Tasking Online Marketplaces with Verifying Country-of-Origin is Redundant and Unreasonable
In a world where a single product can be a patchwork of global components or a vintage item missing its paper trail, country-of-origin (COO) verification is a determination online marketplaces are neither equipped nor situated to make. The Administration’s March 13 Executive Order (EO) 14392, “Ensuring Truthful Advertising of Products Claiming to Be Made in America,” looks to solve one aspect of this problem, but in doing so overreaches. The EO directs the Federal Trade Commission (FTC) to prioritize enforcement of existing “Made in USA” standards and consider whether online marketplaces should bear responsibility for verifying COO claims.
While the FTC has authority to police deceptive origin claims after they’re made, such enforcement should be directed at the entity making that claim—the manufacturer or direct seller. Requiring marketplaces to verify COO claims would go further, shifting responsibility to intermediaries and into complex origin determinations typically handled by U.S. Customs and Border Protection.
Maintaining the integrity of “Made in USA” claims on online marketplaces is a legitimate consumer protection issue. Indeed, consumers and manufacturers benefit from truthful information about product origin, and there is evidence that consumers may be willing to pay a premium for domestically produced goods. At the same time, the approach outlined in the EO may be inconsistent with the intent of an existing statutory framework enacted by Congress, while advancing verification requirements that are infeasible at scale, particularly for intermediaries hosting third-party sellers. Rather than introducing new obligations, policymakers should consider whether this approach risks undermining established legislative consensus.
Tension with Congressional Intent and the FTC’s Existing Authorities
The 2022 INFORM Consumers Act (15 U.S.C. § 45f) is Congress’s most recent effort to improve marketplace transparency and accountability. The law requires platforms to collect, verify, and disclose certain information about high-volume third-party sellers. Importantly, current law does not require COO verification due to its disproportionate impact on small businesses who source goods from multiple suppliers. Instead, it focuses on information that is useful but also more operationally feasible to obtain such as seller identity, using relevant information such as contact information and tax identification.
By contrast, the EO directs the FTC to consider imposing verification obligations Congress did not include in INFORM and that may shift substantiation responsibilities to platforms which do not make the underlying claims. Congress should be aware of this inconsistency to ensure implementation does not disrupt or override existing law.
This tension is further compounded by the FTC’s Made in USA Labeling Rule, (2021) which codifies the longstanding “all or virtually all” standard and authorizes the FTC to seek civil penalties for violations, placing responsibility on the manufacturers and sellers making claims. While companies choosing to label products as “Made in USA” have certain obligations, there is no general obligation for sellers to include COO labels, so extending verification obligations to marketplaces would represent a significant expansion of intermediary liability beyond traditional FTC enforcement practice, as the FTC itself previously acknowledged. Finally, established trade practice reinforces this allocation of responsibility. COO determinations for imports are made at the point of importation by U.S. Customs and Border Protection and are not typically re-verified downstream, particularly when documentation is unavailable.
The Practical Challenges of Origin Verification
While the INFORM Act requires platforms to verify fixed seller identity information, extending this obligation to substantiate “Made in USA” claims would represent a significant and impractical expansion of platform liability.
Online marketplaces facilitate transactions across millions of third-party sellers and product types, including used goods. The provenance of used goods—such as craftworks, secondhand clothing, appliances, or refurbished furniture—is often impossible to verify due to missing origin documentation, making verification across all listings infeasible.
Broad verification requirements could also burden small sellers and consumers, potentially driving occasional sellers off platforms and reducing product availability. Unlike INFORM, which limits requirements to “high-volume third-party sellers” meeting defined thresholds, broader mandates would impose obligations Congress deliberately avoided.
Even for marketplaces that primarily facilitate the sale of new goods, verifying COO claims at scale would require complex, resource-intensive systems to track global supply chains. Many products include components from multiple countries, and determining compliance with the “Made in USA” standard requires detailed, product-specific analysis that platforms are not positioned to conduct.
Online marketplaces generally lack visibility into manufacturers’ sourcing and production processes, and do not control the information necessary to substantiate such claims. To the extent marketplaces can play a role, their capabilities are better aligned with incentivizing accurate disclosures or taking action against repeat bad actors, not independently verifying origin claims across all listings, which would be costly and introduce significant enforcement uncertainty.
A Path Forward
Promoting accurate “Made in USA” claims is a legitimate and important objective. However, achieving this goal requires a policy approach that is both effective and operationally feasible. Assigning verification responsibility to intermediaries that lack access to supply chain data risks creating significant compliance burdens and unintended consequences for sellers and consumers alike. Faced with the cost and uncertainty of verifying COO claims, platforms may choose to restrict or remove such claims altogether rather than assume the risk of liability for inaccurate information they cannot independently substantiate. This would reduce the availability of origin information to consumers, undermining the very goal of incentivizing U.S. production and ensuring truthful “Made in USA” claims in the marketplace.
