There was a time in American history when AMC Pacers and Gremlins, and the Chrysler K Car roamed the plains of the United States, and when the statement “made in the U.S.A.” was not made with pride. The late 70s and early 80s were hard times for American manufacturers. They were seen as rusting anachronisms compared to the “rising” new model economies, namely Japan and West Germany. But those days are long gone.

After years of concerted marketing effort and a significant increase in quality of U.S.-made goods, “made in the U.S.A.” is now associated with premium goods. This maxim could be no truer than in the skateboarding industry, where foreign-made goods are viewed with total distrust.

We have all walked through a chain sporting-goods store and knowingly sneered at the $24.99 complete skateboard marked with skateboarding’s current scarlet letter: “made in China.”

If one thing has been a constant in skateboarding, it’s quality skateboard decks were made of Great Lakes-region maple and pressed in California and a few other locations on the East Coast and Canada. Skateboard decks didn’t require markings as to country of origin, it was just known where, how, and of what skateboards were made.

But skateboarding, like every other industry, is subject to the “globalization” of commerce, and the rest of the world is attempting to gain entry into what to date has been North America’s monopoly on the manufacturing of skateboard decks. Troy Morgan of Expedition One, Inc., constantly receives unsolicited offers from overseas manufacturers who want to make decks for Expedition One’s brands. However, regardless of the pricing promised, Morgan doesn’t even consider foreign decks, being a firm believer in the superior quality of North American materials and U.S. manufacturing.

Morgan’s opinion is probably shared by most people in the industry and by the end consumer. But how do consumers know the origin of their favorite decks? Why do cheap skateboards say “made in China” while others don’t list any country of origin?

As you might have guessed, country-of-origin markings are heavily regulated by the federal government. The two federal agencies regulating country of origin markings are the Federal Trade Commission (FTC) and United States Customs (Customs). The FTC regulates all goods claiming U.S. origin, such as those marked “made in the U.S.A.” Customs regulates all other country-of-origin markings, including goods that were in fact made in the U.S. but are not expressly labeled as such.

Customs requires that all “products of foreign origin imported into the United States be marked with the name of a foreign country of origin” and that the marking be present when the end consumer purchases the products. However, figuring out country of origin is not as simple as you might think. Some goods are clearly of foreign origin, such as a T-shirt made from Indian cotton, fabricated and packaged in a factory in China, and then imported into the U.S. However, what if iron ore from Chile was shipped to the U.S., where it was melted down and molded into a truck with a kingpin that came from China? This situation is far less clear.

To figure out what to do with the truck, customs applies the “substantial transformation test.” This test states that goods “undergo a substantial transformation if, as a result of manufacturing and processing steps in this country, the imported goods lose their identity and are transformed into new goods having a new name, character, or use” so that no country-of-origin marking is required. In other words, if the things done to the goods in the U.S. change them enough that they then have a different name or are used for a different purpose, then the change or transformation is considered substantial and they are no longer considered foreign. This is not to say that a domestically produced skateboard truck must be stamped “made in the U.S.A.,” only that no foreign country of origin marking required.

While the substantial transformation test is most commonly used to determine goods’ country of origin, it’s not the only one. For goods being imported into the U.S. from Mexico or Canada there’s a different test. The North American Free Trade Agreement (NAFTA)–an agreement between Canada, the U.S., and Mexico–created a new test to replace the substantial-transformation test for goods traded among those countries. The NAFTA test is based upon the Harmonized Tariff Schedule, a customs guideline that minutely and painfully categorizes all goods. Even slight changes can create a new classification within the Harmonized Tariff Schedule. The NAFTA test allows the goods to be categorized as being of U.S. origin if the processing done to the goods after they are imported into the U.S. changes their classification within the Harmonized Tariff Schedule. This test may seem as though it makes it overly easy to categorize goods as being of U.S. origin, but the test cuts both ways, and it can also make it exceptionally easy to lose your U.S.-origin categorization.

For example, Levi Strauss was barred from categorizing their stonewashed jeans as U.S. goods, because even though the goods were mostly made in the U.S., the stonewashing was done in Mexico. The stonewashing was the very last processing done to the goods before they were sent back to the U.S. Stonewashed jeans are under a different Harmonized Tariff Schedule classification than regular jeans, so they could not pass the NAFTA test for goods of U.S. origin.

