Government Reform Oversight Findings................     5
New Budget Authority, Entitlement Authority, and Tax Expenditures     5
Committee Cost Estimate..........................................     5
Congressional Budget Office Estimate.............................     5
Federal Mandates Statement.......................................     7
Advisory Committee Statement.....................................     7
Constitutional Authority Statement...............................     7
Applicability to Legislative Branch..............................     7
Section-by-Section Analysis of the Legislation...................     7
Changes in Existing Law Made by the Bill, as Reported............     9

                               Amendment

    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Made in America Information Act''.

SEC. 2. ESTABLISHMENT OF TOLL FREE NUMBER PILOT PROGRAM.

  (a) Establishment.--If the Secretary of Commerce determines, on the 
basis of comments submitted in rulemaking under section 3, that--
          (1) interest among manufacturers is sufficient to warrant the 
        establishment of a 3-year toll free number pilot program, and
          (2) manufacturers will provide fees under section 3(c) so 
        that the program will operate without cost to the Federal 
        Government,
the Secretary shall establish such program solely to help inform 
consumers whether a product is ``Made in America''. The Secretary shall 
publish the toll-free number by notice in the Federal Register.
  (b) Contract.--The Secretary of Commerce shall enter into a contract 
for--
          (1) the establishment and operation of the toll free number 
        pilot program provided for in subsection (a), and
          (2) the registration of products pursuant to regulations 
        issued under section 3,
which shall be funded entirely from fees collected under section 3(c).
  (c) Use.--The toll free number shall be used solely to inform 
consumers as to whether products are registered under section 3 as 
``Made in America''. Consumers shall also be informed that registration 
of a product does not mean--
          (1) that the product is endorsed or approved by the 
        Government,
          (2) that the Secretary has conducted any investigation to 
        confirm that the product is a product which meets the 
        definition of ``Made in America'' in section 5 of this Act, or
          (3) that the product contains 100 percent United States 
        content.

SEC. 3. REGISTRATION.

  (a) Proposed Regulation.--The Secretary of Commerce shall propose a 
regulation--
          (1) to establish a procedure under which the manufacturer of 
        a product may voluntarily register such product as complying 
        with the definition of ``Made in America'' in section 5 of this 
        Act and have such product included in the information available 
        through the toll free number established under section 2(a);
          (2) to establish, assess, and collect a fee to cover all the 
        costs (including start-up costs) of registering products and 
        including registered products in information provided under the 
        toll-free number;
          (3) for the establishment under section 2(a) of the toll-free 
        number pilot program; and
          (4) to solicit views from the private sector concerning the 
        level of interest of manufacturers in registering products 
        under the terms and conditions of paragraph (1).
  (b) Promulgation.--If the Secretary determines based on the comments 
on the regulation proposed under subsection (a) that the toll-free 
number pilot program and the registration of products is warranted, the 
Secretary shall promulgate such regulation.
  (c) Registration Fee.--
          (1) In general.--Manufacturers of products included in 
        information provided under section 2 shall be subject to a fee 
        imposed by the Secretary of Commerce to pay the cost of 
        registering products and including them in information provided 
        under subsection (a).
          (2) Amount.--The amount of fees imposed under paragraph (1) 
        shall--
                  (A) in the case of a manufacturer, not be greater 
                than the cost of registering the manufacturer's product 
                and providing product information directly attributable 
                to such manufacturer, and
                  (B) in the case of the total amount of fees, not be 
                greater than the total amount appropriated to the 
                Secretary of Commerce for salaries and expenses 
                directly attributable to registration of manufacturers 
                and having products included in the information 
                provided under section 2(a).
          (3) Crediting and availability of fees.--
                  (A) In general.--Fees collected for a fiscal year 
                pursuant to paragraph (1) shall be credited to the 
                appropriation account for salaries and expenses of the 
                Secretary of Commerce and shall be available in 
                accordance with appropriation Acts until expended 
                without fiscal year limitation.
                  (B) Collections and appropriation acts.--The fees 
                imposed under paragraph (1)--
                          (i) shall be collected in each fiscal year in 
                        an amount equal to the amount specified in 
                        appropriation Acts for such fiscal year, and
                          (ii) shall only be collected and available 
                        for the costs described in paragraph (2).

