HQ 0732388 - Country of origin marking of foam visors - United States International Trade Commision Rulings

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HQ 732388
August 1, 1990

MAR-2-05 CO:R:C:V KG

CATEGORY: MARKING

Lucy Baker
Import Operations
Expeditors International of Washington Inc. 19119 16th Avenue South
P.O. Box 69620
Seattle, Washington 98168

RE: Country of origin marking of foam visors

Dear Ms Baker:

This is in response to your letter of May 9, 1989, requesting a country of origin ruling on imported foam visors.

FACTS:

Your client ("the importer") imports foam visors from Taiwan which are assembled with U.S. made-snaps and U.S. made-headbands in the U.S. The visors each cost $.15; the snaps cost $.15; the headbands cost $.38; the labor to assemble the finished product costs $.10 and the total cost of the finished product is $.78. The importer submitted a sample visor, snaps, and headband along with a picture of the finished product which is advertised as a "sportcooler". You informed a member of my staff that the visors are imported into the U.S. in sealed boxes marked with the country of origin. The visors arrive at the importer's facility in these sealed marked boxes.

ISSUE:

Whether the imported foam visors must be individually marked with their country of origin.

LAW AND ANALYSIS:

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was "that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will." United States v. Friedlaender & Co., 27 C.C.P.A. 297 at 302 (1940).

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Pursuant to 19 U.S.C. 1304(a)(3)(D) and section 134.32(d), Customs Regulations (19 CFR 134.32(d)), Customs excepts from individual marking requirements imported articles for which the marking of the containers will reasonably indicate the origin of the articles.

The exception set forth in 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d) applies in cases where the article is imported in a properly marked container and Customs officials at the port of entry are satisfied that the ultimate purchaser will receive it in its original unopened marked container. See HQ 731768 (December 8, 1988). In this case, the imported article is not sold on an individual basis and the importer receives the foam visors in a sealed box. The pivotal question then is whether or not the importer is the ultimate purchaser of the visors. Section 134.1(d), Customs Regulations (19 CFR 134.1(d)), defines the ultimate purchaser as generally the last person in the U.S. who will receive the article in the form in which it is imported. If the imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported article to a process which results in a substantial transformation of the article, even though the process may not result in a new or different article. If the manufacturing process is merely a minor one which leaves the identity of the imported article intact, the consumer or user of the article, who obtains the article after the processing, will be regarded as the ultimate purchaser. Section 134.35, Customs Regulations (19 CFR 134.35), states that an imported article is substantially transformed if the article used in the U.S. in manufacture results in an article having a name, character, or use differing from that of the imported article.

The importer submitted no information about the process involved in assembling the visors with snaps and headbands. The cost of the U.S. labor involved in this assembly is $.10 per visor. The cost of the U.S.-made sweatband and snaps combined with the visor are $.53 per finished product out of a total cost of $.78. As pointed out by the importer, the imported article represents less than 20% of the value of the finished product. The foam visor in its imported condition is not really a visor but merely a piece of foam cut into a particular shape which is useable as a visor when attached to some type of headgear such as a sweatband or a hat. Once attached to the headband, the piece of foam becomes a finished visor that has a different character and use than the imported foam piece.

After careful review of this matter and examination of the sample, we are of the opinion that the imported article is substantially transformed by the importer and therefore is excepted from individual country of origin marking requirements. However, the outermost container of the imported article must be marked with the country of origin. This ruling is only for the purposes of 19 U.S.C. 1304.

HOLDING:

The imported article is substantially transformed by the importer and therefore, the importer is the ultimate purchaser of the imported goods. The imported article is excepted from individual country of origin marking requirements and only the outermost container in which the goods are imported must be marked with the country of origin. This determination is for the purposes of 19 U.S.C. 1304 only.

Sincerely,

Marvin M. Amernick
Chief, Value, Special Programs

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