As you can see, there are many rules regulating the marking of origin of goods. But it’s important to note that there’s no requirement that goods made in the U.S. be marked “made in the U.S.A.” Of course, you can’t lie by stating a foreign country of origin for U.S.-made goods, as this would be deceptive. This is why there’s usually no country of origin markings on skateboard decks.

But what if you do want to label your U.S.-made goods “made in the U.S.A?” This is the area that the FTC regulates. The Federal Trade Commission Act (FTC Act) prohibits “unfair or deceptive acts or practices” in labeling. Something is considered deceptive if “it contains a representation or omission of fact that is likely to mislead consumers acting reasonably under the circumstances, and that representation or omission is material”.

“Made in the U.S.A.” representations may be either express or implied, such as advertisements displaying U.S. flags, or those that use of the phrase “American Quality.” The test used by the FTC for determining the fairness and honesty of either express or implied claims of U.S. origin is the “all or virtually all” test.

This test states that goods are considered all or virtually all made in the U.S. only when “all significant parts and processing that go into the product are of U.S. origin.” A handbook titled Complying With The Made In The U.S.A. Standard can be found at the ftc.gov Web site in the Business Guidance section. Note that the “made in the U.S.A.” test is tougher than the Substantial Transformation test. The factors the FTC considers in applying the “all or virtually all” test are the final assembly site, the proportion of U.S. manufacturing costs, and the remoteness of foreign content.

The FTC considers the site of final assembly to be extremely important to consumers in determining if they will perceive goods as being made in the U.S.A. If the final assembly site is outside the U.S., even if all of the component parts are American made, then the product cannot be labeled “made in the U.S.A.” To do so would be considered misleading to the average consumer.

There?s no fixed percentage for determining if the proportion of U.S. manufacturing costs is sufficient to meet the “all or virtually all” test. Each article is judged on a case-by-case basis. Of course, the higher the percentage of U.S. manufacturing costs, the more likely the goods are to pass the test.

The final factor the FTC considers is the remoteness of foreign content. This basically favors foreign parts and processes occurring as far away from the finished goods as possible. For example, the FTC has ruled that while the petroleum used to make the plastic case of a clock radio, otherwise all or virtually all made in the United States, was imported petroleum, the foreign content was remote enough in the manufacturing process that the clock could be labeled “made in the U.S.A.”

As previously stated, the “all or virtually all” standard is quite tough. What if you can’t pass this test, yet you still want to show that your product is mostly American made?

The FTC permits qualified claims of U.S. origin as long as the claim is truthful and substantiated. Qualified claims are those in which only certain parts or processes of the goods are labeled as being of U.S. origin, such as “70 percent U.S. content” or “painted in the U.S.” Comparative claims such as “more U.S. content than our competitor” are also allowed as long as they are truthful and can be substantiated.So if you’re in the U.S. and looking for a traditional “North American” deck, no news is good news when it comes to a deck’s country of origin. No label means its country of origin is the U.S., and more likely than not the manufacturer simply decided not to disturb its harmony and wade through the FTC labeling requirements for “made in the U.S.A.” final factor the FTC considers is the remoteness of foreign content. This basically favors foreign parts and processes occurring as far away from the finished goods as possible. For example, the FTC has ruled that while the petroleum used to make the plastic case of a clock radio, otherwise all or virtually all made in the United States, was imported petroleum, the foreign content was remote enough in the manufacturing process that the clock could be labeled “made in the U.S.A.”

As previously stated, the “all or virtually all” standard is quite tough. What if you can’t pass this test, yet you still want to show that your product is mostly American made?

The FTC permits qualified claims of U.S. origin as long as the claim is truthful and substantiated. Qualified claims are those in which only certain parts or processes of the goods are labeled as being of U.S. origin, such as “70 percent U.S. content” or “painted in the U.S.” Comparative claims such as “more U.S. content than our competitor” are also allowed as long as they are truthful and can be substantiated.So if you’re in the U.S. and looking for a traditional “North American” deck, no news is good news when it comes to a deck’s country of origin. No label means its country of origin is the U.S., and more likely than not the manufacturer simply decided not to disturb its harmony and wade through the FTC labeling requirements for “made in the U.S.A.”