SEC. 4. PENALTY.

  Any manufacturer of a product who knowingly registers a product under 
section 3 which is not ``Made in America''--
          (1) shall be subject to a civil penalty of not more than 
        $7500 which the Secretary of Commerce may assess and collect, 
        and
          (2) shall not offer such product for purchase by the Federal 
        Government.

SEC. 5. DEFINITION.

  For purposes of this Act:
          (1) The term ``Made in America'' has the meaning given 
        unqualified ``Made in U.S.A.'' or ``Made in America'' claims 
        for purposes of laws administered by the Federal Trade 
        Commission.
          (2) The term ``product'' means a product with a retail value 
        of at least $250.

SEC. 6. RULE OF CONSTRUCTION.

  Nothing in this Act or in any regulation promulgated under section 3 
shall be construed to alter, amend, modify, or otherwise affect in any 
way, the Federal Trade Commission Act or the opinions, decisions, 
rules, or any guidance issued by the Federal Trade Commission regarding 
the use of unqualified ``Made in U.S.A.'' or ``Made in America'' claims 
in labels on products introduced, delivered for introduction, sold, 
advertised, or offered for sale in commerce.

                          Purpose and Summary

    The purpose of H.R. 754, the Made in America Information 
Act, is to provide for the establishment and operation of a 
three-year, toll free number pilot program to assist consumers 
in determining what products are ``Made in America.'' The 
reported bill provides that all costs of the program be paid 
with fees collected from manufacturers who voluntarily choose 
to register their products under this program.
    The reported bill requires the Secretary of Commerce to 
issue regulations establishing the program, as well as 
procedures for manufacturers to register products that are made 
in America. If there is sufficient interest in providing 
private sector funding, the Secretary is directed to enter into 
a contract for the establishment and operation of the program.

                  Background and Need for Legislation

    In today's global economy, it is increasingly difficult for 
consumers to determine which products are ``Made in America.'' 
Whether shopping for cars, computers, industrial equipment, or 
hand tools, the ``Made in America'' designation still 
represents quality and value to consumers, and is something 
that consumers, when adequately informed, factor into 
purchasing decisions. Currently, there is no central repository 
for lists of American-made products.
    The issue of the appropriate definition of when a product 
is ``Made in America'' was recently reviewed by the Federal 
Trade Commission (FTC or the Commission). The FTC's long-
standing decisions have held that, for purposes of enforcement 
against ``unfair and deceptive trade practices,'' all or 
virtually all of a product must be made in the United States in 
order to make that claim. In an effort to understand the 
sentiment among both consumers and manufacturers better, the 
Commission undertook a comprehensive series of workshops, an 
extensive public comment period generating more than 300 
comments, and consumer surveys. On December 1, 1997, the 
Commission issued an enforcement policy statement on U.S. 
origin claims rejecting an earlier effort to change the 
standard used by the Commission and announcing its intent to 
continue enforcing the Commission's ``all or virtually all'' 
content standard.
    The Committee considered, and the House passed, nearly 
identical legislation in the 103rd, 104th, and 105th 
Congresses. The language reported by the Committee is identical 
in every material respect to the language passed by the House 
in the 105th Congress. The Committee's report on H.R. 3342 in 
the 103rd Congress (H. Rpt. 103-660) contains additional 
background information on the subject of ``Made in America.'' 
(See also H.R. 447 in the 104th Congress; H. Rpt. 104-753; H.R. 
563 in the 105th Congress; H. Rpt. 105-759).

                                Hearings

    In the 104th Congress, the Subcommittee on Commerce, Trade, 
and Hazardous Materials held a hearing on virtually identical 
legislation, H.R. 447, a bill to establish a toll-free number 
in the Department of Commerce to assist consumers in 
determining if products are American-made, on July 11, 1996. 
The Subcommittee received testimony from The Honorable James A. 
Traficant, U.S. House of Representatives, Seventeenth District, 
State of Ohio, who testified in favor of the legislation. The 
Committee held no additional hearings during the 105th Congress 
or the 106th Congress.

