Country of origin

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For the legal term from European law, see Country of origin principle.
"Swiss Made" label on a TAG Heuer chronograph.
Country of origin label for a product designed in the United States of America and manufactured in the People's Republic of China.

Country of origin (COO), is the country of manufacture, production, or growth where an article or product comes from. There are differing rules of origin under various national laws and international treaties.

Contents

Marketing[edit]

From a marketing perspective, country of origin is a way to differentiate the product from the competitors. Schooler (1965)[1] is generally considered as the first researcher to empirically study this effect. He found out that products, identical in every respect except for their country-of-origin, were perceived differently by consumers. Since then, more than 1000 studies have been published on this subject.[2] This research shows that the country of origin has an impact on consumers' quality perceptions of a product, as well as ultimately preference for and willingness to buy that product. Furthermore, several studies have shown that consumers tend to have a relative preference to products from their own country[3] or may have a relative preference for or aversion against products that originate from certain countries (so-called affinity[4] and animosity[5] countries). The effect of country of origin is however debated,[6] with some studies[2] questioning the relevance of academic research on country-of-origin effects for business managers. Overall, academics seem to conclude that the country with which a product is associated with, the so-called country-of-association[2] significantly impacts consumers' product evaluations and choice, but that given the number of publications available, care should be given whether yet another study on that effect is needed.[7]

Consumer choice[edit]

Consumers tend to utilize the country of origin more when they are less involved and less familiar.[8] Consumers further tend to use country of origin more as a decision tool when they consider luxury products.[9]

Country of origin and stereotypes[edit]

Research by Martin et al. (2011) shows that consumers stereotype products automatically based on country of origin. This is particularly relevant for brands with a weak country of origin (e.g., a brand produced in a country perceived as producing lower quality goods which is competing against competitors from countries stereotyped as producing high quality products). Martin et al. (2011) show that encouraging consumers to use their imaginations in positive ways can counter negative country of origin effects and that this effect can endure over time [10]

Labelling requirements[edit]

The requirements for Country of Origin markings are complicated by the various designations which may be required such as "Made in X", "Product of X", "Manufactured in X" etc. They also vary by country of import and export. For example:

United States[edit]

Section 304 of the Tariff Act of 1930 as amended (19 U.S.C.1304) requires most imports,[which?] including many food items, to bear labels informing the ultimate purchaser of their country of origin. Meats, produce, and several other raw agricultural products generally were exempt. The 2002 farm bill (P.L. 107-171, Sec. 10816), however, contains a requirement that many retail establishments provide, starting on September 30, 2004, country-of-origin information on fresh fruits and vegetables, red meats, seafood, and peanuts. However, the consolidated FY2004 appropriation (P.L. 108-199) signed January 23, 2004, delays this requirement for two years except for seafood.[13]

The Textile Fiber Products Identification Act and Wool Products Labeling Act require a Made in USA label on most clothing and other textile or wool household products if the final product is manufactured in the U.S. of fabric that is manufactured in the U.S., regardless of where materials earlier in the manufacturing process (for example, the yarn and fiber) came from. Textile products that are imported must be labeled as required by the Customs Service. A textile or wool product partially manufactured in the U.S. and partially manufactured in another country must be labeled to show both foreign and domestic processing.

On a garment with a neck, the country of origin must be disclosed on the front of a label attached to the inside center of the neck, either midway between the shoulder seams or very near another label attached to the inside center of the neck. On a garment without a neck and on other kinds of textile products, the country of origin must appear on a conspicuous and readily accessible label on the inside or outside of the product.

Catalogs and other mail order promotional materials for textile and wool products, including those disseminated on the Internet, must disclose whether a product is made in the U.S., imported, or both.

The Fur Products Labeling Act requires the country of origin of imported furs to be disclosed on all labels and in all advertising.

The American Automobile Labeling Act requires that each automobile manufactured on or after October 1, 1994, for sale in the U.S. bear a label disclosing where the car was assembled, the percentage of equipment that originated in the U.S. and Canada, and the country of origin of the engine and transmission. Any representation that a car marketer makes that is required by the AALA is exempt from the Commission’s policy. When a company makes claims in advertising or promotional materials that go beyond the AALA requirements, it will be held to the Commission’s standard.

The Buy American Act requires that a product be manufactured in the U.S. of more than 50 percent U.S. parts to be considered Made in USA for government procurement purposes. For more information, review the Buy American Act at 41 U.S.C. §§ 10a-10c, the Federal Acquisition Regulations at 48 C.F.R. Part 25, and the Trade Agreements Act at 19 U.S.C. §§ 2501-2582.

