02. September 2013
In February, the European Commission announced plans to introduce obligatory country of origin labelling for consumer products. Much of the business community view these plans as a danger to the good reputation of the “Made in Germany” seal.
Country of origin labelling
Whether manufacturers place country of origin information on consumer products has always been a voluntary decision. Manufacturers are therefore free to apply the “Made in Germany” seal to products which are not exclusively made abroad.
The European Commission’s plans for obligatory country of origin labelling have been criticised for being linked to the EU’s Community Customs Code. Many are worried that a product’s origin will therefore be derived from the value of its parts. This would mean that the quality or technical design of a product would no longer play a role. German products, however, are well known for the quality of engineering and processing and not simply for the parts they contain.
To save cost, many products are produced outside the EU. It is a consequence of globalisation that it is rare to find products which are exclusively produced in an EU country.
If the country of origin information is to be derived from the origin of the parts in a product, the “Made in Germany” seal could lose its prominence.
European Commission defends plans
The European Commission has defended its proposals, stating that the Community Customs Code defines the country of origin as the country in which a product undergoes its “last, substantial, economically justified processing or working”.
But Gerta Mlejnek of the department of Finance and Trade Policy at the Viennese Chamber of Commerce believes the definition is not without its problems.
“If the strings and frame of a tennis racket are designed in Austria, but assembled in the Ukraine, the seal “Made in Ukraine” would have to be displayed,” Mlejnek claims. She asserts that such a situation would be misleading and furthermore, that it is unclear what benefits consumers would derive from such labelling.
Ultimately, it seems unlikely that the European Commission will succeed with its proposal. Since 2005, the project has continually encountered resistance from member states and nine member states have already expressed their opposition to the proposals, which is sufficient to block the project.
The reputation of the seal “Made in Germany” therefore remains intact for now.
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Categories: Business Law