                        Committee Consideration

    On September 29, 1999, the Committee on Commerce met in 
open markup session and ordered H.R. 754 reported to the House, 
amended, by a voice vote, a quorum being present.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. 
There were no record votes taken in connection with ordering 
H.R. 754 reported. An Amendment in the Nature of a Substitute 
by Mr. Bliley to conform the bill to the text of H.R. 563, as 
passed by the House in the 105th Congress, was agreed to by a 
voice vote. A motion by Mr. Bliley to order H.R. 754 reported 
to the House, amended, was agreed to by a voice vote, a quorum 
being present.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee held a legislative 
hearing in the 104th Congress on virtually identical 
legislation, H.R. 447, and made findings that are reflected in 
this report.

           Committee on Government Reform Oversight Findings

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, no oversight findings have been 
submitted to the Committee by the Committee on Government 
Reform.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
754 would result in no new or increased budget authority, 
entitlement authority, or tax expenditures or revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974 with the 
following clarification: The Committee notes that the 
Congressional Budget Office estimates that there may be some 
minimal cost to the Federal government to conduct the 
rulemaking by the Secretary. However, since these costs are 
minimal, the Committee believes and intends that this program 
should be, and can be, operated within existing appropriations 
levels and that no additional funding is required.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of Rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 18, 1999.
Hon. Tom Bliley,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 754, the Made in 
America Information Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Mark Hadley.
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 754--Made in America Information Act

    Summary: H.R. 754 would require the Department of Commerce 
to conduct a rulemaking proceeding to determine if sufficient 
interest exists among manufacturers to establish a consumer 
telephone hotline listing products that are made in America. If 
sufficient interest is found, the bill would require the 
department to enter into a contract to establish a three-year 
pilot program to operate such a hotline and to charge fees to 
pay for the cost of the contract.
    CBO estimates that implementing H.R. 754 would not result 
in any significant net cost to the federal government because 
the bill would authorize the Department of Commerce to 
establish fees to offset the costs of the toll-free hotline, 
subject to approval in appropriation acts. H.R. 754 could 
increase governmental receipts because the bill would establish 
a civil penalty for anyone who knowingly registers a product 
for the toll-free hotline that is not made in America, as 
defined by the bill. Because the bill could affect receipts, 
pay-as-you-go procedures would apply, but CBO estimates that 
any such receipts would not be significant in any year.
    This bill contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reforms Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 754 is shown in the following table. 
The costs of this legislation fall within budget function 370 
(commerce and housing credit).

----------------------------------------------------------------------------------------------------------------
                                                                      By fiscal years, in millions of dollars--
                                                                    --------------------------------------------
                                                                       2000     2001     2002     2003     2004
----------------------------------------------------------------------------------------------------------------
                                      SPENDING SUBJECT TO APPROPRIATION \1\

Estimated Authorization Level:
    Funding for the Department of Commerce.........................       10        0        0        0        0
    Less: Estimated Collections of Fees............................       -2       -3       -4       -1        0
                                                                    --------------------------------------------
      Estimated Net Authorization..................................       10       -3       -4       -1        0
                                                                    ============================================
Outlays:
    Estimated Gross Outlays........................................        2        3        4        1        0
    Less: Estimated Collections of Fees............................       -2       -3       -4       -1        0
                                                                    --------------------------------------------
      Estimated Net Outlays........................................        0        0        0        0        0
----------------------------------------------------------------------------------------------------------------
\1\ H.R. 754 also could increase government receipts, but CBO estimates that any such change would be less than
  $500,000 a year.

    Basis of estimate: For purposes of this estimate, CBO 
assumes H.R. 754 will be enacted during fiscal year 2000 and 
that $10 million will be appropriated in that year for the 
total three-year cost of the consumer hotline.
    Based on information from the Department of Commerce, CBO 
estimates that the rulemaking proceeding required by the bill 
would cost less than $500,000, primarily for personnel costs. 
Assuming the department finds sufficient interest among 
manufacturers, CBO estimates that establishing a hotline and 
database, and operating the program over a three-year period 
would cost the federal government approximately $10 million 
beginning in fiscal year 2000 and ending during fiscal year 
2003. This estimate assumes that all costs of the three-year 
contract for the consumer hotline would be covered by fees, as 
specified in the bill.
    The authorization to enter into a contract for operation of 
the hotline would not constitute direct spending because the 
bill would require that the contract be paid solely through fee 
collections, and that those fees be collected only to the 
extent allowed in appropriation acts.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. H.R. 754 
would affect receipts because the bill would establish a civil 
penalty for anyone who knowingly registers a product for the 
toll-free hotline that is not made in America, as defined by 
the bill. Collection of fines would count as governmental 
receipts and would be deposited in the general fund of the 
Treasury. CBO expects that any additional collections would be 
less than $500,000 in any year.
    Intergovernmental and private-sector impact: The bill 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Mark Hadley.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of Rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation

Section 1. Short title

    This section establishes the short title of the 
legislation, the ``Made in America Information Act'.