The Lanham Act gives any person (such as a competitor) who is damaged by a false designation of origin the right to sue the party making the false claim.

International trade[edit]

Further information: Rules of origin

When shipping products from one country to another, the products may have to be marked with country of origin, and the country of origin will generally be required to be indicated in the export/import documents and governmental submissions. Country of origin will affect its admissibility, the rate of duty, its entitlement to special duty or trade preference programs, antidumping, and government procurement.

Today, many products are an outcome of a large number of parts and pieces that come from many different countries, and that may then be assembled together in a third country. In these cases, it's hard to know exactly what is the country of origin, and different rules apply as to how to determine their "correct" country of origin. Generally, articles only change their country of origin if the work or material added to an article in the second country constitutes a substantial transformation, or, the article changes its name, tariff code, character or use (for instance from wheel to car). Value added in the second country may also be an issue.

Film and television production[edit]

The International Federation of Film Archives defines the country of origin as the country of the principal offices of the production company or individual by whom the moving image work was made.[14] No consistent reference or definition exists. Sources include the item itself, accompanying material (e.g. scripts, shot lists, production records, publicity material, inventory lists, synopses etc.), the container (if not an integral part of the piece), or other sources (standard and special moving image reference tools).[15] In law, definitions of "country of origin" and related terms are defined differently in different jurisdictions. The European Union, Canada, and the United States have different definitions for a variety of reasons, including tax treatment, advertising regulations, distribution; even within the European Union, different member states have different legislation. As a result, an individual work can have multiple countries as its "country of origin", and may even have different countries recognized as originating places for the purpose of different legal jurisdictions.[16] Under copyright law in the United States and other signatories of the Berne Convention, "country of origin" is defined in an inclusive way to ensure the protection of intellectual rights of writers and creators.[17]

See also[edit]

References[edit]

  1. ^ Schooler, R. D. 1965. Product Bias in Central American Common Market. Journal of Marketing Research, 2(4): 394-397.
  2. ^ a b c Usunier, J.-C. 2006. Relevance in Business Research: The Case of Country-of-Origin Research in Marketing. European Management Review, 3: 60-73.
  3. ^ Shimp, T. A. & Sharma, S. 1987. Consumer Ethnocentrism: Construction and Validation of the CETSCALE. Journal of Marketing Research, 24(3): 280-289.
  4. ^ Oberecker, E. M., Riefler, P., & Diamantopoulos, A. 2008. The Consumer Affinity Construct: Conceptualization, Qualitative Investigation, and Research Agenda. Journal of International Marketing, 16(3): 23-56.
  5. ^ Klein, J. G., Ettenson, R., & Morris, M. D. 1998. The Animosity Model of Foreign Product Purchase: An Empirical Test in the People's Republic of China. Journal of Marketing, 62(1): 89-100.
  6. ^ Josiassen, A. & Harzing, A.-W. 2008. Descending from the Ivory Tower: Reflections on the Relevance and Future of Country-of-Origin Research. European Management Review, 5: 264-270.
  7. ^ Roth, K. P. & Diamantopoulos, A. 2009. Advancing the Country Image Construct. Journal of Business Research, 62(7): 726-740.
  8. ^ Han, C. M. 1989. Country Image: Halo or Summary Construct? Journal of Marketing Research, 26(2): 222-229.
  9. ^ Aiello, G., Donvito, R., Godey, B., Pederzoli, D., Wiedmann, K.-P., Hennings, N., Siebels, A., Chan, P., Tsuchiya, J., Rabino, S., Ivanovna, S. I., Weitz, B., Oh, H., & Singh, R. 2008. An International Perspective on Luxury Brand and Country-of-Origin Effect. Brand Management, 16(5/6): 323-337.
  10. ^ Martin et al. (2011), "Countering negative country of origin effects using imagery processing", Journal of Consumer Behaviour, 10, 80-92.
  11. ^ http://www.bis.gov.uk/files/file8134.pdf Guidance Notes for Traders, retrieved 9 Oct. 2012
  12. ^ http://www.fsis.usda.gov/regulations_&_policies/United_Arab_Emirates_Requirements/index.asp US "Export Requirements for United Arab Emirates", retrieved 9 Oct. 2012
  13. ^ CRS Report for Congress: Agriculture: A Glossary of Terms, Programs, and Laws, 2005 Edition - Order Code 97-905
  14. ^ "Choice of Original Release Title in Country of Origin as Main Entry". Retrieved 2007-01-14. >
  15. ^ "Sources of information". Retrieved 2007-01-14. 
  16. ^ "Coordination of certain of the Member States' provisions on television broadcasting". European Parliamentary. Retrieved 2007-01-14. 

External links[edit]

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