Amazon and other retailers oppose measure to require country-of-origin labeling for goods sold online

The proposal has bipartisan support in China-related legislation moving through the Senate

By  Jeanne Whalen and Abha Bhattarai
May 27, 2021

Amazon and other retailers are opposing a bipartisan measure that would require online sellers to clearly state where their products are made, a rule proponents say could help consumers seeking U.S.-made goods.

The measure, backed by a bipartisan vote in the Senate Committee on Commerce, Science and Transportation, is part of a broad legislative package aimed at boosting U.S. competitiveness versus China. Senate Majority Leader Charles E. Schumer (D-N.Y.) is pushing to pass the package, called the U.S. Innovation and Competition Act, as soon as this week, although Democrats and Republicans are still racing to make revisions.

The measure, added as an amendment to the package by Sen. Tammy Baldwin (D-Wis.), has the backing of manufacturers and marketers that make goods in the United States and say it would help them capitalize on growing consumer interest in domestically made products.

But big retailers and others, including the electronics, furniture and toy industries, have pushed lawmakers to remove the measure from the legislative package, saying it would add an onerous regulation for online sellers.

Goods sold in person are required by law to display their country of origin, but current laws don’t force online retailers to include this information about their products.

“The provision will create a new liability for retailers and sellers to not only post the information but certify the accuracy of the information provided by product vendors,” more than two dozen industry associations, including the National Retail Federation and the Consumer Technology Association, wrote in a May 21 letter to the Senate Commerce Committee, echoing similar complaints they made in a May 17 letter.

The groups also questioned the Federal Trade Commission’s ability to fairly enforce the measure, which is called the Country of Origin Labeling Online Act, or COOL Act. The FTC declined to comment on proposed legislation.

Amazon, in an emailed statement, said it was attempting to change the measure.

“While we oppose the amendment as introduced, we are working with lawmakers constructively on ways that it can be improved,” the company said. Amazon’s founder, Jeff Bezos, owns The Washington Post.

The Coalition for a Prosperous America, a nonprofit group representing domestic manufacturers and labor organizations, this week criticized Amazon for its opposition and urged Congress to support the new labeling rules.

The NRF, the retail industry’s largest trade group, said it opposes the measure because it would create complications for retailers who might source any number of items — T-shirts, say, or strawberries — from multiple countries.

Keeping track of which product is ultimately mailed to consumers creates unnecessary hurdles, the NRF and other trade groups said, particularly because many retailers fulfill online orders from local stores instead of a central warehouse.

“Although transparency is a good thing — I would certainly never argue that the consumer shouldn’t know where something is made — the bottom line is that this would be very complex both legally and technically for so many of our members,” said Stephanie Martz, the NRF’s chief administrative officer and general counsel. “I question whether it’s worth it, whether consumers really are hankering to know where their video camera was made.”

Supporters of the measure disagreed, saying consumers are eager to know the origin of the goods they purchase.

Online product listings include “extreme levels of detail about color and size, but a lot of these retailers don’t mind masking things that are made in China because there are few people seeking made-in-China goods,” said Scott Paul, president of the Alliance for American Manufacturing.

Domestic manufacturers, including garden tool maker CobraHead and Authenticity50, which makes bedding and towels, also hailed the measure.

Online shoppers “are often confused or concerned about where the products come from,” Jimmy MacDonald, co-founder of Authenticity50, said by email. They “can be misled to believe that an item is made here, because the company is based in the USA, or the item may be ‘designed in the USA.’ ”

“Every consumer has a right to know what they are buying, and retailers have a responsibility to provide honest transparency and clear information,” MacDonald said.

Greg Owens, whose company makes stainless-steel forks, spoons and knives in New York, said increased transparency would help buoy his business, Liberty Tabletop, which last year brought in $10 million.

“The impact would be huge — we’re talking doubling or tripling our business,” said Owens, chief executive of Sherrill Manufacturing. “One of the biggest frustrations people have, that we hear about every day, is that they can’t find things that are made in America when they’re shopping online. They don’t know where something is made until their Amazon package shows up and it says ‘Made in China.’ ”

The company, he said, is the last remaining flatware manufacturer left in the United States and sells most of its wares online, on its own website as well as through retailers such as Amazon. But, he said, it’s increasingly difficult to set his products apart from overseas competitors, which are often cheaper.

“It’s become a typical David versus Goliath battle that we’re trying to fight,” said Owens, who co-chairs the buy-American committee at the Coalition for a Prosperous America.

“The resistance is coming from the big guys, because they know if you go to their websites and see that everything is made in China, that’s going to turn people off,” Owens said.

Baldwin said her office is “in communication with stakeholders and online retailers on the final text of the amendment.”

“I’m hopeful we’ll reach a compromise that satisfies all parties. But my bottom line is that I’m committed to fixing our nation’s outdated labeling laws to promote transparency for Americans shopping online,” she said.

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