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In the largest-ever “Made in the USA” penalty, the Federal Trade Commission (FTC) has fined Kubota $2 million.

The Federal Trade Commission (FTC) has levied a $2 million fine against Kubota, one of the world’s major tractor manufacturers, for falsely labeling certain replacement parts as “Made in the USA.” This represents the largest civil penalty under the Made in USA Labeling Rule.

Dallas-based Kubota North America Corporation violated the 2021 rule by inaccurately labeling numerous products as U.S.-made, despite being wholly imported or containing significant imported materials since at least 2021, according to a court order. The complaint also pointed out that packaging with “Made in USA” labels remained unchanged even after the production of these items was moved overseas.

In response, Kubota stated that it has fully cooperated with the FTC and is voluntarily addressing the raised concerns. The company clarified that all parts sold to customers since 2021 were produced by approved Kubota suppliers, standing by these parts as “Kubota Genuine Parts.”

In addition to the financial penalty, Kubota is now restricted from claiming U.S.-origin manufacturing for its products unless it can substantiate significant processing in the U.S. Moreover, the company is obligated to disclose the use of foreign parts in its manufacturing process.

This isn’t the first time Kubota has faced penalties for such issues. In 1999, the FTC fined the company for falsely asserting that a line of lawn tractors was made in the U.S.

Kubota, originally founded in Japan during the 19th century, has grown into a global manufacturer of tractors, construction equipment, and various machinery. It entered the U.S. market in 1972 and has previously undergone regulatory scrutiny. The recent FTC settlement highlights the agency’s commitment to combating deceptive Made in USA claims, aiming to protect consumers and ensure fair business practices. The substantial fine underscores the importance of accurate country-of-origin labeling in consumer goods.

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