‘Made in’ Label: protectionist, bureaucratic and costly

GRTU called on the Ministry for Finance, the Economy and Investment as responsible for trade relations to stand against the Commission proposal for a mandatory ‘made-in' label to be attached to certain imported consumer goods. The Ministry consulted the GRTU on the new Commission proposal and GRTU replied as follows:

The commerce sector strongly rejects the claims that the proposed label is a ‘necessity' and will ‘protect our consumers'. The proposed label is far from helping, such a label would simply create another barrier to trade at a time when Europe needs growth, not protectionism.

The ‘made-in' label has already been clearly rejected by the majority of business and consumer associations, which replied to the first Commission consultation on the proposal. GRTU argues that significant objections continue to apply:

• In global production chains, products are often processed in several different countries. Indicating one single country of origin would be misleading for consumers. Moreover, in many companies, internal processes would have to be adapted, with time and money spent on compliance and surveillance – resources that would be lost for efficient business and competitiveness, especially for SMEs.
• According to the Commission's own impact assessment, the label could cause additional costs of up to €1.50 per article for clothing and up to €2 per article for footwear. Furthermore, European companies would have to bear additional logistical costs related to the different procedures to control and manage the goods.
• The EU and its trading partners have different rules of origin. In practice, this would make the implementation and management of the label very complicated for companies which produce in developing countries and export to non-EU as well as EU countries.
• Such a measure would require companies to undergo lengthy controls at customs, running counter to the aim of boosting business and reducing red tape. The establishment of a special ‘Origin Marking Committee' to administer the label would create further unnecessary bureaucracy.

Since this label would be limited to some imported consumer goods only – such as textiles, clothing, shoes, leather and furniture – questions must be raised as to its true objectives. Is the Commission really seeking to protect consumers, or to encourage protectionism? We truly hope that our leaders can spare Europe this burden.