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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, but manufactured in 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.

Effects on consumers

The effects of country of origin labeling on consumer purchasing have been extensively studied[1] The country of origin effect is also known as the "made-in image" and the "nationality bias."[2]

Research shows that consumers' broad general perceptions of a country, including of its national characteristics, economic and political background, history, traditions, and representative products, combine to create an overall image or stereotype that is then attached to the products of that country.[3] This image has a significant influence on consumer perceptions and behaviours, and in situations in which additional information is unavailable or difficult to get can be the sole determinant of whether or not someone buys a product.[2] Its effect is strongest on consumers who don't know much about the product or product type, and weakest on consumers who are well-informed. Sensitivity to country of origin varies by product category. It is strongest for durable goods[4] and luxury goods[5] and weakest for "low involvement" product categories such as shampoo and candy.[6] In various studies it has also been proven that the Country-of-Origin Effect also applies to services.[7]

Several studies have shown that consumers tend to have a relative preference to products from their own country[8] or may have a relative preference for or aversion against products that originate from certain countries (so-called affinity[9] and animosity[10] countries).

Labelling requirements

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

Ford automobile hubcap

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, delayed 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.

COO marking

Companies may indicate with a number of different strategies,[14] though not all of these meet legal requirements in all jurisdictions.[15]

  • Use of the phrase "Made in..."
  • Use of quality and origin labels
  • COO embedded in the company name
  • Typical COO words embedded in the company name
  • Use of the COO language
  • Use of famous or stereotypical people from the COO
  • Use of COO flags and symbols
  • Use of typical landscapes or famous buildings from the COO

International trade

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.

In principle, the substantial transformation of a product is intended as a change in the harmonized system coding. For example, a rough commodity sold from country A to country B, than subjected of a transformation in country B, which sells the final processed commodity to a country C is considered a sufficient step to label the end product made in B.[16]

Film and television production

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.[17] 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).[18] 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.[19] 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.[20]

See also

References

  1. ^ Keith, Dinnie (2003). "COUNTRY-OF-ORIGIN 1965-2004: A LITERATURE REVIEW" (PDF). Journal of Customer Behavior. Retrieved 5 October 2013. {{cite journal}}: Cite journal requires |journal= (help)
  2. ^ a b Cai, Yi (2002). "COUNTRY-OF-ORIGIN EFFECTS ON CONSUMERS' WILLINGNESS TO BUY FOREIGN PRODUCTS: AN EXPERIMENT IN CONSUMER DECISION MAKING" (PDF). {{cite journal}}: Cite journal requires |journal= (help)
  3. ^ Nagashima (1970). "Comparison of Japanese and US attitudes toward foreign products". Journal of Marketing, Vol. 31, No. 1. pp. 68–74. {{cite news}}: |first2= missing |last2= (help)
  4. ^ Jain, Subhash C. (2012). Handbook of Research in International Marketing, Second Edition (Elgar Original Reference). Edward Elgar Publishing. p. 467. ISBN 1849803021.
  5. ^ 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.
  6. ^ Urbonavičius and Justina Gineikienė, Sigitas (2009). "IMPORTANCE OF THE PRODUCT COUNTRY-OF-ORIGIN FACTOR ON PURCHASING PROCESS IN THE CONTEXT OF GLOBALISATION" (PDF). EkONOMIka: 41. {{cite journal}}: Cite journal requires |journal= (help)
  7. ^ Peters, Nils (2013). "The country-of-origin affect on perception of services: Entry mode decisions as a determinant of usability". Grin Verlag Gmbh: 116. {{cite journal}}: Cite journal requires |journal= (help)
  8. ^ Shimp, T. A. & Sharma, S. 1987. Consumer Ethnocentrism: Construction and Validation of the CETSCALE. Journal of Marketing Research, 24(3): 280-289.
  9. ^ 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.
  10. ^ 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.
  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 Archived 2011-08-10 at the Wayback Machine
  14. ^ Aichner, T. 2014. Country-of-origin marketing: A list of typical strategies with examples. Journal of Brand Management, 21(1): 81-93.
  15. ^ https://www.regulations.gov/document?D=AMS-LS-07-0081-0815
  16. ^ http://images.to.camcom.it/f/EIC/15/15408_CCIAATO_23102012.pdf
  17. ^ "The FIAF Cataloguing Rules For Film Archives" (PDF). Retrieved 2015-01-03.
  18. ^ "Sources of information". Retrieved 2007-01-14.
  19. ^ "Coordination of certain of the Member States' provisions on television broadcasting". European Parliamentary. Retrieved 2007-01-14.
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