Domestic companies that manufacture American flags are crying foul over attempts by Chinese companies to corner the market – in part by fraudulently claiming they were made in the USA.
Flag poles, porches and parade floats will be awash in stars and stripes during the coming weeks as patriotic Americans fly Old Glory from sea to shining sea to celebrate the nation’s upcoming birthday. But one thing revelers might not know: A growing number of those star-spangled banners don’t come from the USA at all. They were made in China.
And it’s a sore spot for hundreds of flag companies throughout the country, where the red, white and blue represent not only the symbol of freedom but a familial legacy passed down from generation to generation. Over the last 10 years, it has also come to represent struggle as they fight to beat back the influx of American flags that were actually assembled a half a world away – yet fraudulently claim to have been made stateside.
“We feel like the one category of consumer product here in America that most Americans really care whether it’s made in America or not is the symbol of our nation, the American flag,” says Larry Severini, the president of South Carolina-based Embroidery Solutions.
The Federal Trade Commission currently has strict standards in place on country-of-origin labeling requirements, but these companies say enforcement and compliance are inconsistent. The result is federal buildings and consumers unknowingly flying foreign-made flags and an increased need for businesses to educate people on the difference.
The Biden administration signed the All-American Flag Act in 2024 to crack down on foreign-made flags being purchased by the federal government. On paper, the bill was progress. In reality, key shortcomings were lurking beneath its good intentions. Now these companies are pointing to a new bill, the Make American Flags in America Act of 2025, to ensure their companies survive the tide.4
The Business of Patriotism
WGN Flag & Decorating Company is a family-owned company that has been selling flags throughout the Chicago area and shipping internationally for more than 100 years. Meanwhile, Embroidery Solutions has been embroidering the stars on flags flown by the United States government for more than three decades.
Gus Porter, the president of WGN Flag & Decorating Company, says that for most of his time in business, overseas flag production was never a real threat.
“Some of the flags from China, you can sell them for $3 or $4, whereas ours were $30, so there was a big price difference,” he says. “But you were also getting what you paid for, especially at the time in the ‘90s and early 2000s and before that, because the only Chinese flags that you would receive would be very cheap cotton.”
But he says that with the invention of Amazon, business has taken a sharp turn. He says very early on, overseas flag sellers began popping up on the site and they would take “bits and pieces” from other manufacturers’ websites, like photos and company names, and try to pull them off as their own.
“That slowly progressed into the products themselves being just simply labeled ‘Made in America’ when it was very clear that they weren't,” he says.
Severini says the COVID-19 pandemic is to blame for the “exponential growth” of e-commerce. He points to platforms taking “full advantage of the opportunity to sell to people who couldn't go to stores” when everyone was isolating inside.
“E-commerce, in and of itself, has become such a simplified way to purchase and receive merchandise. Low-value merchandise is easy pickings, and COVID was like putting lighter fluid on a fire,” he says.
“American customers want that ‘Made in America’ written on their flags because they want to buy a ‘Made in America’ U.S. flag – not just a flag that somebody writes that on. That destroys the entire symbolic gesture behind saying where the flag was produced,” says Porter.
The Loophole Problem
Porter and Severini, like nearly a dozen other flag companies, point to the de minimis loophole as the issue.
The loophole, which has been a boon to e-commerce platforms like Temu and Shein, allows packages usually under $800 to be imported without paying tariffs or undergoing formal customs procedures. U.S. Customs and Border Protection says textiles and apparel account for a full 50% of all de minimis entries into the country.
Porter says that because of the loophole, customs officers would OK a package they thought contained three flags but contained 300 flags that were vacuum sealed and had fraudulent labels with the names of American companies.
President Donald Trump attempted to close the loophole in April with an executive order closing exemptions on low-value imports. But amid the ongoing tit-for-tat trade war with Beijing, the federal trade court struck down his tariffs and appeared to also reinstate the loophole.
“We’re all pretty good friends with one another, but then when you have somebody who steps in who is playing in a completely different ball field than we are, that was a giant stab in the back to our businesses and our industry,” says Porter.
Legislative Hope but Realistic Doubt
Porter says, despite desperate pleas from flag companies, Amazon told them they wouldn’t intervene.
“I would love to think that we were strong enough to take on the world of Amazon. I would say Amazon probably does more business in a couple of months than our whole industry does within a year, so there's unfortunately no way to combat that directly,” he says.
So they began turning to politicians in the hopes that something else could be done. Republican Rep. Elise Stefanik of New York and four other GOP lawmakers were the first to try to improve the situation, introducing the “Make American Flags in America” Act in 2023. The act would have required all American flags displayed on federal property or bought by the federal government to be domestically made from fabric to the final stitch. The legislation was introduced in the House but stalled.
The second iteration of the bill, the All-American Flag Act, was then introduced by Democratic Sen. Gary Peters of Michigan along with three others. It was later passed unanimously in the Senate before being signed into law by former President Joe Biden.
Before the Flag Act, federally purchased flags were only required to contain 50% American-made materials, meaning importers were pocketing a considerable portion of the profits.
But flag companies say the act doesn’t go far enough.
Porter calls the act “symbolic at best” and says it addressed issues from 10 years ago but nothing more recent. Severini added that a last-minute addition, known as a Simplified Acquisition Threshold (SAT), required contracts to exceed $250,000 for a procurement officer in any department to make the purchase, rendering it ineffective.
“Unfortunately, other than a handful of contracts that come around maybe once every two years that need to be fulfilled for the federal government, 90% of federal government purchases are far below the SAT,” he says.
Porter, Severini and others are now pointing to the Make American Flags in America Act of 2025, introduced by Republican Sen. Ted Cruz of Texas, along with four others. The new act would build on the All-American Flag Act by removing imported flags from federal agencies while also charging the FTC with investigating the efficacy of country-of-origin labeling fraud for American flags and recommending guidance on deterring it.
“If we can actually have some of these bills pass Congress that force some of these companies to follow the rules and places like Amazon to actually have to follow these guidelines, that would make a huge, huge impact on our businesses and our industry,” says Porter.
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