US: Retailers fined over alleged textile mislabelling
Four US retailers have agreed to pay penalties totalling US$1.26m for allegedly falsely labelling textiles as made from bamboo, when they were actually rayon.
Amazon.com, Leon Max, Macy's, Sears and its subsidiary Kmart will pay the penalties to settle Federal Trade Commission (FTC) charges that they violated the Textile Products Identification Act and the FTC's Textile Rules by labelling and advertising products sold in stores as being made of bamboo, when they were made of rayon.
The FTC said that while bamboo textiles are promoted as environmentally friendly, the process for manufacturing rayon, even when it is made from bamboo, is "far from a green one".
Sears will pay $475,000, Amazon has been fined $455,000, Macy's has agreed to $250,000 and Leon Max wll pay $80,000.
The penalties reflect how long the companies continued to sell mislabelled textiles after receiving an FTC warning letter in early 2010, as well as the amount of products sold.
The companies will also be required to ensure that labels and ads for bamboo textiles accurately indicate their fibre content.
The FTC also yesterday (3 January) announced an Enforcement Policiy Statement, which allows US retailers to avoid liablility for mislabelling or false advertising if they rely in good faith on a "guaranty" from a US supplier that certifies the products it provides are not mislabelled, falsely invoiced, or falsely advertised.
Guaranties can only be obtained from a person residing in the US, so they can not obtain guranties for directly imported textile, wool and fur products.
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