Section 2. Establishment of toll free number pilot program.

    This section provides that if, pursuant to comments 
received during rulemaking under section 3 of the bill, the 
Secretary of Commerce (the Secretary) determines there is 
sufficient interest among manufacturers in the private sector 
to operate the program established under this section without 
Federal funding, the Secretary will establish a toll free 
number which may be used by consumers to determine if a product 
is made in America. Under this section, the Secretary has 
responsibility to publish the toll free number in the Federal 
Register.
    This section also requires that the Secretary contract out 
the establishment and operation of the toll free number pilot 
program and the registration of products pursuant to 
regulations issued under section 3.
    This section further provides that consumers shall be 
informed: as to whether products about which inquiry is being 
made are registered as being ``made in America''; that 
registration of a product does not mean that the product is 
endorsed or approved by the Government; that registration of a 
product does not mean that the Secretary has conducted any 
investigation to confirm that the product is a product which 
meets the definition of ``Made in America''; and that 
registration of a product does not mean that the product 
contains 100 percent U.S. content.

Section 3. Registration

    This section provides that the Secretary shall propose a 
regulation:
          (1) to establish procedures under which manufacturers 
        may voluntarily register products which meet the 
        definition of ``made in America'' used in the bill and 
        have such products included in the information 
        available through the toll free number;
          (2) to establish, assess, and collect fees for the 
        costs of having products included in information 
        available through the toll free number established 
        under section 2;
          (3) to establish a toll free number pilot program; 
        and
          (4) to solicit views from the private sector 
        concerning the level of interest of manufacturers in 
        registering products under the terms and conditions of 
        the toll free number pilot program described in the 
        proposed regulations and the level of interest of 
        consumers.
    This section also states that manufacturers who register 
products as being ``Made in America'' for purposes of this Act 
shall be subject to a fee to cover all costs of operating the 
toll free number pilot program established in section 2.

Section 4. Penalty

    This section provides that if a manufacturer knowingly 
registers a product with the Secretary under section 3 which is 
not made in America, the manufacturer may not offer such 
product for purchase to the Federal government and shall be 
subject to a civil penalty of not more than $7500, which the 
Secretary of Commerce may impose.

Section 5. Definition

    This section provides that the term ``Made in America'' has 
the same meaning given unqualified ``Made in the U.S.A.'' or 
``Made in America'' claims, for purposes of the laws 
administered by the Federal Trade Commission. Under the Federal 
Trade Commission Act, as historically applied and recently 
reaffirmed by the FTC, that agency has treated unqualified 
``Made in America'' or ``Made in U.S.A.'' claims as having to 
meet a standard of all or virtually all domestic content. The 
bill's definition adopts the standard used by the FTC in order 
to ensure that ``Made in America'' claims made pursuant to this 
legislation meet the standard for unqualified ``Made in 
U.S.A.'' or ``Made in America'' claims that the FTC uses to 
enforce section 5 of the Federal Trade Commission Act's (15 
U.S.C. Sec. 45) prohibition against deceptive acts or 
practices.
    This section also states that the term ``product,'' as used 
in the reported bill, means a product with a retail value of at 
least $250.

Section 6. Rule of construction

    This section states that nothing in this Act shall be 
deemed to alter, amend, modify, or otherwise affect in any way, 
the Federal Trade Commission Act or the opinions, decisions, 
rules, or any guidance issued by the Federal Trade Commission 
regarding the use of unqualified ``Made in the U.S.A.'' or 
``Made in America'' claims in labels on products introduced, 
delivered for introduction, sold, advertised, or offered for 
sale in commerce.

         Changes in Existing Law Made by the Bill, as Reported

    This legislation does not amend any existing Federal 
statute.

                                

